What is property maintenance insurance?
Understanding property maintenance insurance is an important consideration for businesses involved in the upkeep and care of commercial or residential buildings owned by landlords and property management companies.
Why is property maintenance insurance necessary?
Despite health and safety policies and careful business planning, things can and do go wrong.
A routine maintenance callout could result in a client’s tenant being accidentally injured by your power tools. Similarly, you could provide advice to a client in a good faith, only for that advice to end up causing the client more harm than good.
Even if an incident is not directly your fault, you may be held liable and could end up paying compensation and damages if a client or third party is affected. Likewise, you could also be out of pocket if your work is interrupted due to theft, personal injury, or other circumstances.
Having insurance means that if an unexpected incident occurs where you are forced by a court order to pay a claim or need to find the cash for a large business expense, like a set of replacement tools, your cashflow won’t be prohibitively impacted.
In addition to providing a form of protection, property maintenance insurance can also contribute to the overall success of your business by instilling confidence in clients by demonstrating your commitment to responsible business practices.
When should a property maintenance business consider getting insurance?
Getting property maintenance insurance should be a priority from the inception of your business. Whether you're a start-up or an established enterprise, having insurance in place safeguards your operations and reputation from day one.
What does property maintenance insurance cover?
Property maintenance insurance provides cover for a range of potential risks associated with the job. The types of policies included are often as follows:
- Public liability insurance: Shields against third-party claims for injuries or property damage during maintenance activities.
- Employers’ liability insurance: A legal requirement if you have employees, it covers you if an employee makes a successful claim for work-related injuries.
- Professional indemnity insurance: Provides protection against financial losses resulting from negligent professional advice or services offered.
- Capital death benefit: Provides financial support for loved ones in the unfortunate event of your accidental death during work-related activities.
- Tools cover: Safeguards essential tools, ensuring quick replacements in case of loss or theft.
- Temporary total disablement benefit: Offers financial assistance in the event of accidental injuries, covering medical expenses or loss of income during recovery.
How does the cost of property maintenance insurance vary?
The cost of property maintenance insurance varies depending on factors such as the size of your business, the range of services offered, and your claims history. Consulting with an experienced insurer is recommended if you want a quote tailored to your specific business needs.
What legal requirements are associated with property maintenance insurance?
Having employers' liability insurance is a legal requirement if you have employees. While having other types of cover is not required by law, it does make good business sense. Some types of insurance (e.g. public liability) may be contractually required when working with certain clients.
Understanding the factors that affect the cost of property maintenance insurance is essential for any business involved in the upkeep and care of buildings.
What factors influence the cost of property maintenance insurance?
Factors that may influence the cost of a policy premium include:
Business size
Larger businesses typically face higher costs as they often deal with more extensive projects and have a larger workforce, resulting in increased potential risks.
Range of services
The amount and types of services a business provides can impact costs. More comprehensive services may pose additional risks, potentially leading to higher premiums.
Coverage options
The specific types of insurance required can play a role in determining overall costs. These may include:
- Public liability insurance: Safeguards against third-party claims for injuries or property damage.
- Employers’ liability insurance: A legal requirement covering claims made by current or former employees for work-related injuries or illnesses.
- Professional indemnity insurance: Protects against financial losses resulting from claims for negligent professional advice or services offered to clients.
- Capital death benefit: Offers financial support in the event of the policyholder’s accidental death during work-related activities.
- Tools cover: Safeguards essential tools, ensuring quick replacements in case of loss or theft.
- Temporary total disablement benefit: Provides financial assistance in case of accidental injuries during work.
Claims history
A history of few or no claims can contribute to lower premiums, reflecting a lower perceived risk associated with your business.
Can bundling different types of insurance affect the overall price?
Bundling different types of insurance, such as public liability, employers’ liability, and tools cover, can often result in cost savings.
Insurance providers may offer discounts for comprehensive packages. Many also offer customisable plans, allowing businesses to tailor coverage to their specific needs and budget constraints.
Is there a difference in insurance costs according to a business’s location?
Factors such as local regulations, the prevalence of claims in specific areas, and the overall business environment can influence regional variations in insurance pricing.
What considerations should property maintenance businesses keep in mind when budgeting for insurance costs?
When budgeting for property maintenance insurance, businesses should consider the following:
- Coverage needs: Assess the specific risks associated with your business to determine the appropriate coverage.
- Legal requirements: Ensure compliance with legal requirements, such as employers’ liability insurance.
- Claims history: Try to maintain a positive claims history to influence lower insurance premiums in subsequent years.
- Future growth: Anticipate future expansion and reorganisation, and ensure your insurance coverage aligns with current and planned operational requirements.
Public liability insurance is an important consideration for businesses in property maintenance, offering protection against a range of potential risks and financial challenges.
What is public liability insurance?
Public liability insurance provides coverage against third-party claims for injuries or property damage arising from your business activities.
The insurance covers legal expenses and compensation costs that may arise from a successful claim made against you. If an unexpected incident occurs where you are forced by a court order to pay a claim, your business’ cashflow won’t be negatively affected.
Is public liability insurance legally required in the property maintenance industry?
While public liability insurance is not typically a legal requirement, it may be a contractual requirement. When entering a contract to provide services to a public sector organisation or large company, having public liability could be written into the agreement you have with them.
That aside, given the financial risk you may be exposing your business to by not having insurance, it makes sense to have appropriate cover from the outset.
How does public liability insurance contribute to your business’ reputation?
Having public liability insurance demonstrates professionalism, responsibility, and a commitment to the well-being of clients and the public. This can be a key factor in winning trust and securing contracts.
Does the need for public liability insurance differ if you’re not a sole trader?
The reasons for having public liability insurance remain the same, whether you're a sole trader or a larger property maintenance company. However, the scale of coverage and the associated costs may vary based on the size and nature of the business.
Larger businesses or those undertaking riskier projects may face higher premiums to account for increased potential liabilities.
Can public liability insurance be bundled with other types of insurance?
Insurers may offer public liability insurance as part of a business insurance bundle. This can provide cost savings and ensure comprehensive coverage, tailored to the specific needs of your business.
Other types of insurance that may be offered include:
- Employers’ liability insurance: Covers you for the costs of compensation, damages, and legal fees if an employee makes a successful claim for work-related injuries or illnesses.
- Professional indemnity insurance: Provides protection if a client claims for financial losses incurred due to negligent professional advice or services you offered.
- Capital death benefit: Provides financial support to family members if you die accidentally because of work-related activities.
- Tools insurance: Provides the money to ensure quick replacement of your tools if they are lost or stolen.
- Personal accident cover: Offers financial assistance if you suffer accidental injuries while working. It covers medical expenses or lost income while you are unable to work.
How can you ensure you have the right amount of public liability insurance coverage?
To ensure the right amount of coverage, property maintenance businesses should:
- assess the scale and nature of their operations.
- consider potential risks and liabilities.
- consult with experienced insurance providers to tailor coverage to their specific needs.