Public Liability Insurance and Contract Works Insurance are two of the most important types of protection for anyone working in the construction industry. Construction sites involve multiple trades, expensive materials, complex equipment, and constant safety risks — meaning even a small incident can lead to a costly claim.

Because of this, most workers, contractors, and businesses within the construction sector will need one or both of these policies to operate safely, legally, and contractually.

In this guide, we break down exactly who needs Public Liability and who needs Contract Works Insurance, and why each type of cover matters.

Why These Policies Are Essential in Construction

• Public Liability Insurance protects you if your work causes injury to another person or damage to someone else’s property.
• Contract Works Insurance protects the actual project under construction, including materials, structures, and work in progress.

They cover completely different risks — which is why many builders, tradies, and contractors require both.

1. Builders

Builders face some of the highest risks on a construction site and almost always need both types of cover.

Why Builders Need Contract Works Insurance

• Protects the building project during construction
• Covers theft of materials, fire, storm damage, vandalism and accidental damage
• Required for many residential and commercial building contracts

Why Builders Need Public Liability Insurance

• Covers injury to visitors, clients, subcontractors, and inspectors
• Protects against accidental property damage (e.g. damaging a neighbour’s fence or underground pipes)
• Often required for licensing, tenders and council approvals

Builders working on any type of project — new homes, renovations, extensions, or commercial fit-outs, benefit from having both policies.

2. Tradies

Tradies rely heavily on Public Liability Insurance as part of their everyday work.

Public Liability for Tradies

Electricians, plumbers, carpenters, tilers, painters, plasterers, landscapers, and other trades regularly interact with clients, property, and equipment, making liability protection essential.

Examples of common claims:

• Water damage caused by a plumbing installation
• Electrical faults causing damage
• Accidental damage to flooring, walls, or fixtures
• Injuries caused by tools or equipment left on-site

When Tradies Need Contract Works Insurance

Tradies who take on larger jobs, manage their own projects, or perform structural work may need Contract Works Insurance as well — especially if they are the principal contractor.

3. Subcontractors

Most subcontractors are required to hold Public Liability Insurance before they can even step onto a job site.

Why Subcontractors Need Public Liability

• Principal contractors are legally and contractually required to minimise risk
• Subcontractors often work around other trades, increasing chances of third-party damage or injury
• Many contracts will not allow subcontractors on-site without proof of cover

Do Subcontractors Need Contract Works Insurance?

Yes — depending on the job.
If a subcontractor is responsible for a section of the works, materials, or project delivery, Contract Works Insurance may be required.

4. Owner Builders

Owner builders face unique risks because they take responsibility for their own construction project.

Why Owner Builders Need Contract Works

• Covers damage to the building project
• Protects materials on-site
• Required by councils, lenders and building certifiers in many cases

Why Owner Builders Need Public Liability

• Covers injuries to visitors, neighbours, delivery drivers, or tradespeople
• Protects against accidental damage to surrounding property

Many owner builder projects cannot proceed without both types of cover.

5. Civil Contractors

Civil contractors work on large-scale projects such as:

• Roads
• Earthworks and excavation
• Drainage and utilities
• Subdivisions
• Infrastructure projects

These environments naturally involve heavy machinery, multiple civil trades, and large project values.

Why Civil Contractors Need Both

• Contract Works: Protects the works under construction
• Public Liability: Covers third-party damage (e.g., hitting underground services, damaging vehicles, injuring pedestrians)

The risk level in civil construction makes both policies fundamental.

6. Construction Companies

Construction companies, from small building firms to large commercial contractors often hold packaged solutions covering the entire business.

Typical Package Includes:

• Public Liability
• Contract Works
• Tool & Equipment Insurance
• Plant & Machinery Cover
• Commercial Vehicle or Fleet
• Professional Indemnity
• Business Insurance (office contents, stock, mobile equipment)

For companies with multiple sites or projects, bundling these policies together ensures smoother management and cost efficiency.

 

Final Thoughts: Do You Need Public Liability, Contract Works, or Both?

Most construction professionals need both policies at some point, especially when managing projects, working as the principal contractor, or entering into formal contracts or tenders.

Together, they form a complete risk protection package:

• Contract Works → Protects the project
• Public Liability → Protects you from being sued

Get the Right Cover for Your Construction Business

Whether you’re a builder, tradie, subcontractor or civil contractor, we can tailor a construction insurance package that protects your project, your tools and your business.

Get a fast, competitive quote today, and speak with a broker who truly understands the construction industry.