How Much Does Builders Insurance Cost in Australia?
Builders insurance can vary widely in price depending on the type of work you do, the size of your projects, and the risks you face on-site. Because no two building businesses are the same, understanding the typical cost ranges and the factors that influence them is essential before choosing the right policy.
Below, we break down the average costs, what affects your premium, and how Morgan Insurance Brokers helps builders secure competitive, tailored insurance for builders.
What Types of Insurance Do Builders Usually Need?
Builders generally require several core types of insurance, each priced differently:
• Public Liability Insurance
Protects against third-party injuries or property damage caused by your work.
• Contract Works Insurance
Covers accidental damage to the building project during construction.
• Tools & Equipment Insurance
Protects your tools and gear from theft or damage.
• Plant & Machinery Insurance
Covers machinery such as excavators, bobcats, trailers and other heavy equipment.
• Commercial Vehicle or Ute Insurance
Covers vehicles used for work.
Depending on your business, you may also need Professional Indemnity, business insurance, or builders warranty (depending on location and project type).
How Much Does Builders Insurance Cost?
While prices vary, here are general cost indicators for builders in Australia:
Public Liability Insurance
Public Liability Insurance can cost from around $700 to $2,500 per year, depending on your turnover, project types, and required limit ($5M, $10M, or $20M).
Contract Works Insurance
Pricing varies significantly because it depends on project value.
Typical contract works insurance ranges from $1,000 to over $10,000, depending on whether you insure single projects or take out annual cover.
Tools & Equipment Insurance
Usually $300 to $900 per year, depending on tool value and security measures.
Plant & Machinery Insurance
Pricing depends on the machinery value.
Small items: from $400 annually
Larger equipment: can range into the thousands.
Commercial Vehicle Insurance
Typically $900 to $2,500 per vehicle, based on usage, location and vehicle type.
What Affects the Cost of Builders Insurance?
Several factors influence your premium:
• Type of building work you perform
High-risk trades or structural work generally cost more.
• Annual turnover
Higher turnover usually means higher exposure.
• Project size and contract values
Larger or more complex builds have higher risks.
• Location of work
Certain areas may have higher theft, weather or liability risks.
• Claims history
A clean history often results in better pricing.
• Required cover limits
Higher liability limits (e.g., $20M) increase premiums.
Because every building business is different, personalised quotes are essential for accurate pricing.
How Morgan Insurance Brokers Helps Builders Save Money
Morgan Insurance Brokers specialises in helping builders understand their risks and secure policies that suit their business needs and budget. By assessing the type of projects you work on, the equipment you use, and the risks you face, we ensure your insurance is correctly structured without unnecessary extras.
We handle the entire process, from reviewing your current cover, identifying gaps, explaining what you actually need (in plain language), and securing competitive premiums. If something goes wrong, we also assist with claims, helping you get the best possible outcome quickly and stress-free.
Why Builders Shouldn’t Choose Insurance Based on Price Alone
Cheapest doesn’t always mean best. Builders rely on insurance to protect:
- The property under construction
- Their tools and machinery
- Their business reputation
- Their legal liability
- Their ability to keep working
Inadequate cover can end up costing far more than the premium saved.
Morgan Insurance Brokers are construction insurance specialists and will ensure your policy actually protects you where it matters.
Get a Builders Insurance Quote
If you're a builder in Australia looking for competitive, tailored insurance, Morgan Insurance Brokers can help.
Get a fast builders insurance quote today and protect your next project with confidence.
Who Needs Public Liability & Contract Works Insurance?
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.
Does Contract Works Insurance Cover Public Liability Insurance?
No — Contract Works Insurance and Public Liability Insurance are two separate types of cover. Contract Works protects the building project itself, while Public Liability Insurance protects you against third-party injury or property damage claims. Although they are different policies with different purposes, you can choose to purchase them either together as part of a combined construction insurance package, or separately if that’s more cost-effective for your business. Even when bundled, they still remain distinct types of cover, one does not replace or include the other.
What Is Contract Works Insurance?
Contract Works Insurance is designed to protect a construction project while it is being built. It provides cover for unexpected events that may damage, delay, or interrupt the works, ensuring the project can be completed without financial loss to the builder, contractor, or property owner. This type of insurance is essential for anyone involved in construction, from small residential builders to large commercial contractors.
Contract Works Insurance typically covers:
Accidental Damage to the Construction Project
Protection for sudden and unforeseen physical loss or damage during the build, whether caused by human error, equipment malfunction, or on-site mishaps.
Fire, Storm, Vandalism & Other Insured Events
Cover for weather-related events, malicious damage, or other external forces that could impact the progress of the project.
Theft of Materials or Building Items On-Site
Construction sites are frequent targets for theft. This cover protects materials, fittings, fixtures, and other items used in the project (excluding tools unless added separately).
On-Site Risks During the Build
This includes risks such as collapse, water damage, or accidental damage caused by subcontractors, employees, or external parties.
Optional Cover for Tools, Machinery, or Equipment
You can extend the policy to include portable tools, plant and equipment, scaffolding, temporary structures, and other essential machinery. This is particularly useful for tradies and contractors who rely on specialised gear.
What Does Public Liability Insurance Cover?
Public Liability Insurance is one of the most important forms of protection for anyone working in the construction industry. It covers you if your work causes accidental injury to another person or damage to their property. Because construction sites involve heavy machinery, multiple trades, subcontractors, and unpredictable environments, the risks are significantly higher, making this cover essential and often mandatory.
Public Liability Insurance typically covers:
Damage to Third-Party Property
If your work accidentally damages someone else’s property, such as a client’s home, neighbouring structures, vehicles, or utilities. Public liability insurance covers the cost of repair or replacement. In construction, even small mistakes can lead to expensive damage, so this protection is crucial.
Injury to Others Caused by Your Work
Construction sites pose hazards to clients, visitors, inspectors, delivery drivers, and other contractors. If someone is injured because of your work or activities on-site, public liability covers medical costs, compensation, and associated expenses.
Legal Fees and Defence Costs
If a claim is made against you, even if you were not at fault, you may need legal representation. Public liability insurance covers the cost of defending the claim in court, settlements, and other legal expenses, preventing the financial strain of paying these costs yourself.
Required for Most Construction Contracts and Licensing
Builders, tradies, subcontractors, and head contractors are often required to hold public liability insurance before stepping onto a site. Many construction contracts, tenders, and licensing bodies (including QBCC and similar state authorities) require proof of cover, usually with minimum limits such as $5 million, $10 million, or $20 million.
Why Contract Works Insurance Does Not Include Public Liability
Although Contract Works Insurance and Public Liability Insurance are often purchased together, they are not the same type of cover, and one does not automatically include the other. Insurers treat these as separate policies because they protect against very different types of risks.
They Cover Completely Different Types of Risk
Contract Works Insurance protects the construction project itself — the materials, structure, and work in progress.
Public Liability, on the other hand, covers you if your work causes injury to another person or damage to third-party property. Because these exposures are so different, insurers classify them as separate policies.
Public Liability Claims Can Be Very Large
Public liability incidents can involve serious injury, long-term medical costs, or major property damage. These claims can reach hundreds of thousands, even millions of dollars.
For this reason, insurers keep Public Liability Insurance separate so they can correctly assess and price the risk on its own.
Construction Licensing and Contracts Usually Require Both
Most builder licences, subcontractor agreements, principal contractor contracts, and government tenders require you to hold both types of cover.
Contract Works is often needed to protect the project, while Public Liability is needed to protect the people and property around it.
You Must Purchase Public Liability Separately or as Part of a Package
Even if you buy Contract Works Insurance, public liability is not automatically included. You must either:
-
Purchase Public Liability as a standalone policy, or
-
Bundle it together with Contract Works in a combined construction insurance package
Even when offered together, they are still distinct policies, each with its own limits, exclusions, and pricing.
Do You Need Both Contract Works and Public Liability?
Yes, most builders, tradies, and contractors need both types of cover. Each policy protects against very different risks, and together they provide a more complete level of protection for anyone working in the construction industry.
Contract Works Insurance → Protects the Construction Site
Contract Works covers the actual project under construction, including the materials, structure, and work in progress. It responds to events like accidental damage, fire, vandalism, theft of materials, or weather-related losses.
In simple terms: it protects the job itself.
Public Liability Insurance → Protects You From Being Sued
Public Liability covers you if your work causes injury to another person or damage to third-party property. This includes clients, visitors, inspectors, delivery drivers, and other contractors on-site.
In short: it protects your business from costly legal claims.
When Are Both Policies Required?
In construction, it’s extremely common and often mandatory to hold both types of cover at the same time. They are frequently required for:
• Principal Contractor Agreements
Most head contractors require subcontractors to hold both Contract Works and Public Liability before being allowed on-site.
• Residential and Commercial Building Projects
Property owners, developers, and insurers for major projects usually insist on both forms of insurance to minimise risk.
• QBCC Licensing (if applicable)
Certain licences and project types require Public Liability and/or Contract Works coverage to meet regulatory and financial requirements.
• Council Work
Local councils generally require contractors and subcontractors to show proof of Public Liability and, depending on the project, Contract Works Insurance.
• Government Tenders
Government contracts almost always require both types of insurance, often with minimum limits such as $20M.
Here is an expanded, polished version you can place on your website. It’s clear, authoritative, and SEO-friendly.
Who Needs Public Liability & Contract Works Insurance?
Public Liability and Contract Works Insurance are essential for a wide range of professionals in the construction industry. Because construction sites involve multiple trades, expensive materials, heavy machinery and constant safety risks, most people working on a project will need one or both forms of cover.
Builders
Residential and commercial builders need Contract Works to protect the project itself and Public Liability to cover injury or property damage caused during construction.
Tradies
Electricians, plumbers, carpenters, tilers, painters, and other trades rely on Public Liability every day. Those who take on their own jobs or small projects may also need Contract Works cover.
Subcontractors
Most principal contractors require subcontractors to hold both Public Liability and, depending on the job, Contract Works Insurance before stepping onto a site.
Owner Builders
Owner builders managing their own construction or renovation projects often need Contract Works Insurance to protect the building works, and Public Liability to cover third-party risks.
Civil Contractors
Civil contractors working on infrastructure, earthworks, subdivisions, and major projects face high-risk environments and typically require both policies.
Construction Companies
Medium and large building companies often package both types of insurance together, along with plant, machinery, vehicles, and professional indemnity.
Project Managers
Construction project managers may require Public Liability for business activities and may also arrange Contract Works cover on behalf of clients or builders.
How to Buy Contract Works and Public Liability Insurance Together
Many construction businesses prefer to purchase both Contract Works and Public Liability as part of a combined construction insurance package. This is often the most convenient and cost-effective option.
Combined Construction Insurance Packages
Insurers can bundle both policies into a single package, making it easier to manage your cover, renewals, and claims. While they remain separate types of insurance, they sit under one combined policy structure.
Often Cheaper When Purchased Together
Bundling your construction insurance is often more affordable than buying each policy individually. Insurers may apply package discounts when multiple covers are combined.
Can Include Additional Covers
A combined construction insurance package can also include other essential policies such as:
- Tools and equipment insurance
- Plant and machinery cover
- Commercial vehicle or ute insurance
- Professional indemnity insurance
- Business pack cover
- Workers compensation (where required by law)
This allows builders, tradies, and construction companies to protect all aspects of their operations under one streamlined policy.
What We Do for Construction Businesses
At Morgan Insurance Brokers, we are construction insurance specialists. We help builders, subcontractors, owner-builders and tradies by:
-
Advising on what cover you need (e.g., contract works, public liability, tools & equipment)
-
Structuring combined packages that suit your project scale and risk exposure
-
Ensuring you meet contract requirements, licensing needs or tender prerequisites
-
Reviewing your cover year-on-year to keep it up to date as your business grows
Whether you’re a builder, tradie, or subcontractor, we can tailor a package that fits your project.
Get your construction insurance quote now.
What Insurance Does a Builder Need?
Being a builder has got its fair share of risks, and sorting out insurance can feel like a real headache. But having the right cover is a must to keep your business, workers, and clients safe. Construction sites can be unpredictable, and no matter how careful you are, accidents happen. This guide breaks down the essential insurance policies every builder should have to stay properly protected.
Public Liability Insurance
Public Liability Insurance is a must for builders. It’s there to protect your business if someone gets hurt or property gets damaged because of your work. For example, if a passerby gets hit by falling debris or you accidentally damage a client's property during construction, this public liability insurance covers the legal fees, compensation, and medical expenses.
Does a builder need Public Liability insurance?
In Australia, you don't always have to have Public Liability Insurance by law, but it's a damn good idea. Construction work is risky business, accidents and damage can happen all the time. Even if it's not a legal requirement where you're working, getting Public Liability Insurance is a smart move. It protects your business from claims and financial hits. Plus, a lot of contracts and projects will want to see you’re insured before they let you start the job.
Workers Compensation Insurance
Does a builder need Workers Compensation?
Workers compensation Insurance is mandatory if you have employees. It covers claims made by employees who suffer work-related injuries or illnesses. In the building industry, where the risk of injury is significant, this insurance is vital. It ensures that medical costs, rehabilitation expenses, and lost wages are covered, providing peace of mind to you and your crew.
Failure to insure for workers compensation can lead to hefty fines and serious legal consequences. For builders, maintaining this coverage is essential to protect against potential claims and ensure legal compliance.
Contract Works Insurance
Contract Works insurance, is designed to protect buildings under construction. It covers damage to the structure, materials, and equipment caused by events like fire, theft, vandalism, and weather-related incidents. This insurance is typically required by lenders and project owners to ensure the project can be completed even if unexpected damages occur.
Fixing or replacing damaged structures, materials, or gear can drain your wallet fast. That’s where Contract Works Insurance comes in. It covers these costs, keeping your business safe from big financial hits and making sure your project stays on schedule.
Professional Indemnity Insurance
Protection Against Professional Negligence
Professional Indemnity Insurance (PI) is a must-have if you're a builder offering design services or professional advice, slip-ups can happen. Maybe there's a flaw in the design that leads to structural issues later on. Fixing that can cost a pretty penny. PI insurance steps in to cover those legal and repair costs, saving your business from a big financial hit.
This insurance is essential because it covers the legal costs and compensation claims that come up from professional mistakes, errors, or oversights.
Tools and Equipment Insurance
Tools and Equipment Insurance covers the repair or replacement costs of tools and equipment used in your construction business. Given the high value of construction tools and machinery, this insurance is essential. It protects against theft, damage, and loss, ensuring minimal disruption to your operations.
Commercial Vehicle Insurance
Commercial Vehicle Insurance is a must for builders. It covers your work vans, trucks, and any other wheels you use to haul materials and gear. This insurance has your back in case of accidents, theft, or vandalism, and it also takes care of liability if someone gets hurt. Keep your business rolling smoothly with comprehensive motor vehicle insurance.
Compulsory Third Party (CTP) insurance is mandatory for all motor vehicles. It covers the costs of compensation claims if you injure or kill someone in a motor vehicle accident. This insurance doesn't cover damage to your vehicle or others' property; it's specifically for third-party injuries.
Personal Accident Insurance
Does a builder need accident insurance?
Personal Accident and Injury Insurance is a lifeline for builders. If you get hurt or disabled on the job, this coverage steps in with financial support. It takes care of medical bills, rehab costs, and even lost income. It's especially crucial for self-employed builders or small business owners who don't have the safety net that bigger companies do.
Income protection insurance
Does a builder need income protection?
Income Protection Insurance is a lifesaver for builders, on and off the job. If you get injured or too sick to work, this coverage replaces your lost income, whether the accident happens at work or elsewhere. It helps with medical bills, rehab costs, and keeps the cash flow steady while you recover. This is a must-have for self-employed builders or small business owners who don't have the safety net of a big company.
Protecting your income enhances financial security, ensuring that you can maintain your livelihood even in the face of personal injury. It is a crucial component of a comprehensive risk management strategy for builders.
Home Warranty Insurance
What is home Warranty Insurance and who does it cover?
Home warranty insurance protects homeowners if a builder becomes insolvent, dies, or disappears. This insurance allows homeowners to claim the cost of rectifying defects or completing unfinished work.
The coverage typically includes structural defects, non-structural defects, and incomplete work, ensuring comprehensive protection for homeowners.
Is Home Warranty Insurance Mandatory?
Home warranty insurance (builder's warranty insurance) is mandatory for residential building projects in many Australian states. Builders must obtain this insurance before starting a project to comply with state regulations, ensure legal compliance, and protect homeowners against defects in building work.
Management Liability Insurance
Management liability insurance can protect builders, against the financial risks associated with running a business.
Here are some examples:
Directors and Officers Liability:
- A builder's company director is sued for mismanagement after a construction project fails, causing significant financial loss to investors. This coverage pays for legal defense costs and any awarded damages.
Company Liability:
- A client sues the building company for breach of contract, claiming the project was not completed to the agreed specifications. Management liability insurance covers the legal defense costs and any settlement or judgment amount.
Employment Practices Liability:
- An employee sues the building company for wrongful termination, alleging unfair dismissal and workplace harassment. Management liability insurance covers the legal expenses and potential settlement costs.
Statutory Liability:
- The building company is fined for breaching workplace health and safety regulations. This insurance covers the fines and legal costs associated with defending the claim.
Crime Protection:
- An employee embezzles funds from the company, causing financial loss. The crime protection component of the insurance reimburses the company for the stolen money.
Tax Audit Costs:
- The building company undergoes a tax audit, incurring significant accountant fees and other related expenses. This insurance covers the costs associated with the audit.
These examples illustrate the broad range of protections offered by management liability insurance, making it an essential policy for builders.
Cyber Insurance
For builders, the importance of cyber insurance is huge. These days, construction companies are using digital tools more and more for managing projects, communicating, and handling money. This makes them a target for cyber threats, which can cause serious problems.
Specific Cyber threats for Builders:
Invoice Manipulation:
Cybercriminals may manipulate bank account details on supplier invoices, leading to substantial financial losses. Cyber insurance can cover the costs of these fraudulent activities, helping builders recover the stolen funds
Phishing Attacks:
Phishing attacks, often disguised as legitimate links such as DocuSign requests, can trick employees into divulging sensitive information or downloading malicious software. Cyber insurance provides coverage for the financial impact of such attacks and supports recovery efforts.
Business Package InsuranceÂ
Your office and warehouse are crucial to your operations. Business package insurance protects your office set up, tools, stock, and materials against damage from fire, theft, vandalism, and natural disasters whilst at your warehouse. This ensures that your workspaces remain functional and secure, no matter what.
Conclusion
Sorting out builders insurance can be a real headache, but getting the right coverage is crucial to protect your business, your crew, and your clients.
In Australia, regulations and requirements vary significantly across states.
For instance, Home Warranty Insurance and Workers Compensation have different stipulations in each state. Additionally, in New South Wales, insurance claims cannot be used to pay fines and penalties, reflecting the state's unique regulatory framework.
This highlights the importance to invest in construction insurance solutions with an experienced construction insurance broker to keep your construction business safe and sound.
It’s about peace of mind and financial security in a risky line of work. Don’t wait, protect your livelihood today. Contact us to get started!
