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Do You Really Need Insurance as a Sole Trader? A No-Nonsense Guide
Sole traders play a vital role in the UK economy. Whether working as a tradesperson, consultant, or creative professional, running your own business…
Sole TraderInsurance
Sole Trader Insurance
Public liability and business cover built for sole traders, no business bank account, VAT number or trading history needed.
Public liability and business cover built for sole traders, no business bank account, VAT number or trading history needed.
Public liabilityTools & equipmentPersonal accident
Compare from 20+ Trusted Insurers
Speak to a specialist 0330 027 0996
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What is sole trader insurance?
Sole trader insurance isn’t one policy, it’s the combination of covers a self-employed person buys to protect their business. Public liability is the usual starting point, with professional indemnity, tools or stock cover added depending on what you do.
If you work alone with no employees, employers’ liability generally isn’t a legal requirement, that obligation only starts once you take someone on, even casually.
Sole trader insurance can include:
Public liabilityProfessional indemnityTools & equipment coverPersonal accident coverLegal expensesBusiness interruption
Do sole traders need insurance?
Almost no business insurance is legally required for a sole trader working alone, but clients, landlords and trade bodies often require it before they’ll work with you.
You should seriously consider cover if you:
Deal face-to-face with the publicVisit customer or client premisesGive advice clients rely onAre asked for proof by a clientRent premises or a market pitchWork on sites run by other firmsDo sole traders need employers’ liability insurance?
Not if you work alone. Employers’ liability only becomes a legal requirement once you employ someone, but that includes casual, part-time and temporary help, which catches many sole traders out.
You may still be asked to prove you have cover when you:
You’ll usually be asked to prove cover when you:
Sign a commercial leaseTake on a client contractJoin a trade body or associationWork on a construction siteAttend a trade show or market
How much public liability cover does a sole trader need?
How much public liability cover does a sole trader need?
There’s no legal minimum, but most sole traders hold £1 million to £2 million, the level your clients or landlord require usually decides it.
There’s no legal minimum, but most sole traders hold £1 million to £2 million, the level your clients or landlord require usually decides it.
| Level of cover | Typical for | Watch out for |
|---|---|---|
£1 million | Sole traders working alone, low-risk services | May be too low for many client contracts |
£2 million | Most sole traders and small trades | Often the level councils and venues expect |
£5 million | Sole traders on commercial or public-sector contracts | The most widely held level in the UK |
£10 million | Large contracts and higher-risk trades | Usually only needed if a contract specifies it |
Top Tip
Check your contracts, leases and any trade body rules before choosing a limit, it’s far easier to set the right level now than to increase it mid-policy.
What could go wrong for a sole trader?
What could go wrong for a sole trader?
Most sole trader claims come from injuring a member of the public, damaging a client’s property, advice that causes a financial loss, or tools stolen from a vehicle.
Most sole trader claims come from injuring a member of the public, damaging a client’s property, advice that causes a financial loss, or tools stolen from a vehicle.
Someone trips or is hurt while you’re working, and claims against you personally.
Your insurance certificate explained
Once you’re covered, we’ll send your certificate the same day, this is the document clients, landlords and trade bodies ask to see as proof of cover.
Keep a digital copy on your phone. Most sole traders are asked for it on site or at a client’s premises, not at a desk.
Your certificate typically shows:
Your business or trading nameYour insurer’s namePolicy numberPolicy start and renewal datesAny specific conditions
Cover often bought alongside sole trader insurance
Cover often bought alongside sole trader insurance
Most sole traders start with public liability, then add professional indemnity if they give advice, or tools cover if they carry equipment.
Most sole traders start with public liability, then add professional indemnity if they give advice, or tools cover if they carry equipment.
RecommendedPublic Liability
The usual starting point, covers injury to others or damage to their property.
RecommendedProfessional Indemnity
Covers claims that your advice or work caused a client a financial loss.
OptionalTools & Equipment
Covers the tools you need to earn, including theft from a vehicle.
OptionalPersonal Accident
Helps replace income if an injury stops you working, with no employer sick pay behind you.
OptionalBusiness Interruption
Helps with lost income and ongoing costs if an insured event stops you trading.
PopularCommercial Combined
Bundle public liability with your other covers into one policy and one renewal date.
How much does sole trader insurance cost?
There’s no fixed price. Your trade is the biggest factor, a bookkeeper and a roofer face very different risks, even working alone.
Your trade and risk
Working at height or with tools costs more to cover than desk-based work.
Claims history
A clean claims record helps keep premiums down at renewal.
Level of cover
Higher indemnity limits increase your premium.
Level of excess
A higher voluntary excess usually lowers your premium.
Whether you employ anyone
Taking on help, even casually, adds employers’ liability to your policy.
Tools and equipment value
The more kit you carry, the more it costs to cover against theft or loss.
How to get sole trader insurance
How to get sole trader insurance
Getting sole trader insurance takes four steps: tell us what you do, choose your covers, compare specialist insurers, then get your certificate, often the same day.
Getting sole trader insurance takes four steps: tell us what you do, choose your covers, compare specialist insurers, then get your certificate, often the same day.
1
Tell us what you do
Your trade, and whether you employ anyone.
2
Choose your covers
Public liability, professional indemnity, tools and any extras.
3
We compare specialist insurers
We search our panel of 20+ UK insurers.
4
Get covered and get your certificate
Receive your documents, usually the same day.
UK-based specialist advisersAccess to specialist insurersNo obligation, just expert helpTrusted by thousands of businesses across the UK
Trusted by thousands of businesses across the UK
From everyday business insurance to complex specialist cover, our customers trust Insurance Revolution to find the right protection and provide expert support when it matters.
From everyday business insurance to complex specialist cover, our customers trust Insurance Revolution to find the right protection and provide expert support when it matters.
Sole trader insurance guides
Sole trader insurance guides
Practical advice on cover, going self-employed and staying protected.
Practical advice on cover, going self-employed and staying protected.
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Public Liability, Tools Cover, or Both? Choosing the Right Sole Trader Insurance
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Sole Trader vs Limited Company Insurance: What’s Different
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Sole trader insurance FAQs
Sole trader insurance FAQs
Straight answers on what you need, what’s required and cost.
Straight answers on what you need, what’s required and cost.
There’s no single policy. Most sole traders start with public liability, then add professional indemnity if they give advice, tools cover if they carry equipment, and stock cover if they hold goods.
Still have questions?
Our advisers are here to help you find the right solution.