If there’s one phrase from The Finance Shed hears too often, it’s “She’ll be right, mate.”
That attitude works fine on a Friday arvo, but not when something goes wrong on site.
A ladder slip, a burnt-out ute, a customer injury, or an illness that takes you off the tools for a few months — any of these can sink your income, your business, and your family’s stability overnight.
Most tradies don’t think about insurance until they need it — and by then, it’s too late.
The good news? You don’t have to be an insurance expert to protect yourself. You just need to understand the basics — what policies matter, what they actually cover, and roughly what they cost.
Let’s break down the essential insurances every Aussie tradie should consider, why they matter, and how they fit into your bigger financial plan.
Why Tradie Insurance is Important
Insurance isn’t just red tape — it’s your financial safety net.
As a self-employed Tradie Insurance, you don’t have sick leave, redundancy pay, or an HR department looking after you. If something happens, you are the business.
Proper insurance protects:
- Your income — so bills are paid even if you can’t work.
- Your assets — like tools, vehicles, and equipment.
- Your business reputation — if a job goes wrong.
- Your family’s future — in case of serious illness or death.
Think of insurance as part of your Risk pillar in The Finance Shed’s CARE model — it doesn’t earn money directly, but it keeps everything else standing.
The Core Tradie Insurance Types Explained
Let’s go through the main types of Tradie Insurance should at least consider — and what they actually cover.
1. Public Liability Insurance — Your First Line of Defence
If you only take one type of business insurance, make it this one.
Public liability covers you if your work accidentally causes injury to another person or damage to property.
For example:
- You’re an electrician and accidentally spark a small fire.
- You’re a plumber and flood a client’s kitchen.
- You’re a carpenter and a client trips over your tools.
Public liability pays for repairs, medical costs, or legal fees that could otherwise destroy your business.
Typical cover amounts:
$5 million – basic cover for small jobs.
$10 million – common for most tradies.
$20 million – required for larger builders or government contracts.
Average cost:
Around $400–$900 per year, depending on your trade, turnover, and risk level.
2. Income Protection — Covering Your Pay When You Can’t Work
What happens if you injure your back and can’t work for three months? Or you’re diagnosed with something that keeps you off the tools for half a year?
That’s where income protection comes in.
It replaces a percentage (usually 75%–85%) of your normal income if you can’t work due to illness or injury — keeping your bills, mortgage, and school fees paid while you recover.
Example:
You earn $80,000 a year as a sparky.
With income protection, you could receive around $5,000 per month while you’re off work.
Typical waiting periods:
14, 30, or 90 days (shorter wait = higher premium).
Average cost:
About 1%–3% of your income — often tax-deductible if structured correctly.
Experts says it best:
“Your body is your biggest business asset. If it’s out of action, so is your income. Insurance replaces the pay you can’t earn.”
3. Life and TPD (Total and Permanent Disability) Cover — Protecting Your Family
These two often come together, but cover very different things:
- Life Insurance: Pays a lump sum to your family if you pass away.
- TPD Insurance: Pays out if you’re permanently unable to work again.
These policies make sure your mortgage, debts, and family costs are covered — so your loved ones don’t inherit your financial stress.
Example:
A tradie with a $600,000 mortgage and a young family might take out:
- $700,000 life cover
- $300,000 TPD cover
Average cost:
From $30–$100 per month, depending on age, health, and cover amount.
You can hold life and TPD insurance inside superannuation, which makes it easier to manage and more affordable.
4. Trauma (Critical Illness) Insurance — When Life Throws a Curveball
Trauma insurance pays a lump sum if you’re diagnosed with a serious illness such as cancer, heart attack, or stroke.
Even with income protection, there are expenses that pile up — medical bills, recovery time, home modifications, or time off for your partner.
Trauma cover gives you breathing room to focus on recovery instead of bills.
Average cost:
Between $50–$150 per month, depending on your health and level of cover.
Example:
A 38-year-old carpenter diagnosed with melanoma could receive a $100,000 trauma payout to fund treatment and take a break to recover.
5. Vehicle and Tool Insurance — Protecting What Keeps You Working
Your ute and tools aren’t just gear — they’re your livelihood.
- Commercial Vehicle Insurance covers accidents, theft, and damage for your work ute or van.
- Tool Insurance covers theft or damage to tools (often at work sites or in vehicles).
Example:
A plumber’s ute worth $40,000 with tools worth $10,000 might pay:
- $80–$120/month for vehicle insurance
- $25–$50/month for tool insurance
Check your policy carefully — some only cover tools if stolen from a locked, alarmed vehicle or job site.
Pro tip: Always photograph your gear and keep serial numbers handy.
6. Business Insurance Packs — All-in-One for Small Operations
If you’re running a registered business or have employees, you can bundle covers such as:
- Public liability
- Property damage
- Theft
- Business interruption
- Professional indemnity
These packs simplify administration and can be tailored to your trade.
Average cost:
From $70–$200/month, depending on coverage and turnover.
How to Choose the Right Mix
Every tradie’s situation is different — your trade, income, family, and financial goals all affect what you need.
Start by asking:
- Could I still pay my bills if I couldn’t work for 3 months?
- Would my family be secure if something happened to me?
- Could I afford to replace my ute or tools tomorrow?
- Do I have contracts that require specific insurances?
The goal isn’t to be over-insured — it’s to cover the risks that would seriously hurt your business or family if they happened.
Conclusion:
You spend years building your skills and reputation — don’t let one accident, illness, or theft wipe it all out.
The right insurance cover turns chaos into inconvenience. It keeps the money flowing, your business alive, and your family secure.
Start small if you need to — even a few key policies like public liability and income protection can make a massive difference.