When you're hiring a builder or another tradesperson for work on your home, public liability insurance is one of the first things worth asking about. It isn't the same as home warranty insurance, and there isn't one Australia-wide rule that every tradie must hold it. Still, many licences require it, most contracts expect it, and without it you can be left exposed if something goes wrong on your property.
This guide explains what public liability cover generally does, how it differs from home warranty insurance, what official sources say in a few key states, and how to check your tradie has it before work starts.
What public liability insurance covers
Public liability insurance is a policy the tradie (or their business) holds. It is designed to cover them if someone is injured, or another person's property is damaged, as a result of their work. That might include a visitor hurt on site, damage to a neighbour's fence, or an accident during building or renovation work.
According to the NSW Government, public liability insurance covers the builder or tradesperson if anyone is injured as a result of the building work. NSW also notes that if they don't have it, you could be liable because you own the property. That is why asking for proof before work starts matters as much for you as it does for them.
Public liability is different from:
- Contract works (or construction) insurance, which generally covers materials and the works themselves while the job is underway.
- Workers' compensation, which covers employees if they are injured at work.
- Home warranty / domestic building insurance, which is a safety net for homeowners if a builder can't finish the job or fix defects. We cover that separately in home warranty insurance explained.
Is it required for every tradie?
There is no single nationwide rule that every tradie in Australia must hold public liability insurance. Requirements depend on the trade, the licence, the state or territory, and what your contract says.
In practice:
- Some licences require public liability (or similar) before the person can be licensed or renew.
- Most written building and renovation contracts expect the contractor to hold public liability, and often contract works insurance as well.
- Homeowners should still ask for a current certificate of currency, even when the law doesn't force every trade to hold cover.
The QBCC advises Queensland homeowners to check that the contractor has met the insurance obligations in the contract. It notes that most contracts require the contractor to have public liability insurance and contract works insurance, and that the homeowner may also be required under the contract to take out public liability. Queensland Home Warranty is separate and mandatory for residential construction work above the scheme's threshold — it does not replace public liability.
Always check with your state or territory regulator for the current rules for the trade you're hiring.
Examples where licences set a minimum
Some licensed trades have clear minimums set by regulators. Two official examples:
In Queensland, WorkSafe Queensland says electrical contractor licence holders must hold public and products liability with a limit of indemnity of at least $5,000,000, plus consumer protection insurance of at least $50,000 (under section 165 of the Electrical Safety Regulation).
In Victoria, the Victorian Building Authority explains that licensed plumbers are required by law to obtain insurance before being licensed. Public liability and completed work insurance must be a minimum of $5 million for any one occurrence under the Ministerial Order.
Those figures apply to those specific licences. Other trades and states can differ, so treat them as examples, not a national standard for every builder or handyperson.
What about cash jobs and sole traders?
NSW Government guidance also covers a practical gap: a tradesperson who doesn't operate under a trade or company name generally cannot take out insurance to cover themselves in the same way a business can. In that situation, the homeowner should make sure their own home and contents insurance is up to date, and think carefully before engaging someone who can't show business insurance.
If someone only wants cash, won't put anything in writing, or can't produce a certificate of currency, treat that as a red flag. Prefer a written quote and a clear contract that sets out insurance responsibilities.
How to check before work starts
Before you pay a deposit or let work begin:
- Ask for a certificate of currency. It should name the business, show public liability (and any other required cover), the insurer, the limit, and the expiry date.
- Check it matches the quote. The business name and ABN on the certificate should match the quote and invoice.
- Confirm it's current. Cover that expired last month doesn't help you next week.
- Read your contract. See who must hold public liability and contract works insurance, and whether you have any obligations as the homeowner.
- Keep a copy. Store the certificate with your contract and plans.
Public liability vs home warranty
It's easy to mix these up. Public liability covers injury and third-party property damage arising from the work. Home warranty (also called domestic building insurance or similar, depending on the state) protects you if the builder dies, disappears, becomes insolvent, or — in some schemes — fails to complete or rectify work. You generally need both in place for larger residential building jobs, but they do different jobs. See our guide on home warranty insurance for when that cover is usually required.
Finding a covered tradie
When you compare quotes, ask each business for their current public liability certificate and how they'll handle any other insurance your contract needs. You can use Find My Tradie to find and contact builders directly, including builders in Sydney and builders in Melbourne, as well as electricians and plumbers. Get two or three written quotes so you can compare price, timing, scope and insurance — not just the bottom line.
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Frequently asked questions
Is public liability insurance the same as home warranty insurance?
No. Public liability covers injury and damage to other people's property arising from the work. Home warranty (or domestic building insurance) is a separate safety net if the builder can't finish the job or fix defects. Larger builds often need both.
Can I insist on seeing a certificate of currency?
Yes. Ask for it before work starts and before you pay a deposit. Check the business name, cover type, limit and expiry date match what you were told.
Does every handyperson need public liability?
Not under one national rule. Some licensed trades must hold it to keep their licence, and most contracts require it. For anyone working on your property, it's still wise to ask for proof and to keep your own home and contents insurance current.
What if my tradie says they don't need insurance for a small job?
Requirements depend on the trade, licence and contract. Even for smaller jobs, ask what cover they hold and check your contract. If they can't show any cover, weigh the risk carefully and check with your state regulator if you're unsure.
This guide is general information only, not legal or financial advice. Rules change, so check the official sources linked above for your state.