What Does Handyman Insurance Cover?

Key Takeaways:

Handyman Insurance is available to cover independent contractors performing handyman (or woman) tasks, including general liability, business auto insurance, work comp insurance, and much more.
This type of coverage is beneficial when working on your own or through a ‘gig work’ system and protects you and your personal assets in the event of a problem or issue.
As a handyman, you spend most of your time working on other people’s property and things can go wrong. If you or someone else on the job site is injured or property is damaged, Handyman Insurance has the solution.

If you have the carpentry, plumbing, electrical, and general maintenance skills and like being your own boss, being a handyman (or woman) sounds like a great job! You get to set your own schedule, choose your projects, and experience the independence of being a business owner.

But it’s more than that, it’s a business—and with any business, there are risks and responsibilities. Since working as a handyman means being an independent contractor, there are financial considerations needed to protect yourself. Although you hope to never have problems or issues come up, sometimes things happen that could bring costly lawsuits, financial losses, and reputational damage.

That’s where Handyman Insurance comes in—it protects you from the unpredictability of the handyman profession, including being injured on the job, accidentally damaging someone else’s property, and so much more.

The Nuts and Bolts of Handyman Insurance

When you ask yourself, “Why do I need Handyman Insurance?”, it’s to protect you on many levels so that you are prepared should something bad happen. Luckily, insurance providers recognize this profession and its potential problems and have developed cafeteria-style policy options that allow each person to customize their coverage in the most beneficial way.

Let’s take a look at the six main types of insurance coverage that you will want bundled into your Handyman Insurance policy:

General Liability Insurance – Handyman Liability Insurance covers third-party claims when there has been bodily injury or property damage caused (or presumed to be caused) by a handyman’s work. It also covers potential libel, slander, and legal and settlement costs. This type of insurance is often required by most states to obtain a license, and most clients will want to see proof of coverage.

As an example of why general liability insurance is needed—if a customer accidentally trips over equipment or tools left by the handyman, this insurance will cover the medical bills and any legal costs.

Errors & Omissions (E&O) Insurance – E&O insurance is designed to protect the handyman with coverage, so if they received claims about negligence, damages, breach of contract, poor workmanship or shoddy materials, they would be protected. This includes legal defense costs and judgements.
Commercial Property Insurance – Whether rented, leased, or owned, it’s important to have commercial property coverage for any business-owned property, tools, and equipment. This is important coverage in case your property is impacted by unforeseen events, like theft, fire, or loss. The Handyman Insurance cost is well worth the peace of mind when it comes to your ‘tools of the trade.’
Workers’ Compensation Insurance – Getting work comp insurance for you and any subcontractors or employees you may hire provides medical coverage for work-related injuries. Mandatory in most states, work comp coverage provides medical care, rehabilitation, and lost wages for those injured on the job.
Commercial Auto Insurance – If you use your truck or van for business purposes, you will need commercial auto insurance to provide protection from accidents, injuries, and theft or vandalism.
Surety Bonds – Bonds are a great want to build trust and credibility with customers and are usually required on large projects. A surety bond guarantees you, as the handyman, will fulfill their contractual obligations and provides your client with financial consideration if you fail to complete a project.

So, What Types of Issues are Covered by Handyman Insurance?

Think of Handyman Insurance as a great, big safety net protecting you and your personal assets in case of a catastrophe or unexpected situation while working. Here are some of the things that can happen while you are working for a client:

Damage to Someone’s Property – Your General Liability policy covers the cost of repairs and replacements like, for example, knocking over and breaking an expensive piece of furniture while working in someone’s home.
Accidents that Result in Injury – If a customer or bystander slips and falls on a wet floor or over a piece of your equipment while you are working, your Handyman’s Liability policy will cover medical bills and any legal costs.
Professional Mistakes – Policies will provide coverage for any errors, negligence, or unfinished work and protect you from lawsuits for breach of contract. This can happen when taking jobs above your skill level, providing inaccurate quotes for work to be performed, or failing to understand customer service in your client dealings.
Workplace Injuries – When you or a subcontractor or employee is injured on a job, Workers’ Compensation Insurance will help cover medical expenses and lost wages (although work comp doesn’t pay 100% of wages, it can be helpful while you recuperate).

It is always important to only accept jobs within your skill set and only what you are comfortable performing with the resources you have available. While accidents happen, don’t invite trouble by overextending yourself or your crew.

Tool Theft – Growing by an average of 5% each year, tens of millions of pounds of tools and equipment are stolen every year. In 2023 alone, over 44,000 tool theft incidents were reported, which equates to one every 12 minutes. Whether targeting job sites or vehicles, tool theft is a lucrative business and there is high value in reselling tools.

With Commercial Property Insurance, you are protected from theft, either on the job or while tools are being stored and will be able to quickly replace your tools and equipment.

Accidents Involving Business Vehicles – Work-related driving and commuting brings the same risk as other types of driving, maybe more. When you are on the road, having Commercial Auto Insurance is a good investment and will help cover damages or injuries like your personal auto insurance.

Requirements for Handymen and Handyman Insurance

With an inherent risk of injury and/or property damage, people skilled in maintenance, construction, and general handyman activities need good insurance to protect themselves and their loved ones. Here are some of the other business insurance handyman needs and requirements impacting tradespeople when it comes to being an independent businessperson.

Handyman License – Most states require that you operate under a handyman’s license while doing business. This protects both you and the clients and is a great trust builder when proposing for jobs.
Certificates of Insurance – Many clients will expect to see your Certificate of Insurance as proof of coverage. Having a strong Handyman Insurance policy will give you an edge by demonstrating that you are fully covered and a trustworthy contractor.
Business Auto Insurance – While it may seem like a good idea to use your personal vehicle with personal auto insurance coverage for your business, it can lead to disaster. If there is an accident and it can be proven that it was business related, your personal insurance can deny the claim and leave you with total financial responsibility.
Working with Employees or Subcontractors – Workers’ Compensation Insurance not only can help you personally if injured but is mandatory if you employ workers. Calling workers an independent contractor may not be enough to negate your responsibility.

Be sure you understand the difference between employees and independent contractors. The IRS has definitions that cover how you define a worker’s hours, workload, and how the work is to be accomplished, etc., and these definitions can be used against you if there is a claim made for an injury that you didn’t cover through insurance.

Legal and Regulatory Compliance – Many state and local jurisdictions have legal and regulatory compliance requirements that can include:
Business licensing at the state or local level
Contractor’s licensing
Specialized licensing, e.g., HVAC, plumbing, electrical
Permitting and building code compliance
Other Considerations:
- Homeowner Associations (HOAs) requirements
- Asbestos and lead removal procedures
- Trade exams

Finding a Good Insurance Agent

When it comes to managing handyman insurance cost, it’s important to establish a relationship with a good insurance agent that’s knowledgeable about the requirements and options for independent contractors and handymen and women. You want someone who will take the time to explain the different types of coverage available and the benefits of each.

Using a marketplace leader, like einsurance.com, you can find the best price quotes and agents to choose from—then work with your selected agent to help you obtain the best tailored coverage that fits your unique circumstances.

Each insurance company has different premium structures that influence your costs and take into consideration things like scope of work and number of employees. It’s also a good idea to employ regular policy reviews as your company grows, since changing circumstances will lead to necessary adjustments in coverage and premium costs.

A Couple of Quick FAQs

What does Handyman Insurance cost?

While Handyman Insurance costs will vary by the types of coverage you want, the deductibles you choose, your location, coverage limits, claims history, and size of your business, the general policy can range on average from $400 to $1,500 or more per year.

What happens if I choose to not carry Handyman Insurance coverage?

This will leave you extremely vulnerable and could be personally devastating if your business has a problem. It will leave you personally responsible for possible damages, medical expenses, legal fees, and more.

Do I need Insurance if I am a part-time handyman?

Yes—full-time, part-time, any time—if you are working as a handyman, it’s important to carry insurance that will protect you in case of problems.

What if I have coverage, but don’t have a way to prove it?

You should be able to contact your insurance agent or company and request a Certification of Insurance, or COI, which demonstrates that you have a policy in force. Many clients will require you to show or post your COI throughout your project so that information is available if needed.

Is Handyman Insurance required by law?

It depends on your state and local jurisdictions. Most post their requirements online to make it easy for everyone to see their obligations.

Some Final Thoughts

Ensuring comprehensive handyman insurance is the best way to protect your business as an independent contractor. It allows you to safeguard your business, your property and equipment, and your reputation as your business grows.

Once you find a reputable insurance agent that will provide you with information and guidance, you can proactively protect your business and enjoy peace of mind. Remember to review your policy annually to ensure that you are adequately covered and are receiving the absolute best price for your policy.

Contact einsurance.com to learn more about business insurance and find help in locating an insurance agent that can exceed your expectations.