Guides to IT Contractor Insurance - PI Cover

Most contractors take out some kind of business insurance to protect them in the event of a claim against them from a third party, such as a dissatisfied client.

The vast majority of contractors will never need to claim on their business insurance policies, however cover can provide peace of mind just in case something goes wrong on a client site.

The price of tailored contractor insurance has remained competitive over the past decade. For an instant business insurance quote, try Hiscox.

Professional indemnity (PI) insurance

This type of policy will cover you in the event that you make a mistake while working for a third party. You will be covered for things like negligence, loss of data, dishonesty, and unintentional intellectual property breaches.

PI insurance schemes are tailor made for professionals who provide advice to clients - such as consultants, accountants, and contractors.

Increasingly, more and more end clients now insist that any contractors working for them have adequate PI cover in place, so you may find that cover is mandatory rather than optional.

You can find out more in our professional indemnity guide.

Employers' liability insurance

Any business which has employees must take out EL cover by law, however if you are the only employee of your limited company (or are working with close family members only), cover is optional.

EL insurance will cover limited companies in the even that one of their employees is injured (or worse) while working.

The legal minimum level of EL cover is £5m, but most insurers provide £10m of cover.

Read more detail in our guide to employers liability insurance for contractors.

Public liability insurance

Public liability cover will protect you against third party claims from members of the public. An optional insurance, this will cover you in case someone sustains an injury while visiting your office (unlikely for most contractors). It will also cover you in case you cause damage to property on a client site, which is perhaps more useful for IT contractors.

Try our concise guide to public liability insurance for contractors.

More insurance options

Many insurers provide a contractor insurance package which will include PI, public and employers' liability cover for one single premium. This will typically be cheaper than buying the component parts separately.

Other 'add ons' include office insurance (contents), equipment cover (in case you damage your laptop, etc.)

Another wise investment will protect you in the event of an HMRC tax investigation (including IR35 investigations). Depending on the type of policy you take out, you will be covered for all the costs of representation, and even the costs of any tax liabilities you are subsequently found to owe as a result of an inspection.

Read more in our guide to IR35 investigation insurance.

Get a contractor insurance quote

You can get an instant online quote via our business insurance partner, Hiscox.