Business Insurance For Engineers

Compare business insurance quotes with Savvy to find the best policy for your engineering business 

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, updated on July 26th, 2023       

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We’ve partnered with BizCover to bring you a range of business insurance policies to help you compare them side by side.

As an engineer, you’re trusted to be an expert in a diverse range of areas and your expertise is relied upon by many others. The buck often stops on your desk for complicated and expensive construction projects. For this reason, all engineers must have a broad range of insurance policies to offer protection for a range of eventualities. 

You can get multiple quotes for a range of business insurance here with Savvy. Just answer a few simple questions about your business and the insurance you need, and within minutes you’ll have multiple quotes from a range of respected Australian insurers to compare. Whether you’re a civil, mechanical, electrical or software engineer, you’ll be able to find the best-value insurance for your business through Savvy today. 

What types of insurance should I buy for my engineering business?

There are several types of business insurance that engineers should consider, regardless of whether you work as an engineering consultant or you run your own business. These include: 

Professional indemnity insurance 

The greatest risks faced by engineering firms relate to legal liability. Whether a project encounters design issues, or a building or structure fails a compliance inspection, there is always a risk someone will hit you with a professional liability lawsuit.  For this reason, professional indemnity insurance is a must for all engineers and engineering consultants. 

Professional indemnity liability insurance covers you against claims the design service you provided was negligent or fell short of expected professional standards. It’s one of the most important types of insurance and is a compulsory aspect of membership to many professional associations. Cover is available starting at $250,000, but can extend up to $10 million or more depending on the size of the project you’re working on.  

What it covers 

  1. Cover for your legal defence costs 
  2. Payment of compensation if there’s a successful claim against you 
  3. Payment of court-awarded damages to the litigant 
  4. Cover for the cost of disciplinary proceedings or investigations 

Public liability insurance 

Public liability insurance is essential for anyone who works with the public or handles any property belonging to a third party. It will cover you against claims that your business activity caused injury to a member of the public or damaged their property. This insurance can offer between $5 million and $20 million worth of coverage. 

What it covers:  

  1. Third-party personal injury claims 
  2. Damage to a third party’s property 
  3. Legal fees to defend yourself 

General business insurance 

General business insurance may also be worthwhile, particularly if you have tools, portable equipment, machinery or stock to protect. Commercial vehicles aren’t included, so you may need separate commercial vehicle protection for your work ute or truck. 

What it covers: 

  1. Fire, storms, theft, vandalism and collision which cause damage to your business assets 
  2. Specialist cover for electronic equipment and other portable equipment  
  3. Limited business interruption insurance 

Management liability insurance 

Management liability insurance will protect your business owners, managers, senior officers and company directors against the following mismanagement risks: 

  1. Claims of statutory breaches of duty (for instance, breaches of OHSW legislation) 
  2. Statutory fines and penalties imposed as a result of alleged breaches 
  3. Defamation claims 
  4. Sexual harassment claims 
  5. Unfair dismissal claims 
  6. Other charges resulting from OHS incidents or accidents 

Management insurance is highly customisable, so you can choose whichever type of insurance you feel is necessary to make up your business package. Cover is available for amounts ranging from $1 to $5 million. Choose from: 

  1. Directors and officers liability – protecting against losses due to claims of alleged wrongful acts in their capacity as a company director or officer 
  2. Corporate liability – protects the company itself against claims of alleged wrongful acts 
  3. Employment practices liability – which covers the company from claims made by employees concerning working conditions or laws 
  4. Statutory liability – which protects the company itself and senior management and employees from allegations of breaches of key legislation 
  5. Crime – covers against direct financial loss as a result of theft or attempted theft from your business premises by either an employee or third party 
  6. Tax audit – which covers any additional expenses necessary to comply with an ATO-ordered tax audit 
  7. Superannuation trustees liability – which provides protection against any alleged act, error or omission arising due to a person’s status as a Superannuation Trustee 

What it covers: 

  1. Legal and defence costs 
  2. Investigation costs 
  3. Fines and penalties 
  4. Damages awarded 
  5. Claimant costs awarded against the insured 

What isn’t covered under my engineering business insurance? 

The most common general exclusions include: 

  1. Injury to yourself or your employees (which will be covered under your workers compensation insurance
  2. Insolvency 
  3. Wages liability 
  4. Superannuation liability 
  5. Flood damage 
  6. Unlawful activity or criminal negligence 
  7. Reckless behaviour or intentional damage 
  8. Anything to do with asbestos 
  9. The effects of pollution caused by your business activity 

How much will my engineering business insurance policy cost? 

There is no set cost for an insurance policy, as each applicant is different and faces unique risks. Many factors influence the cost of business insurance, including the following:   

  • The state you’re in  
  • Whether you live in a rural or urban area 
  • Whether you’re a consultant, in a partnership or running a larger business 
  • Your business size and turnover  
  • The number of employees you may have 
  • Your insurance history 
  • Whether you’ve made an insurance claim in the past five years 

The main factor which will affect the cost of your insurance is the industry you’re in. All businesses in Australia are classified according to the risk their industry poses, and are allocated a risk ratio. These ratios are used by insurers to calculate the comparative risk of any one engineering firm compared to another.  

However, the cost of public liability insurance for a company in the Australian Capital Territory may not be the same as the cost for a similar engineering company in Perth, as location also plays a part in determining insurance risk. 

You can find out how much public liability insurance will cost for your business in your state by comparing quotes right here with Savvy. Whether you need insurance just for yourself, or for your company, you’ll be able to find a policy that is perfect for your business needs right here. 

Why do I need business insurance as an engineer?

You’ve worked hard to get qualified and set up your own business, so it makes sense to want the best protection just in case things do go wrong. Engineers are particularly vulnerable to personal lawsuits because of the responsibility that comes with the job. Professional indemnity insurance offers protection in case anything happens to you personally. This means if the claim or case goes against you, you won’t have to sell your home or declare bankruptcy to pay for your legal defence or expensive damages claims.  

Other forms of insurance such as public liability and management liability can protect you against different types of lawsuits, which can either be brought by a member of the public or a disgruntled employee. Whether you’re a civil engineer, builder or carpenter, this type of business insurance can potentially save you from claims which can amount to thousands if not millions of dollars.

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Frequently asked questions about business insurance for engineers

How long is an engineer legally responsible for a building?

An engineer or architect who draws up the plans for a building is liable for damages for 15 years from the completion of the structure. For this reason, it’s very important to retain your professional indemnity insurance for several years even after you may retire from the profession. 

What information will I need to make an insurance claim?

The information you should have to hand when you contact your insurance company to make a claim will include: 

  • The name of the policyholder 
  • Your policy number and start date (which can be found on your Certificate of Currency) 
  • A detailed description of the incident (and what happened to cause the damage or loss) 
  • Specific dates and times when the incident happened 
  • Contact details of any other parties involved (or witnesses to the event) 
  • Details of your police report number (if a crime took place) 
  • Details of the property lost or damaged (including its age and value) 
  • Your bank details for settling the claim 
Are my engineering business insurance premiums tax-deductible? 

Yes – the Australian Taxation Office recognises that having business insurance is a legitimate cost of doing business, so the full cost of your insurance premiums can be claimed as a business expense and offset against your income. 

Can I get business insurance if I’m a sole trader?

Yes – business insurance is available for sole traders as well as for companies and partnerships. As a sole trader, such as an engineering consultant, you take personal responsibility for all aspects of the service you offer to clients, so it’s more important than ever to have great business insurance to protect you. 

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