Insuring Your Industry: What Business Insurance Do Construction Companies Really Need?

Construction is one of Australia’s highest-risk industries and without the right insurance, even a minor accident can lead to major financial setbacks. Whether you’re a builder, developer, or subcontractor, understanding which covers are essential is key to protecting your business, team, and reputation.

In this guide, we’ll walk you through the must-have policies, common gaps, and how FergusonBrown helps construction businesses stay compliant and confident on every project.

Why Insurance Matters in the Construction Industry

The nature of construction work — physical labour, heavy equipment, subcontractor reliance, and strict deadlines — makes risk unavoidable. From on-site injuries to contract disputes, your exposure spans legal, financial, and reputational damages.

Without tailored insurance in place, a single claim can:

• Stall a major project

• Lead to breach of contract

• Drain your working capital

• Put your builder’s license at risk

  
  

Core Insurance Policies for Construction Businesses

Here’s what we recommend as a starting point:

1. Public & Products Liability Insurance

Protects you against claims for third-party injury or property damage caused by your work.

• Common scenario: A pedestrian is injured by falling scaffolding at your site.

• Coverage includes: Legal costs, medical bills, property repair.

• Keywords: public liability for builders, construction site insurance

2. Contract Works Insurance (aka Construction All Risk Insurance)

Covers damage to the building works during construction, including theft, vandalism, storm, or fire.

• Common scenario: An unfinished build is destroyed by a storm.

• Also includes: Materials stored onsite and sometimes temporary structures.

• Keywords: contract works insurance, building site cover

3. Plant & Equipment Insurance

Protects machinery, tools, and equipment — owned or hired — against accidental damage or theft.

• Common scenario: Excavator is stolen overnight from a locked site.

• Optional: Mechanical breakdown and road risk if registered for driving.

• Keywords: tool insurance for builders, heavy equipment cover

  
  

4. Workers’ Compensation Insurance

Mandatory if you employ staff in Australia. Covers wage replacement and medical costs for employees injured at work.

• Note: Must be arranged through your state-based workers comp authority.

• Keywords: workers compensation construction, employee injury cover

5. Management Liability Insurance

Covers directors and business owners for claims relating to mismanagement, employment disputes, OH&S breaches, or regulatory investigations.

• Common scenario: A subcontractor files a wrongful termination claim.

• Also includes: Fines, penalties, and legal costs.

• Keywords: builder management insurance, director liability

  
  

Optional Extras Worth Considering

• Professional Indemnity Insurance — for builders who offer design advice or inspections

• Cyber Protection Insurance — especially for businesses managing contracts, plans, or payments online

• Commercial Vehicle Insurance — for utes, trucks, or vans used on-site

  
  
  
  

What’s Not Usually Covered

• Defective workmanship

• Unlicensed work or non-compliance

• Known risks at policy start

• Gradual wear and tear

  
  

➡️ We walk you through exclusions during the policy setup — no surprises down the track.

Why Work with a Broker Like FergusonBrown?

Construction insurance isn’t one-size-fits-all. At FergusonBrown, we:

• Understand licensing and compliance across all states

• Tailor policies to your contract requirements (e.g., government tenders)

• Proactively review your risk exposure each year

• Help you navigate claims quickly

  
  

“Insuring Confidence” means ensuring your business can keep building, even when things go wrong.

Need construction cover that actually fits your risk? Speak to one of our brokers to arrange a customized insurance package at 1300 337 276 or visit: www.fergusonbrown.com.au