I’ve been a pro handyman for over a decade, and I’ve learned more than my fair share about handyman insurance.
In this article, I will share everything you need to know about getting your handyman business insured so you can be confident that you’re getting the right coverage without paying too much.
Handyman Insurance Must Knows
What type of insurance do you need for a handyman business?
Insurance can be complex.
In fact, there are at least five different types of insurance that insurance companies will try to sell you (more on these later).
However, most self-employed handymen will only want one kind of insurance: general liability insurance.
Handyman liability insurance will cover things like if you accidentally flood the basement or a customer trips on an extension cord and sues you. It protects you from being financially liable if you damage a customer’s home or if the customer gets injured while interacting with you or your equipment.
Getting liability coverage is a good idea because a tiny mistake could put you in severe financial trouble or force you to shut down your business for good.
Is handyman insurance required to operate a business?
Unless you are a licensed contractor or trying to become one, insurance is usually NOT required to provide handyman services. It’s just a way to limit the risk if you damage a customer’s home or belongings and to gain credability.
But do you need it?
The answer to this question is going to depend on several factors. If you answer yes to any of the following questions, it’s probably a good idea to go ahead and get it.
- Is insurance required by your state to perform home repairs?
- Does your target market include apartment complexes or businesses? (They will often require proof of insurance before starting.)
- Are you planning to work on bank-owned properties? (They also require proof of insurance.)
- Are you planning to get a contractor’s license?
- Are you well-established and can easily justify the expense?
- Will you be performing plumbing and electrical work?
- Do you wear a helmet everywhere you go?
If you answer no to all the questions above, consider waiting to insure your business until you provide regular services or come across a client who requires it.
Some people will say better safe than sorry, but for many people who are just starting and working solo, the risk is low, and the money would be used more effectively toward other areas of growing a business.
However, I wouldn’t go too long or take on electrical or plumbing jobs without general liability handyman insurance. It’s important because it not only protects you, but also your customers in the event of an accident.
How much does handyman insurance cost?
You can expect to pay between $480 to $1000 per year for a typical general handyman liability insurance plan ($40 – $83 per month). Your premium will depend on where you live, your services, sales volume, and your number of employees.
For example, if you offer power washing or roof repairs, you’ll likely have to pay a little extra since these services are more likely to lead to a claim.
The general liability insurance policy for my handyman business costs me about $49 per month, which is great because I used to pay $83 per month for similar coverage until I found a better option (more on that below).
According to Insureon, the median price for a handyman general liability policy is $69 per month or about $825 per year. Unfortunately, construction and contracting businesses tend to pay the highest premiums for liability insurance.
The best way to ensure you aren’t paying too much is to get at least two quotes (see below for where to go). But as long as you are in the range I mentioned above, you’re doing just fine.
Regardless of what it costs to be licensed and bonded, this expense is passed on to the customer, adding about $1 per hour to your hourly rate if you work as a full-time handyman. Remember, insurance protects you and your customers if you make a mistake, which benefits your customers.
What to look for in a handyman liability insurance policy
A typical handyman liability insurance plan for a self-employed handyman will have the following coverage:
- Between $300,000 and $1,000,000 of liability coverage per claim.
- Between $300,000 and $2,000,000 per year aggregate coverage limit.
- Between $0 and $1,000 deductible
That means if you file a claim, you are covered up to $1 million per incident, with a maximum of $2 million per year. Hopefully, you won’t cause that much damage to a customer’s home. And if you do, hopefully, you filed as a multiple-member LLC or a corporation to protect your personal assets from business risks – which is one of the cheapest forms of insurance you can get.
Additional Types of Handyman Insurance
While most handypersons and contractors will only need a general liability policy, there are five more types of handyman insurance to consider and review. So, if you plan to hire employees and scale your business, the insurance situation gets much more complicated.
#1 – Commercial Auto Insurance
You’ll need commercial auto insurance if you drive a business-owned vehicle. Also, it’s important to know that a typical personal auto insurance plan only covers you for personal use – NOT business use. Average prices for commercial auto insurance are a bit higher for handymen because we drive to the job site, so you can expect to pay anywhere from $150 to well over $200 per month.
Of course, you could use your personal vehicle (like most handymen) and upgrade your current auto insurance plan to cover you for commercial use.
#2 – Commercial Property Insurance
Commercial property insurance is often necessary if you have a business located away from home or carry a lot of inventory. It would protect you from theft or property damage caused by fire, accidents, or natural disasters. It can also cover your tools and business equipment, but only when located on your property. It doesn’t usually cover your tools and equipment while driving around.
Most handymen wouldn’t need commercial property insurance because they work out of their homes and have little inventory or equipment. But obviously, it’s important to consider your unique situation. If you have a large dedicated workshop at home with tens of thousands of dollars in tools, it may make sense to get commercial property insurance.
#3 – Workers’ Compensation
Workers’ compensation insurance is required in most states if you have employees. It covers your employees (and you) if injured on the job. It will provide reimbursement for lost wages and medical expenses. Workers comp also protects you from lawsuits injured employees could file against you.
For self-employed handymen with no employees, worker’s comp is optional. However, some will still opt for coverage since it provides a financial cushion when they get injured and can’t work for a while.
#4 – Tools and Equipment Insurance
Unfortunately, general liability coverage doesn’t cover your tools and equipment if they get stolen or prematurely damaged. Neither does commercial auto or property. So, if you pack around expensive tools and live in an area where they are likely to be stolen, then forking over an extra $12-$45 per month for tools and equipment insurance may be worth it.
#5 – Professional Liability Insurance
Also known as Errors and Omissions (E&O) Insurance, professional liability insurance protects against negligence claims and is typically employed by consultants, attorneys, architects, and other professionals who give advice or provide licensed professional services. E&O Insurance doesn’t make sense for most handyman businesses, but it’s more valuable for some contractors who sell their expertise or manage other sub-contractors.
What coverage do you actually need?
Some insurance for your handyman business is essential, but it’s easy to go overboard when insurance companies use scare tactics to encourage you to buy more.
Of course, you want to be covered against situations that could put you out of business or ruin you financially. But you only want what you need because insurance can eat into your profits. Plus, no matter how much insurance you buy, you can’t protect yourself from every situation.
Risk is inherent in life and business, and no amount of insurance will change that.
That’s why when I’m presented with an opportunity for insurance, I ask myself the following question…
“If something goes wrong (even if unlikely), will I be able to cover the damages without ruining my financial health or ending my business?”
If not, then insurance is a good idea. But if I can cover the damages myself, I know I’ll save money in the long run by limiting the amount of insurance I have. By having a cushion in my savings account, I can self-insure myself when more minor things happen.
For example, despite having tools stolen from my truck in the past, I still don’t believe in purchasing insurance to cover my tools. That’s because even if all of my tools were stolen from my truck (which would be hard to do), I could replace them for a few grand. Certainly not ideal, but it’s not going to ruin me financially. The hundreds of dollars per year I save by NOT buying insurance will more than compensate for this over time, even if my tools get stolen.
Additionally, insurance is a pain the ass to deal with. First, you have deductibles. Have one or two tools stolen? It probably won’t meet the deductible. Second, you must file a claim, which takes forever and can be a massive headache. So, let’s say all of your tools are stolen. It’s not like your insurance company will write you a check that day and help you shop. They are going to make you jump through hoops to get your money. People rarely consider these inconveniences when purchasing insurance.
But if you really mess something up? Like if you drilled a hole through a pipe and caused $500,000 in water damage? That would put most people out of business, so insurance makes sense.
That’s why a general liability policy makes sense for most pro handymen and contractors. Just don’t go overboard and invest all of your profits into insurance.
Getting quotes – What’s the best place to get handyman insurance in 2024?
Best overall handyman insurance (what I use)
The best and easiest place to get a competitive quote is Next Insurance. All you have to do is answer a few questions online, and you’ll get a customized quote within seconds – no commitment necessary.
Next offers yearly insurance plans and is an excellent option if you are a part-time or full-time handyman and want a great rate on high-quality insurance. There are no contracts with Next, and you can cancel anytime.
You can purchase just a general liability policy or upgrade and get tools & equipment, commercial auto, commercial property, and even worker’s comp insurance if needed.
Next has the most competitive rates and does not require a year-long contract. You can cancel at any time with no additional fees or penalties.
Next is super easy to use. It takes minutes to get a quote, and you can start your insurance immediately. They also have an app that makes it easy to demonstrate proof of insurance or turn your policy on or off. And if you want to add additional insurance later, you can do that directly from the app.
Honestly, it’s too easy and good not to get a quote. That’s why I use Next for my handyman business, and I couldn’t be happier.
Best on-demand handyman insurance
On-demand insurance is a relatively new concept. With Thimble, you can get insured for a month, a week, a day, or even just a few hours.
For example, let’s say you are just starting your business and aren’t ready to commit to a yearly insurance contract. You can sign up with Thimble (which is super easy, just click the link above) and turn your insurance on for however long you need it.
Or, let’s say you land a few power-washing jobs, but power-washing isn’t covered under your current general liability insurance plan. You can jump on Thimble’s website, set up insurance for just when you do those power-washing jobs, and you’re good to go.
There are multiple scenarios where on-demand insurance makes sense, so this is a cool option. However, convenience does come with significantly higher rates. I tested it out one day for a fence repair job where I was worried I might hit a water line while digging, and it cost me $65 for just that one day. That’s more than my monthly premium with Next.
But if you’re in a bind and need insurance fast, Thimble is a good option.
Getting handyman insurance the traditional way
Online insurance providers like Next or Thimble are great options that make getting insurance a breeze. However, you could do things old school and find a local broker instead.
To do that, do a quick Google search for “contractor insurance” or even “handyman liability insurance,” and you should get at least a couple of local results. However, the best option would be to ask for a referral from a friend.
The main downside of going with an agent is it can be slightly more expensive. Another downside is that it takes longer since you must meet them in person, sign documents, and often wait for them to contact you. With online insurance being so good now, it’s difficult to make a strong argument for this way of doing things.
Where to get your handyman insurance quote in minutes
Here are two of the best and easiest places to get a quote specializing in handyman insurance.
- Next Insurance – (This is what I use) Great for a full-time handyperson looking for good insurance at competitive rates.
- Thimble – Great if you need insurance for a short time window or for a single job that isn’t covered by your other plan.
Want to learn more about how to start a profitable handyman business? Check out my in-depth post on handyman business licenses and laws.
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Great article concerning handyman insurance. The Association of Certified Handyman Professionals – ACHP, offers its members general liability insurance through its ACHP Insurance Program. Great for the experienced and startup handyman businesses. Build your credibility and become a member.
I been reading about this association any feedbacks?
Hi Diana,
Sorry, I have no experience with this. My thoughts are that if I don’t even know what it is, then how will it build my authority?
ACHP insurance is written by Next Insurance.
Diana and Dan,
The Association of Certified Handyman Professionals (ACHP) is a not-for profit handyman trade organization created by the handyman for the handyman. Our members have the general skills and knowledge of the trade. Feel free to contact us or call if you have any questions regarding handyman insurance, membership, our benefits, etc.
Anyone have advice on getting general liability in New York City for Handyman. Cheers
Hi I’m in co springs starting a handyman business can you help with insurance and license please
Hey Rodney, in CO Springs, you don’t really need a license if you take on certain jobs. I would totally recommend getting insurance though, with Next insurance. It’s online and can be done in a couple of minutes. It’s super simple. Anyways, happy handymanning.
We are just interested in mowing and moderate landscaping. I also considerate doing some pressure washing mainly on residential and only single story homes unless the two story is not ridiculous enough to rent a lift or scaffolding.
Where do you go through for handyman insurance in Nevada?
Just find a local insurance agent who offers insurance to contractors. I can’t remember the name of mine off the top of my head.
like get professional with my business
I’m trying to start a handyman service in Southern California. I’m not sure if I’m only allowed to charge 500.00 per customer , per job or per day ? And I also do not know what to charge per hour I’m use to giving deals but I’m trying to start a business so I don’t have to struggle as much I plan on taking the general contractor test for a license in the near future when I can make money. I want to get my DNA and insurance also what is the proper invoice or job walk work order do i use since I’m not able to go over 500 . And can I start a website without DBA and ins.
I charge 130 first hour labor and travel 50 dollars every hour after.
When I had a cabinet shop i used a D.B.A. doing business as , the bank sets that up for you when you open an account.
But now that I am retired I use an Invoice book to keep sales recorded and customers copy. And just use my true name. I use a 1/2 sheet size and use the back for job notes for taxes, reporting income/expenses.
The one important cost I found is auto expense, I started with Mile-I.Q. seems an easy aid.
You probably are not learning anything new here but I like to toss my hat in.
Where did you get your invoice and est tform
I would like to get more information about the costs of starting my own handyman business please
It’s great that this post shows some people that their business might not need insurance yet. That’s very helpful. At what point were you in your business when you got insurance. You waited until your income could support it?
Yes, I waited. I was taking a risk by not getting insurance, but at that point the risk was acceptable.
Its a great information..Handymen don’t typically need multiple different coverage types for their business.
Do you have a recommendation for insurance on my tools, which I carry in a cargo trailer.
Do you have your trailer insured through the business? If so, I would call that insurance company to see if they offer theft protection.
Some of you ask about the problem of personal loss through theft.
I have a long history of dealing with this business cost.
Expect that you may have things stolen.
I welcome this now, it gives me an oportunity to replace old crap with new stuff.
I buy second hand tools if they are a good value
I throw some paint on my tools to reduce the resale value.
I buy cheep Chinese knock off tools that I get at Harbour Freight for a cost I can write off on the first job.
My advice to theves is:
You get what you give, you steal stuff,you will never be secure in your property. Is that the life you want?
If your property is the result of honest work you can be proud of yourself, and sleep securely.
It is hard to work and not have sufficient to give to charity, but theves never have enough even for themselves.
If wishes were horses, beggers would ride.
FYI: NEXT is not available in Florida yet. I just tried.
Thanks for letting me and others know Lydia!
I got a few quotes from them today (I am in FL) with no problems
This has been a wealth of knowledge i thank you all so much. I am a man who has earned all he has on his own since i was 12 yrs. Old put to the streets gone from eating from trash,sleeping in dumpsters, as a kid to having my own fam. Trying to give them better life then i once had.
Good back ground information, though living in NH there are few rules behind the business. Is there a base level for all States that is recommended?
Yes, usually you need $1 million net coverage – which is the typical offering by most insurance companies.
We have recently started our new Handyman service company and came across this article. Really appreciate you taking the time to write this article. I would have never thought that taking any electrical or plumbing work could be a hinderance to our customers but it makes perfect sense. Insurance by no means is an exciting topic to write about but you did an excellent job keeping it entertaining and not boring. Thanks a ton.
I have a contractor liability policy for over 10 years. I’m in Canada and it costs about 1k a year.
I called up the broker and asked just what work I’m covered to do. She said give me an example and I’ll tell you if it’s covered.
It gets vague… for example, a leak in a roof…. fix it and cut out re do the drywall underneath? No, that’s mold remediation, so not covered. Replace set of taps?… NO no no, nothing to do with water, don’t even ask about electricity!
So what am I covered for then ?? She said replacing door knobs and caulking, things like that! I said it say building complete buildings up to 3 stories high on my policy…
And that’s how the conversation went downhill from there.
I’m glad I came across your site. Didn’t realize that you need that much insurance. I’m starting a handyman service in ocean springs, ms and your information will really be useful. Thanks again.
First of all, WOW! Starting up a handyman group in Little Rock, Arkansas and I’m thankful to have read this along the way of opening shop. Will definitely apply this knowledge to my services! Once again, thank you!
So, you’re insured… but you are not licensed or bonded? I’ve been a little confused as the what is required. Do some states require you to be bonded? I know at over $500 per customer I must have at least a basic license(call a Home Improvement Contractors License in CT… often referred to as “any HIC can do that job” by folks with general contractors licenses) in order to do any job over $500 IN BOTH LABOR AND MATERIALS.
I do commercial maintenance work, my insurance company says if I have someone help me temporarily, my policy will cover him as long as he’s doing the same work as I am…is that true?
It is if the company that insures you says so in writing on your policy.
I’m looking for Handyman Ins. I’m 74 1/2 yrs. old doing this part time but the building I live in and work in requires 500,000 liability. Most Ins. companys are too expensive for a retired handyman working part time. Any suggestions? I’m in New Jersey.
My husband and I are starting a handyman business in SC and all of this info is very useful! One question I have is do you get the business license before getting general liability insurance? Or vice versa? Sorry if that’s a stupid question. Any helpful tips and advice would be appreciated.
I would get a business license first, but i’m not sure it matters.
-Dan
Looking for a quote for general liability and workmans comp just for myself
I’m looking to re-start my home repair service, I hope to do home onspections as well once studies are done. Will Handyman Insurance E&O cover inspection or will I need a separate insurance?
I was with AmFam few years back, that was $1k a year in utah. Finding Insurance is not easy here
That was a very comprehensive article on handyman insurance! I particularly liked how you explained what sort of handyman insurance coverages you’d need depending on any situation. Looking forward to read more.
Dan,
A lot of good information here. I have been with Next over two years. My premium went from $52/month for GL to $178/month with no claims! I had my local agent do some shopping…back to around $50 a month again. I am so disappointed with Next. Just wanted to let you and others know my experience.
Thanks
-John Handyman in Tulsa
Thanks, John!
Try between $980 to $1965. annually. What many in this industry don’t understand is what does their underwriter cover. General liability does not cover ones tools, neither does ones auto or homeowners policies if using tools for profit. Also ask underwriter specifically what task are covered. Majorities of policy do not cover soft roof washing, pressure washing houses, interior carpentry, appliances repairs, gutters and window cleaning above 12 feet.
Be sure what your policy does cover handy persons before a claim occurs.
Finally if doing commercial ask about Subrogation Waiver.
Great content and spot on. Insurance is a must especially as you grow. we do a lot of water damage restoration, so its always good to have a safety net. IF all you do is drywall repair, the risk is much lower.
Me & my buddy just started our handyman business in TX. & was just wondering what insurance should i get since we still have our FT jobs & doing handyman jobs on the weekend until it blows up & we can do this full time. I got offered to do make readys at an apartment & first thing they asked was for insurance..
Yes, apartments always require insurance. The cheapest option is still going to be a company like NEXT.
The Association of Certified Handyman Professionals (ACHP) is a not-for profit handyman trade organization created by the handyman for the handyman.I would totally recommend getting insurance though, with Next insurance. It’s online and can be done in a couple of minutes. It’s super simple. Anyways, happy handymanning.
Hi there. Question.
I do small paint jobs in Oregon. To get workers comp. Insurance do I need a business license? I work solo.
Thanks for your time. William
I’m not sure, William. The best way to find out is to try to get worker’s comp and if they tell you that you need a business license, then get one.
I am looking to start a business and this seems to have the help I need to get started! Thank you.
Glad to help!
My husband is a handyman and he’s looking for insurance and this article is great! Do you have any recommendations for lawyers or what to do when clients refuse to pay for work that’s been done? Or a job that is literally one days left of work and the clients decide to “have another contractor finish” and refuse to pay for the work that he has done and completed?
Awesome. Thank you!
I enjoyed that thoroughly considering I used next insurance after I became a one man company. Before that I had a agent can employee in a big pain in the butt insurance bill got hit for $50,000 worth of stolen equipment and my dumb butt the insurance died the night before at midnight and I told the truth it happened on Sunday not Saturday night I was there Saturday night but I could have lied if I would have thought about it but I I’m not that way. I have so many stories of everything that happened to me in business for 20 years when I had employees and you know big jobs going on and stuff and then one day I just did I’m going home I’m retiring and I’m going home y’all can just go home too. You hit it perfect with next insurance I’d like their deal. Kind of made me mad on seeing how much insurance had screwed me for 20 years but like you said you had a agent you could call. Thank you Duane wheeler
Formerly wheeler pump company. Dallas Texas for like I said 20 years I’m going to do a little handyman deal with just by myself. Thank you again Duane
Hey please send me updates on Handyman Business as you do a great job with all your information, keep up the great work & thank you for what you do to help others become better business oriented.
Great Job
Steve