Sole Trader Insurance: Public Liability Cost Guide 2026

Public liability insurance for sole traders costs from around $295 to $1,126 a year, depending on the occupation. Public liability is the cover many sole traders arrange first in their sole trader insurance. Professional indemnity, tools of trade and personal accident and sickness cover are often added, depending on the work.

Business structure is one reason sole traders look at liability cover. According to business.gov.au, a sole trader is "legally responsible for all aspects of the business including any debts and losses". The same page says the structure "has unlimited liability and all your personal assets are at risk if things go wrong."

Cover depends on the policy and insurer you choose. Check the policy wording and its terms and conditions for what is and isn't included.

Sole trader insurance in Australia: quick answers

Sole trader insurance in Australia is rarely one policy. Many sole traders hold liability cover plus one or two other covers. The type of work drives the combination more than the size of the business.

How much is public liability insurance for a sole trader?

Public liability insurance for a sole trader costs from around $295 to $1,126 a year. Occupation is a key rating factor, so a single average says little. The figures come from guides for individual occupations rather than from sole traders as one group. Some cover combined professional indemnity and public liability, so the products are not identical.

Insurers commonly consider these factors when pricing sole trader insurance:

• your occupation and the activities you declare
• your annual turnover
• the cover limit you choose
• your claims history
• where you work and whether you employ or engage anyone

For public liability insurance costs across more businesses, see how much public liability insurance costs in Australia.

Is public liability insurance mandatory for sole traders?

There is no single law requiring public liability insurance for sole traders across Australia. Requirements come from two places: law or registration for some occupations, and the contracts you sign.

Law and registration. These apply to some occupations, not to sole traders generally.

• business.gov.au notes public liability insurance is something "some states and territories need for certain occupations". Check with the regulator for your occupation in your state.
• AHPRA-registered health practitioners must have professional indemnity insurance arrangements that comply with the relevant registration standard, according to AHPRA.

Contracts and permits. These come from whoever you work with, and they often set the cover you hold.

• Commercial leases commonly specify a minimum public liability limit.
• Head contractors commonly ask for a certificate of currency, a document showing your policy is in force, before site access.
• Council permits for markets, stalls and mobile work may set insurance conditions.
• Corporate and government clients often set their own minimum requirement in the contract.

What does public liability insurance cover for a sole trader?

Public liability insurance is designed to cover claims if someone is injured or their property is damaged in connection with your business. A client tripping over your equipment or damage to a client's floor are common examples. The insurer may pay legal defence costs, compensation and any settlement you are legally liable to pay, up to the specified limit.

Public and products liability insurance adds products liability to the same policy. Products liability is designed to cover claims for injury or damage caused by a product you sold or supplied. Cover is subject to the policy terms, conditions and exclusions.

For a fuller explanation of the cover, see what public liability insurance is.

What public liability insurance does not cover

Public liability insurance responds to claims other people make against you, not to your own losses. Exclusions commonly include, but are not limited to:

• loss or damage to your own tools, stock and equipment
• your own injury or loss of income
• the cost of fixing or redoing your own work
• claims that your advice or work caused a client financial loss, which generally sit with professional indemnity
• injury to your own workers, which generally sits with workers compensation
• activities not listed on your policy schedule

Important: This list is not exhaustive. Exclusions vary between insurers. Always refer to the policy wording and its terms and conditions for the exclusions that apply to you.

A sole trader public liability claim example

A sole trader public liability claim commonly involves injury to a client or damage to their property during your work.

Hypothetical example: client injury at a mobile booking

Lisa is a mobile makeup artist in Sydney. During a bridal booking, a client trips on her open kit and fractures a wrist. The client alleges negligence and claims her costs from Lisa.

How cover may respond: Public liability insurance may respond to third party injury claims arising from your business activities, subject to the policy terms.

Important: Claims scenarios are hypothetical examples only. Cover is always subject to policy terms, conditions and exclusions. Policy wordings may also vary between insurers. Always refer to the policy wording and its terms and conditions for details.

When to notify your insurer and make a claim

If you're concerned about a particular customer service or experience, you can always consider telling your insurer as soon as you become aware of an incident, complaint or circumstance that could lead to a claim. You don't need to wait for a formal demand. Also keep in mind that notifying of a claim late may affect your claim.

You can start a claim through the make a claim page. Admitting liability, incurring costs or agreeing to a settlement before you notify your insurer may affect your claim. Starting a claim does not confirm that your claim is covered; your insurer assesses it under the policy terms, conditions, exclusions and limits.

What sole trader business insurance is commonly arranged?

Sole trader business insurance commonly starts with public and products liability, then adds other cover based on the work and the clients. Each cover below is subject to the policy terms.

Public and products liability is the cover many clients, councils and landlords ask to see.

Professional indemnity Insurance is designed to cover claims that your advice, service or work caused a client financial loss. It may include legal defence costs, compensation and any settlement you are legally liable to pay, subject to the policy terms.

Tools of trade cover is designed to cover tools and equipment you take away from your premises against insured loss or damage.

Personal accident and sickness insurance is designed to help protect your income if injury or illness stops you working.

Cyber Insurance is designed to cover costs after a data breach or cyber attack. It is commonly considered by sole traders who hold client records or take online bookings.

For a wider list of covers, see types of business insurance in Australia.

Do sole traders need $5 million, $10 million or $20 million cover?

Sole trader public liability policies are commonly arranged at $5 million, $10 million or $20 million. A lease, contract or permit often sets the minimum requirement. Commercial leases, head contractor agreements and council permits may each name a different figure. Operators working across several clients often arrange the highest limit any of their agreements asks for.

An upcover representative or a broker can talk through what those limits mean for your business. For more on limits, see how much public liability insurance you need.

Sole trader insurance requirements by occupation

Sole trader insurance requirements depend mainly on the occupation, so a general checklist rarely answers the question. A mobile cleaner handles client property daily. An IT contractor gives advice rather than doing physical work, so the main risk sits in a different policy.

Workers compensation rules for Australian sole traders

Workers compensation does not cover sole traders themselves. business.gov.au states: "If you're a sole trader, workers compensation insurance doesn't cover you."

Sole traders who employ or engage people have a separate question. Workers compensation insurance is required where workers fall within the relevant state or territory scheme, according to Safe Work Australia. Each state and territory scheme is governed by different laws and may operate differently.

Who counts as a worker also differs between schemes. In New South Wales, SIRA says some contractors may be deemed workers under the legislation. Check the rules with the scheme regulator in your state or territory.

What is personal accident insurance for sole traders?

Personal accident insurance for sole traders is designed to help protect your income if injury or illness stops you working. Group and personal accident and sickness insurance may pay a weekly benefit after a waiting period, depending on the policy.

business.gov.au notes sole traders "can take out accident and sickness insurance through a private insurer". Personal accident and sickness insurance is a commercial policy with its own benefit limits, waiting periods and exclusions. Workers compensation is a statutory scheme run separately in each state and territory.

Policies commonly vary on how long benefits are paid and whether sickness is included as well as injury. For how the two compare, see group personal accident and workers compensation.

Personal accident and sickness exclusions commonly include, but are not limited to:

• intentional or self-inflicted injury
• injury connected with an illegal act
• pre-existing conditions, unless the insurer agrees in writing

Important: This list is not exhaustive. Exclusions vary between insurers. Always refer to the policy wording and its terms and conditions for the exclusions that apply to you.

Does sole trader insurance cover tools and equipment?

Sole trader insurance may cover tools and equipment where the policy includes tools of trade cover. Public liability insurance does not insure your own gear. Tools of trade insurance, sometimes called portable equipment cover, are arranged separately.

Policies vary in where equipment is covered and the limits that apply. Theft from a vehicle commonly carries conditions, such as the vehicle being locked and secured. Some policies also set a per-item limit, so a specialist tool may need to be listed with its own value. Whether a policy responds to theft from an unattended vehicle varies between policy wordings, so always check with your broker or the team at upcover.

Does home insurance cover a home-based business?

Home and contents policies may exclude or restrict liability arising from business activities, and business stock and equipment may be excluded too. The answer sits in your own home policy wording.

A client tripping on your front step during a paid appointment raises a business liability question rather than a household one. Some insurers permit declared business use and some do not. Sole traders who see clients, hold stock or run equipment at home commonly arrange liability cover in their own name. A business pack bundles several covers into one policy and commonly includes contents, stock and public and products liability.

How upcover can help

upcover arranges sole trader insurance for sole traders across Australia. Covers include public and products liability, professional indemnity, tools of trade, personal accident and sickness and cyber. upcover works with 80+ insurance partners and can arrange quotes from a range of insurers.

• 70,000+ businesses covered across Australia
• 4.9/5 customer rating
• Certificate of currency available once your policy is confirmed

Before you request a quote, it helps to have these details ready:

• your occupation, described the way you actually work
• your annual turnover
• whether you work at your own premises, client sites or from home
• whether you employ or engage anyone
• the cover limit any lease, contract or permit requires
• the replacement value of your tools and equipment

You can compare sole trader insurance quotes for your occupation and turnover.

Frequently asked questions

How much is public liability insurance for a sole trader?

Public liability insurance for a sole trader costs from around $295 to $1,126 a year in upcover's published occupation cost guides. Occupation, turnover, cover limit and claims history are common factors in the cost.

Is public liability insurance mandatory for sole traders in Australia?

Public liability insurance is required for certain occupations in some states and territories, according to business.gov.au. Leases, head contractors, councils and clients often ask for a certificate of currency before work starts.

What does sole trader insurance usually include?

Sole trader insurance commonly starts with public and products liability. Professional indemnity is often added for advice work, and tools of trade, personal accident and sickness and cyber cover depend on the work and clients.

Can sole traders get workers compensation for themselves?

A sole trader is not covered by workers compensation for their own injury, according to business.gov.au. Many sole traders consider personal accident and sickness insurance for income support, though the two are not equivalent.

Is there personal injury insurance for sole traders?

Personal accident and sickness insurance is the cover sole traders commonly arrange for their own injury. It is designed to help protect your income if injury or illness stops you working, subject to waiting periods and benefit limits.

Does sole trader insurance cover my tools?

Tools of trade insurance is designed to cover tools and equipment you take to jobs against insured loss or damage. Public liability insurance does not insure your own tools, so tools of trade cover are arranged separately.

Are a sole trader's personal assets at risk from a claim?

A sole trader's personal assets may be at risk, because business.gov.au says the structure has unlimited liability. Liability insurance may respond to covered claims, subject to the policy terms, conditions and exclusions.

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The information in this article is general information only and does not take into account your objectives, financial situation or needs. Cost figures are drawn from upcover's published occupation cost guides, based on policies arranged through upcover between [DATE RANGE]; they are indicative only, are not a quote and may not reflect your business. Insurance and workers compensation requirements vary by occupation, state and territory and can change, so check with the relevant regulator. Before deciding whether a product is right for you, read the policy wording and its terms and conditions. upcover arranges insurance products with selected insurers and underwriters and does not compare all general insurers or insurance products available in the market.