In my insurance career, I’ve handled the insurance programs for several folks who started handyman businesses. Some understood the importance of protecting their livelihoods — but there was always that one person who asked the question agents hear all the time:
“I’ve never had an issue on a job in 22 years,” they’d say. “Why do I need to pay all this money when I’ve never even used the insurance?”
I could always point to at least one of my other clients who would have a very different point of view. This handyman was hired to paint some exterior windows. A ladder toppled, knocking over a full bucket of paint onto a flagstone patio. Despite his best efforts, the paint couldn’t be removed, and the homeowner had no choice but to replace the entire patio. Matching the undamaged stone was impossible, and the repair cost nearly $20,000. Fortunately, my client had paid his premium, and his liability insurance covered the cost of the bill.
Let’s break down the math. He paid about $75 per month for insurance to avoid a $20,000 expense that would have been equivalent to nearly $1,700 per month without coverage. In this case, the value of insurance is crystal clear.
Here’s what you should know about insurance coverage if you’re a handyman.
What Is Handyman Insurance?
Policies for Handyman insurance come in different shapes and sizes. It’s important to analyze your business and determine which policies you need, along with the appropriate coverage limits.
Basic handyman insurance usually falls into these categories:
General liability insurance: This policy helps cover costs if a third-party, such as a homeowner, is injured at the job site. For example, if someone trips over a power cord, this coverage can help pay for medical expenses or legal fees.
Tools and equipment coverage: Imagine leaving your van unlocked overnight, only to find the next day that all your tools have disappeared. Tools and equipment coverage (also known as Inland Marine insurance) helps replace your property if it’s stolen or damaged.
Workers’ compensation insurance: In most states, this coverage is mandatory if you have employees. If they get hurt on the job, workers’ comp helps cover medical bills and replace a portion of lost wages.
Given the varied nature of handyman work, risks can appear around every corner. Whether you repair plumbing, heating, or electrical systems, it doesn’t take much for an accident to trigger a costly claim. Handyman insurance helps protect your financial position and provides peace of mind.
Current Handyman Insurance Costs
Take a look at the range of costs you might expect to pay for various coverages. On average, handyman business owners pay a median of:
- $55 per month for general liability insurance
- $21 per month for tools and equipment coverage
- $173 per month for workers’ compensation
Data from Simply Business customers specializing as “handyperson” who purchased at least one or a combination of general liability, tools and equipment, or workers’ compensation policies from July 1, 2024 to December 31, 2024. Reflected price tiers may not include purchase of all available policies under handyman insurance.
Keep in mind that the cost of coverage will depend on factors such as your annual payroll amount, your location, and your claims history.
It’s helpful to view premiums in relation to your expected revenue. In many cases, you could earn the annual cost of your insurance in a single job — yet you’re paying just a small fraction of the potential losses, which could reach tens or even hundreds of thousands of dollars.
Coverage Types and How They Work
There are different types of policies for handyman insurance, and each serves a specific purpose. Here’s how the most common types work.
General liability insurance
Imagine you’re power-washing a home and your ladder crashes through a picture window. The window needs to be replaced, and there’s damage to furnishings inside. Without insurance, the costs could easily be two or three times the amount you charged for the job. General liability insurance helps cover a large portion of that bill.
Tools and equipment coverage
I had a client who stored nearly all his tools and equipment in an outbuilding a few miles from his main location. Thieves broke in, destroyed the security cameras, and stole ladders, scaffolding, and numerous expensive power tools. The replacement costs were approaching six figures, but fortunately, his tools and equipment policy (Also known as Inland Marine insurance) covered most of the loss.
Workers’ compensation insurance
Your employees have things to protect too, such as the financial well-being of a spouse or child. If they’re injured on the job, workers’ compensation helps cover medical expenses and provides income, shielding both employees and employers from financial hardship.
What Might Affect Your Premium
I know one handyman client who mostly does painting and another who focuses on carpentry. Naturally, their premiums may differ. Several factors influence these differences:
Location: Rural areas with less traffic and smaller populations typically carry lower risk and lower premiums than big cities.
Type of work: Riskier profiles or types of work cost more. A handyman who mostly mows lawns and trims shrubs will pay less than one who primarily works as an electrician.
Business size: A one-person operation usually has lower premiums than a handyman with several employees doing the same type of work.
Claims history: One client who filed multiple claims in a year saw his premium double, while a claims-free handyman usually avoids such increases.
Coverage limits and deductibles: Higher limits typically cost more. For example, $1 million in liability coverage for a municipal job is more expensive than a $500,000 limit, though a higher deductible can help offset the cost.
5 Ways to Reduce Handyman Insurance Costs
If luck is on your side and you can avoid claims, here are five additional ways to save:
- Bundle policies: If available to you, keeping your workers’ compensation policy with the same carrier as your liability insurance, for example, may earn you a discount.
- Pay annually: Paying your premium in full can help you avoid monthly or quarterly installment fees.
- Raise your deductible: Higher deductibles typically lower premiums. Keeping the deductible amount in a liquid account provides extra financial security.
- Stay claim-free: Implementing safety programs and following OSHA guidelines can help reduce the likelihood of claims.
- Get certified: Earning certifications from industry-accredited associations may qualify you for premium discounts.
Is Handyman Insurance Worth the Cost?
Even if you believe you can avoid the risks that lead to claims, you might still wonder whether insurance is worth the expense.
The answer is simple: you can’t predict the future. While your bottom line matters, protecting your business comes first.
Consider this: few reputable clients will hire a handyman without a certificate of insurance.
Insurance is essential for protecting your livelihood. You may face out-of-pocket costs for damage to a client’s property — and as previous examples have shown, those costs can escalate quickly. Add legal defense fees to property damage, and a single incident could cause serious financial harm to your business.
Take the Plunge
Even if you never need to file a claim, insurance provides peace of mind every day on the job. Programs can be customized to fit your needs, and a single job could easily offset the value of your coverage. In the end, protecting your livelihood is always worth it.
Don’t wait for an accident to happen. Get a handyman insurance quote and start working with peace of mind.