What Insurance Does a Builder Need? Your Guide to Builders Insurance and Contract Works Insurance in Australia

As a specialist insurance adviser for the construction industry, one of the most common questions I’m asked at Grid Insurance is, “What insurance does a builder actually need?” Whether you're a sole trader working on small renovations or a licensed builder managing large construction projects, having the right cover in place is essential — not only to protect your work but also to meet licensing and contract requirements.

In this post, I’ll break down builders insurance, explain contract works insurance, and help you understand what cover might be right for your next project.

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Understanding Builders Insurance: More Than Just a Piece of Paper

When we talk about builders insurance, we’re really talking about a combination of insurance policies that help protect you, your business, and the work you do. It's not a "one-size-fits-all" product — instead, it’s about tailoring cover to suit the specific risks of your construction projects.

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Core Types of Builders Insurance

• Public Liability Insurance for Builders
  This covers your legal liability if your work causes personal injury to a third party or damage to their property. Whether you're working on-site or at a client’s home, accidents can happen — and public liability insurance is often required for your builder’s licence, especially here in Australia.
• Contract Works Insurance (Also Known as Construction All Risks Insurance)
  This is one of the most important types of cover for builders. It protects the actual construction work being done — from accidental damage on-site to theft of materials. Whether you're working on a single home renovation or a large multi-unit development, contract works insurance provides essential cover during the build phase.
• Tool and Equipment Insurance
  Many builders choose to add this to their policy to cover their tools of trade, which are often a target for theft.
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What Is Contract Works Insurance? (Explained Simply)

You might have heard the term contract works insurance (sometimes called builders contract works insurance or construction all risks insurance) — but what does it actually mean?

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Contract Works Insurance Meaning

Put simply, contract works insurance is designed to cover the physical works of a construction project while it's in progress. This can include:

• Materials on-site waiting to be installed
• Work already completed but not yet handed over
• Temporary structures like scaffolding and site sheds

Depending on the policy, it can also cover existing structures if you're working on renovations or extensions (something that not every policy includes by default — so it’s important to check the wording carefully).

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What Does Contract Works Insurance Cover?

• Accidental damage to the project site
• Theft of building materials (before completion)
• Storm, fire, or flood damage during construction
• Vandalism to the site

It can be taken out for single projects (known as single project contract works insurance) or set up as an annual contract works policy if you're managing multiple jobs throughout the year.

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Do I Need Contract Works Insurance?

The short answer? If you're a builder managing the construction, then yes — contract works insurance is highly recommended. In many cases, it's required under the building contract itself.

In particular, in states like Victoria (VIC), Queensland (QLD), and New South Wales (NSW), there are often specific insurance requirements depending on the project type, value, and your licensing class. If you're unsure whether your current policy meets these requirements, that’s where having the right builders insurance adviser (like us at Grid Insurance!) can really help.

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How Long Does Builders Insurance Last?

The length of your builders insurance will depend on the type of cover you choose:

• Annual policies are common for ongoing coverage across multiple projects.
• Single project contract works insurance lasts for the duration of that particular job — from site setup to project completion.

Choosing the right option comes down to the size and nature of your projects. If you're working on several builds throughout the year, annual cover may be more cost-effective.

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Contract Works Insurance Australia: Things to Know

When comparing contract works insurance Australia-wide, it’s important to remember that no two policies are exactly the same. Some key things to look out for:

• Does the policy cover existing structures if you're working on renovations?
• Are your tools and equipment covered while on-site?
• What are the exclusions or limitations in the policy wording?
• Does the insurer require a specific contract works insurance proposal form to be completed?
• How does the contract works insurance calculator determine the premium — is it based on contract value, duration, or both?

These are all questions I regularly help my clients navigate to make sure their cover matches the real risks of the job.

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How Much Does Contract Works Insurance Cost?

The cost of contract works insurance depends on several factors:

• The value of the contract/project
• Location of the work (for example, contract works insurance Victoria vs contract works insurance NSW)
• Whether the policy is annual or for a single project
• Type of construction and associated risks

Every project is different, which is why I recommend giving us a call, an insurance adviser who understands the construction industry — so your policy reflects your actual needs, not just a generic template.

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Final Thoughts: Getting the Right Insurance for Your Building Projects

At Grid Insurance, I work directly with builders across Australia to make sure their insurance policies genuinely protect their projects and meet regulatory requirements. Whether you're looking for builders insurance VIC, builders insurance QLD, or builders insurance NSW, or you’re trying to figure out whether you need contract works insurance cover, I’m here to help.

Need advice on your current policy or want a tailored quote? Reach out anytime — I’m always happy to chat about how we can protect your next project properly.

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