Written by Candice Klau, Managing Director, Be Covered Insurance Brokers
Candice has more than 20 years of insurance broking experience and specialises in construction insurance for builders, developers and trade businesses across Australia.
For many builders and construction businesses, the end of financial year is one of the few times when there is space to step back and review the business properly.
Projects may be wrapping up. New tenders may be on the table. Equipment purchases, turnover, subcontractor use and upcoming contract requirements are often being reviewed with accountants, bookkeepers and advisors.
It is also a smart time to review your insurance.
For builders, insurance is not something to “set and forget”. Your risks can change quickly from one financial year to the next, especially if your business has taken on larger projects, new types of work, more subcontractors, new vehicles, additional tools, or different contractual obligations.
An EOFY insurance review can help make sure your cover still reflects the way your construction business operates today.
Why EOFY is a good time to review builders insurance
Builders and tradespeople often review their finances at EOFY, but insurance can easily be left out of the conversation.
The problem is that outdated insurance can create serious gaps.
A policy that was suitable 12 months ago may no longer match your business if your turnover has increased, your project values have changed, your team has grown, or you are now working under different contract conditions.
For construction businesses, insurance should be aligned with your projects, contracts, business structure and risk exposure.
Working with a specialist construction insurance broker can help you identify whether your current insurance program is still suitable before the new financial year begins.
- Has your turnover changed?
Many builders insurance policies are based on business turnover.
If your turnover has increased during the financial year, your current policy may no longer accurately reflect the size of your business. This can create issues if you need to make a claim or renew your cover.
It is important to review whether your declared turnover is still accurate across your insurance policies, especially if you have taken on larger projects, won more work, or expanded into different construction sectors.
A broker can help review your policy details and check whether your insurance still matches the scale of your operations.
- Are your project values still accurate?
Contract works insurance is one of the most important covers for builders and construction businesses.
It can help protect building works, materials and project-related risks while construction is underway. But for the cover to work properly, the insured values and project details need to be accurate.
At EOFY, builders should review:
- The average value of current and upcoming projects
- The maximum value of any one project
- Whether project durations have changed
- Whether materials, labour or construction costs have increased
- Whether upcoming contracts have specific insurance requirements
If your project values have increased, or you are tendering for larger jobs, your contract works insurance may need to be reviewed before the next project starts.
- Have your contracts changed?
Construction contracts can include very specific insurance requirements.
A principal, head contractor, developer or government body may ask for certain levels of public liability insurance, contract works insurance, professional indemnity insurance, workers compensation, or other forms of cover.
Before signing a new contract, builders should check whether their existing insurance satisfies the contract requirements.
This is especially important if you are moving into commercial construction, civil projects, design and construct work, government tenders or larger residential developments.
A specialist construction insurance broker can help review your insurance schedule against the requirements in your contract before you commit.
- Are you exposed to design and construct risk?
Many builders assume professional indemnity insurance is only needed by architects, engineers or consultants.
However, builders can still have design-related exposure, particularly if they are involved in design coordination, design and construct contracts, consultant engagement, product substitution, value engineering or performance-based recommendations.
If your business has taken on more responsibility around design, specifications, project advice or consultant coordination during the year, this should be reviewed.
Professional indemnity design and construct insurance may be relevant where there is a risk of claims connected to professional advice, design errors, omissions or financial loss.
EOFY is a good time to ask whether your role on projects has changed and whether your insurance still reflects that exposure.
- Is your liability insurance still suitable?
Liability insurance for builders is another key area to review.
Public liability insurance can help protect your business if your work causes injury to another person or damage to someone else’s property. For builders, this can include site incidents, damage to neighbouring property, subcontractor-related issues, or claims arising from construction activities.
As your business grows, your liability exposure can change.
You may need to review your liability insurance if:
- You are working on larger or more complex projects
- You are using more subcontractors
- Your contracts require higher public liability limits
- You are working on commercial, civil or government projects
- You have expanded into new types of construction work
A $5 million or $10 million public liability limit may not be enough for every builder, especially where contracts require higher limits.
- Have you purchased new tools, plant or equipment?
Tools, machinery and mobile plant are essential to the way construction businesses operate.
If you have purchased new equipment during the financial year, it is important to check whether it has been added to your insurance schedule.
Builders and tradies should review cover for:
- Tools and equipment
- Mobile plant
- Excavators, loaders and machinery
- Hired-in plant
- Equipment stored on site
- Equipment in transit
- Equipment kept in vehicles, sheds or workshops
Plant and equipment insurance should reflect the replacement value of the assets your business relies on. If your equipment list is outdated, you may be underinsured.
- Have your vehicles changed?
Commercial vehicle insurance is another area that can become outdated quickly.
If you have added new utes, vans, trucks or work vehicles during the year, check whether they are correctly insured and listed under the right business use.
Builders should also review who is driving the vehicles, whether the vehicles carry tools or materials, and whether modifications or fit-outs need to be considered.
For construction businesses, vehicles are often part of day-to-day operations, so a gap in cover can create significant downtime.
- Has your team or subcontractor use changed?
If you have employed new staff, engaged more subcontractors or changed the way your team works, your insurance program may need to be reviewed.
The way your business uses subcontractors can affect your risk exposure and may also affect how your insurance responds in certain situations.
It is worth reviewing:
- Whether subcontractors carry their own insurance
- Whether you collect certificates of currency
- Whether contracts clearly define responsibilities
- Whether your policy reflects your current workforce structure
- Whether your liability exposure has increased
A broker can help you understand how your business structure may affect your insurance needs.
- Are you relying on old certificates of currency?
Certificates of currency are often requested by clients, head contractors, principals, developers and project managers.
EOFY is a good time to check whether your certificates are current and whether the policy limits still meet contract requirements.
Before submitting a certificate of currency for a new project, make sure it reflects the correct business name, insured entities, policy dates, cover type and limits.
Using outdated certificates can create problems during tendering, onboarding or contract approval.
- Are your premiums and policy records ready for tax time?
EOFY is also the time many builders prepare financial records for their accountant or bookkeeper.
Business insurance premiums may be tax deductible depending on the type of policy and how the expense relates to earning business income. You should always confirm your specific circumstances with your accountant or tax adviser.
From an insurance perspective, EOFY is a good time to organise your renewal documents, policy schedules, premium invoices and certificates of currency so they are easy to access when needed.
Common insurance gaps builders should look for at EOFY
When reviewing your insurance, look for gaps such as:
- Turnover that no longer reflects the size of the business
- Project values that have increased
- New tools, machinery or plant not listed
- Vehicles missing from the policy
- Contract requirements that exceed current policy limits
- No professional indemnity cover despite design exposure
- Outdated certificates of currency
- Inadequate liability limits for larger projects
- Changed subcontractor arrangements
- Policies that no longer match the type of construction work being completed
These issues are easier to address before a claim, contract dispute or project delay occurs.
Why work with a specialist construction insurance broker?
Construction insurance can be complex and project-specific.
A general insurance policy may not properly reflect the risks faced by builders, contractors and trade businesses. The right insurance structure depends on the type of work you do, the contracts you sign, the projects you take on, the assets you own and the claims you may be exposed to.
Be Covered Insurance Brokers works with builders, developers, contractors and construction businesses across Australia to structure insurance programs around projects, contracts and business risks.
Rather than treating insurance as a once-a-year renewal task, a specialist broker can help you review your cover as your business changes.
EOFY builders insurance review checklist
Before the new financial year, builders should review:
- Business turnover
- Project values
- Contract works insurance
- Public liability insurance
- Professional indemnity design and construct exposure
- Plant and equipment insurance
- Tools insurance
- Commercial vehicle insurance
- Management liability insurance
- Subcontractor arrangements
- Certificates of currency
- Upcoming tender or contract requirements
- Policy schedules and premium records
Frequently Asked Questions
When should builders review their insurance?
The end of financial year is one of the best times to review your insurance, as it naturally aligns with reviewing turnover, project values, contracts and business costs. Any significant change to your business, such as new projects, new vehicles, new staff or new contracts, is also a good reason to review your cover.
What insurance should builders check at EOFY?
Key areas to review include contract works insurance, public liability insurance, professional indemnity insurance, plant and equipment insurance, tools insurance, commercial vehicle insurance, management liability insurance and certificates of currency. The right mix depends on the type of work your business does and the contracts you are working under.
Can I claim business insurance premiums as a tax deduction?
Business insurance premiums may be tax deductible depending on the type of policy and how it relates to earning business income. You should always confirm your specific circumstances with your accountant or tax adviser. This is general information only and not tax advice.
What is a certificate of currency and when do I need one?
A certificate of currency is a document from your insurer confirming your policy is current and active. Builders are commonly asked to provide one when tendering, onboarding with a head contractor, or starting a new project. It is worth checking at EOFY that your certificates are up to date and reflect the correct limits, policy dates and business details.
Need help reviewing your builders insurance before the new financial year?
If your construction business has grown, changed or taken on different types of projects this year, now is the time to review your insurance.
Be Covered Insurance Brokers can help you check whether your current insurance program still aligns with your projects, contracts, business assets and risk exposure.
Speak with Be Covered Insurance Brokers to organise an EOFY insurance review before the new financial year begins.
