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  • #996320
    bluesky1234
    Member
    • Total posts: 1
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    Hi,

    I have recently started a small cleaning company in which I will be (at this stage) solely using subcontractors to complete the work.

    I make sure they have public liability insurance, but I’m not exactly sure about my liability if something does go wrong (on a job that they have done, which I passed to them) that requires insurance.

    I recently bought PLI from NRMA for 10Mil for my company, but that doesn’t cover subcontractors. Is this normal? Am I covered should something go wrong on a job that my subcontractors carried out on my behalf if they have PLI for their business, and I have it for mine?

    Is there anything I need to be aware of around this issue? I feel like it’s fairly straightforward situation, I’m just not sure if I will be covered or not should something go wrong. Or do I need to get a different cover which includes subcontractors (if it exists)?

    Does the PLI for my company mean nothing if my subcontractors are not covered under my policy?

    If anyone can shed any light on how this normally works and answer my questions, I’d be grateful. It’s hard to find definitive information on what seems like a fairly standard agreement.

    Many thanks, Flyingsolo-ers!

    #1206784
    Paul – FS Concierge
    Keymaster
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    You are on the right track – you and your subbies need coverage in case of a claimable event.

    Your set up is the most common way to be covered. It is very hard and expensive to get your subbies covered under your policy. Some years I have had that kind of policy, then seemingly for no reason (I know of), they have not been prepared to cover me for the next year.

    #1206785
    Delphic
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    I would suggest speaking to a broker to get specific advice, that’s why we exist. A good broker should review your terms with your contractors and give you advice for risk mitigation strategies and correct levels of insurance.

    In very broad terms, you will still have a vicarious liability for the work that they undertake irrespective of only them doing the work and them having their own insurance in place. Different policies have different language around the coverage they provide, direct policies through companies such as NRMA being some of the worst as they can get away with complex wordings as they don’t have the advisor community telling them off.

    #1206786
    elissa.doxey
    Member
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    Hi Bluesky,

    It might also be prudent to get legal advice – a number of cleaning companies have fronted Fair Work in recent years because their contractors have been treated as employees, but paid as contractors.

    In terms of insurance, you really should take Peter’s advice and see a broker to make sure the policy covers you and your business properly.

    All the best,
    Elissa

    #1206787
    joepatel
    Member
    • Total posts: 2
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    Although insurance seems cunning in a manner, but it is important for business.

    #1206788
    NickKaro
    Member
    • Total posts: 226
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    Agree with most of the above. Other than insurance you really need to get some legal advice as most new businesses in this space do not understand the difference between a sub-contractor and an employee and their agreements/way they operate get them into trouble down the track (either from a legal, Fair Work or PAYG/payroll tax perspective).

    Happy to assist if you decide to seek professional advice.

    Regards
    Nick

    #1206789
    hairextension
    Participant
    • Total posts: 20
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    Hi I’m just inquiring did u get advice from a broker I’m in the same situation any help would be great thanks

    #1206790
    alliedib
    Member
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    hairextension, post: 254229, member: 37403 wrote:
    Hi I’m just inquiring did u get advice from a broker I’m in the same situation any help would be great thanks
    A number of brokers (myself included) provide general advice on this forum. The issue you will have is that the OP’s circumstances may be different to yours, therefore any advice they received may not be relevant.
    I would suggest sourcing your own insurance broker to discuss as that’s the only way to get advice specific to you.

    Regards,

    Mark

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