Handyman insurance: what you need for small jobs

The usual starting point is two policies: general liability, for damage and injuries you cause in clients’ homes, and tools and equipment coverage for the drills, saws and ladders that live in the van. Workers’ comp comes in once you pay someone to help, the van itself needs commercial auto, which is separate insurance Corgi doesn’t sell, and the jobs you’re allowed to take on without a contractor’s license may be capped by your state, which affects how you describe your work when you buy coverage.

The risk that surprises people, though, is the size of the claim, which often has nothing to do with the size of the job. A two-hour task can flood a kitchen. For the wider set of policies trades carry, see insurance for contractors.

Small jobs, big claims

A handyman’s invoice reflects an hour or two of labor, but the claim reflects whatever the work touched, and in a house that’s water lines, gas lines, wiring, tile, hardwood and the belongings of the people who live there. Replacing a toilet supply line, swapping a light fixture, hanging a heavy mirror, re-caulking a tub, or assembling a crib that a toddler later climbs: each is a small job, and each can produce a claim far larger than the job ever was.

What general liability will and won’t pay for in a client’s home

You need to understand two exclusions before you rely on any general liability policy for this work, because handyman work runs straight into both of them, often on the same job.

General liability typically covers bodily injury and property damage your business causes to other people, including damage your finished work causes later through its products-completed operationsProducts-completed operationsProducts-completed operations is the part of general liability that covers injuries or damage caused by your finished work, or products you sold, after the job is done.Read the definition coverage, subject to the policy’s terms, limits and exclusionsExclusionAn exclusion is a provision in an insurance policy that removes coverage for specific causes, types of loss, property or activities the policy would otherwise cover.Read the definition. That’s the part everyone knows. The first exclusion is the one that catches handymen: many policies exclude damage to the particular part of real property you’re working on at the time, when the damage comes from your work on it. The second is the cost of repairing or redoing your own faulty work, which is usually excluded.

Now walk those through a real-looking job. Say you’re refinishing a client’s hardwood floor and the stain goes on blotchy, so the floor has to be sanded and redone, which is both damage to the very thing you were working on and the cost of fixing your own work, and that means the policy is unlikely to pay for the floor itself. But say that while you’re sanding, you knock over a lamp and it shatters a glass table across the room. That table wasn’t the part you were working on, so the policy may well respond for it. Same job, same afternoon, two very different answers.

Water is where this gets expensive, though. If the supply line you installed lets go after you leave and floods the cabinet, the subfloor and the room below, general liability may help with the damage to the rest of the house, while the line itself, and your labor to replace it, typically stays your cost. Insurers read these clauses closely, and the exact wording varies from policy to policy, so it’s worth asking an underwriter how your policy treats damage to the property you’re working on before you need to know. That one conversation will tell you more about your real coverage than the declarations page does.

Where your license ends

States draw the line between handyman work and contracting in very different places, and some don’t draw it at the state level at all, leaving it to cities or counties. California, however, gives a clear example of how specific the line can get.

The Contractors State License Board raised California’s minor work exemption from $500 to $1,000 starting January 1, 2025, under Assembly Bill 2622, but with conditions. The job can’t require a building permit of any kind, and the unlicensed person can’t employ anyone to help with it; the CSLB also says unlicensed work is illegal when a project is valued at $1,000 or more in combined labor and material costs, and that unlicensed people can advertise minor work only if the ad says they aren’t licensed. Put simply, in California a handyman without a license is limited to small, permit-free jobs done alone.

Your state may set a different dollar figure, list specific trades that always need a license, or have no state-level threshold, so check with your state and local licensing offices, since the SBA’s licensing guide notes that what you need depends on both your activity and your location.

Why does this belong in an insurance article? Because when you apply for coverage, you describe the work you do, and the policy is priced and written around that description. Handyman policies are also often written with limits on the work itself, such as no roofing, nothing above a set height or only minor electrical and plumbing, so list the jobs you actually do and read the classification you’re given. If you take on jobs your state says require a license, or work well beyond what you told the insurer, you may face questions about coverage at exactly the moment you file a claim. What “licensed, bonded and insured” actually means explains how licenses, bonds and insurance differ.

The van, the tools and the helper

These are three separate questions, and three different policies answer them.

The tools come first. A commercial property policy usually covers things at your business address, and a handyman’s business address is often a garage at home, while the tools spend their days in the van and on clients’ floors. Tools and equipment insurance follows them and can cover theft and damage on job sites, in transit and in storage, subject to its terms, though policies often require signs of forced entry for theft from a locked vehicle. What is inland marine insurance? explains how coverage for movable property works.

The van is next, and it isn’t something Corgi covers. Even so, if you drive your own vehicle to jobs, check whether your personal auto policy covers business use, because personal policies often limit or exclude it; a van used mostly for work usually belongs on a commercial auto policy instead.

Then the helper, the one that changes the most, because the day you pay someone to carry the other end of a cabinet, you likely have an employee, and most states require workers’ comp at some point once you have employees, though the thresholds vary, so check yours through the U.S. Department of Labor’s list of state workers’ compensation agencies. And remember the California rule above: hiring even one helper can take you out of the minor work exemption altogether, which shows how the licensing and insurance questions can arrive together.

When a client asks for a certificate

A homeowner hiring someone to fix a sticking door probably won’t ask for proof of insurance, unless the job is bigger than it sounds. But some will, and so will the people who control access to buildings.

Property managers, condo boards and building management companies often require a certificate of insuranceCertificate of insuranceA certificate of insurance (COI) is a one-page summary that proves your business has insurance, listing your policies, limits, insurers and policy dates.Read the definition before a vendor works in a unit, sometimes naming the building’s owner or association as an additional insuredAdditional insuredAn additional insured is a person or company, such as a landlord or client, added to your liability policy so it can protect them from claims tied to your work.Read the definition, and a homeowner comparing quotes on a bigger job may ask for one too. With Corgi, a certificate is available the day you buy, and you can download it or send it to a client from your account, so a request in the morning doesn’t hold up a job in the afternoon.