If you are a Contractor or Sole Trader operating in the Mining or Oil & Gas Industry, it is important that you have a cost-effective insurance program, that also provides you with the correct level of coverage to meet the requirements under most resource industry contracts.
An example of Resource Sole Traders may include:
– Mining Engineers – Oil & Gas Consultants
– Geologists – Metallurgist
– Drilling Contractors – Environmental Consultants
Public & Products Liability
Policy Coverage: Most mining or oil & gas contracts require a liability limit of $20,000,000, with extensions such as; Principals Indemnity, Cross Liabilities and Pollution Liability.
Policy Pricing: We generally see premium levels for sole traders starting from:
- White Collar: Non-manual work – onshore & offshore, ranging from $750 – $1,000 plus GST & SD.
- Blue Collar: Manual work – onshore & offshore, ranging from $1,125 – $1,500 plus GST & SD.
Workers Compensation
As a sole trader, you are unable to cover yourself as an employee under Workers Compensation Insurance. We therefore recommend Sole Traders to obtain a Personal Accident & Illness Policy, which can provide a weekly benefit if you are injured at work. Coverage is usually limited to a 2 year period.
Given that sole traders do not have entitlements such as sick leave, we recommend also considering a broader level of cover in the form of Income Protection Insurance. This will provide greater financial support than Personal Accident Insurance, and can also provide cover for events such as Stress or Trauma.
If your company operates under a Pty Ltd structure, you are able to obtain Workers Compensation Insurance as a nominated Working Director. This policy could also be endorsed to include the required contractual extensions, such and Principals Indemnity and Waiver of Subrogation.
If you are unable to obtain Workers Compensation Insurance, we recommend negotiating any contracts to either refer to Personal Accident or Income Protection Insurance. Alternatively, the Principal could potentially agree to include your sole trader wages under their Workers Compensation program.
Other types of Insurance we recommend
Management Liability Insurance – there are a number of exposures that Sole Traders and Contractors are potentially liable for. A Management Liability Policy may provide coverage (including defence costs) for the following:
- Cover for Directors or Entity – allegations of misleading and deceptive conduct in a contract negotiation
- Employment Practices – include issues such as bullying, harassment or allegations of wrongful termination
- Statutory Liability – Breaches with respect to Work Health & Safety (WHS) or other Statutory Regulations
- Crime – Theft of Funds or Stock by Employees
- Tax Audit Expenses
Legal Expenses Insurance – providing cover for the cost of defending or pursuing statutory or civil actions. Example of this could be contractual disputes with a Client or past employee, or statutory matters such as a WHS breach.
Professional Indemnity Insurance – if you provide professional advice, you will also need to consider Professional Indemnity Insurance. The policy is designed to provide protection from a third party claiming financial loss, due to your professional negligence, errors or omissions.
How can I obtain an Insurance Quote?
At Trident, we understand that not all resource industry sole traders are the same, which is why we must analyse each individual risk profile.
The benefit of doing this exercise is the following:
- Allows each client to have a greater understanding of their inherent risk
- Helps to differentiate each clients risk profile from their industry competitors
- Provides the insurance market with greater confidence in the company, by having a strong understanding of the level of risk.
We recommending calling or emailing our Resource Industry Specialist, to discuss your specific insurance requirements.
Dan McCallum
danm@tridentinsurance.com.au
0423 449 607