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Self-employment in civil engineering is a booming trend

Self-Employed Civil Engineers Should Check Their Insurance & PI Covers

Feb 2020

Self-employment in civil engineering is a booming trend, with the rate at which civil engineers have been ‘going it alone’ since 2013, more than twice the rate of that witnessed across the whole economy.[1]

Between 2013 and 2018, the number of civil engineers opting to be their own boss rose by 33%.  In other sectors of the economy, the rate was just 12.1%.

One reason for this situation relates to the women civil engineers in the sector, who typically find self-employment an attractive proposition, according to payroll and accountancy firm, Access Financial, which specialises in providing services to the sector.

The figures show that whilst just 1.6% of self-employed civil engineers were women back in 2013, females now comprise 4% of the self-employed civil engineer workforce.

Another reason for the boom in self-employment is the project-based work that makes up many civil engineering projects.  Those wishing to set up their own business are able to tap into a market in which there is a skills shortage, making the demand for self-employed contractors higher than might be the case for self-employed workers in other sectors.

Project work is also well-suited to the needs of a self-employed worker, who may wish to organise work around their own schedule, building in family or leisure time as suits.

With higher rates of pay typically allocated to ‘freelance’ contractors, there is also the capacity for these workers to not necessarily work on as many projects as they would do if employed.  The extra money earned can also see them over any periods in which jobs do not come in.

With 19% of the UK’s workforce employed by the engineering industry[2], in one form or another, this trend towards self-employment is one worth noting.  While other parts of the gig economy, such as logistics and deliveries and the taxi sector, make the headlines, the civil engineering situation is somewhat going under the radar.

One thing any self-employed civil engineer must consider, however, is insurance.  Public liability cover is considered a ‘must have’ and, if they bring in any other workers to assist them with projects, employers’ liability protection may be required, according to the terms of their agreement. 

Another insurance to discuss is Contractors All-Risks insurance, to protect against claims of poor workmanship, or damage or loss to building work, plus other areas such as theft of equipment or damage to hired-in plant. 

Professional indemnity (PI) insurance is also vital but becoming harder to buy after the Grenfell disaster, so self-employed civil engineers should talk to a broker who can assist with PI insurance well ahead of needing to buy it for the first time, or their policy renewal date, if they already have cover.  The rates on PI insurance, and some of the exclusions now being written into policies, may be more damaging and risk-laden for a self-employed contractor, potentially eating into the daily fees charged because of unexpectedly high premiums. They could also leave an individual too exposed to aspects such as high policy excesses.

If you are already a self-employed civil engineer or contractor, or wish to become one, discuss the insurances required and understand the likely costs involved for what is non-negotiable cover for this type of profession and which will be typically need to be in place, in order to pitch for project work.  If you need to know more about the insurance options available, and need to keep your costs under control, use our ‘Find a Local Broker’ tool, to source an insurance broker who can help guide you and give you as wide an access to alternative policies as possible.