What insurance does a handyman need?

Part of: Handyman Business

Start with general liability insurance, which the SBA says protects any business against losses from bodily injury, property damage, medical expenses and lawsuits. Then cover your tools and truck, because the NAIC says homeowners policies usually limit business property to $2,500 in the home and $250 away from it, and personal auto policies may exclude business use. Add workers' comp once you hire, and a bond if your state license requires one.

This guide is part of our Handyman Business Growth hub. It explains the common types of coverage. It is not advice on any policy, so talk to a licensed agent before you buy.

What types of insurance does a handyman need?

The SBA and the NAIC, the national group of state insurance regulators, describe these common types. Here is how each fits handyman work:

Sources: SBA, NAIC.

What does general liability cover, and what doesn't it?

The NAIC says commercial general liability covers bodily injury, damage to others' property, personal injury such as slander and libel, and false advertising. It does not cover employee injuries, which belong to workers' comp, and it does not cover claims from operating a vehicle.

It also does not pay to redo poor work. Oregon's Construction Contractors Board says this plainly: general liability does not pay for poor work. That is one reason some states pair insurance with a bond.

Are my tools covered?

Probably not by your home policy. The NAIC says most homeowners and renters policies limit coverage for business property to $2,500 in the home and $250 away from home. For a handyman whose tools ride in a truck all day, the "away from home" limit is the one that matters. The SBA says a home-based business can sometimes add a rider to a homeowners policy, and the NAIC suggests a business owner's policy or business property insurance to close the gap.

Does my personal auto policy cover work driving?

Check it before you rely on it. The NAIC says that if you use personal auto insurance for a vehicle used in business, look closely at the policy, because business-related liability may be excluded. It also says that even if you use your own car for business errands, you may need commercial vehicle insurance, and you may want higher liability limits.

When does a handyman need workers' comp?

Once you hire, and the rules depend on your state:

1. California: the Department of Industrial Relations says all employers must provide workers' comp, even with one employee.
2. Texas: the Department of Insurance says most private employers can choose whether to carry it.
3. Elsewhere: the NAIC says most states require it even with one employee, and suggests checking with your state insurance department.

If you hold a California contractor license, the CSLB also requires a workers' comp certificate on file, or an exemption if you have no employees.

Does a handyman need to be bonded?

Only if your state or license calls for it. A bond is not the same as insurance. In California, for example, it is there for customers and unpaid workers, not for you. Two examples:

1. California: the CSLB requires a $25,000 contractor's bond before it issues, reactivates or renews a license. Consumers harmed by defective work or license law violations, and unpaid employees, can claim against it. Jobs under the $1,000 handyman limit do not need a license, as our handyman license guide explains.
2. Oregon: ORS 701 sets both a bond and an insurance minimum for each license type.

The CCB's endorsement chart says the residential limited license suits part-time and handyman work, with gross yearly work under $40,000 and no single job over $5,000.

How do I buy coverage?

The SBA's buying steps start with these three, and the fourth is our own tip:

1. Assess your risks. List what could go wrong: ladders, power tools, other people's homes and driving.
2. Find a licensed agent. Pick one who asks about the work you actually do.
3. Shop around. Compare rates, terms and benefits from more than one agent.
4. Get it in writing. Ask for a certificate of insurance you can show customers.

Then build the cost into your rates. Our guide on how much to charge for handyman work shows how to build costs like insurance into your rate, and our handyman website guide shows where to say you are insured.

How Momyntum helps

Once you are covered, let customers know. Get your free website check to see what your site says today, or start a 14-day trial of Momyntum for help with your website, Google and AI search, and outreach.

By Momyntum Team. Updated November 1, 2026. For: Handyman.

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