According to statistics, the handyman industry has been experiencing a steady growth over the last few years. That is good news for aspiring handymen looking to get into the market. 

Getting your small business up and running should be relatively straightforward in this favorable period. So, you are poised for success if you are reliable, have a head for running a business, and have skill at what you do.

However, deciding to start is just the first step to starting your own handyman business. You will need to take some official steps. These will differ from city to city and state to state, so it’s best to check your local laws regarding starting a new small business and becoming a contractor. 

Nevertheless, here are the basic things you need to do:

Create a business plan

It will help you decide what you want to achieve with your business. It will help motivate you to run and grow your company to its fullest potential by setting your long-term and short-term goals.

Your handyman business plan should include your projected income from every six months to a year. It should also include your expected costs, the services you will offer, the business structure, and other related details. You can easily find fillable templates online if you aren’t sure where to begin.

Determine an hourly rate

Choosing prices per project can result in you overpricing or under-pricing your services, depending on how long any given job takes you. Do some research to ensure you’re not losing money by setting the wrong hourly rate.

Depending on the type of job, the average rate per hour of handyman services falls between $65-$125. However, make sure to check average prices in your area so that you can offer competitive pricing in your local market. At the same time, be careful of under-charging. You are trying to build a profitable handyman business, so if you charge too low, you may get many jobs, but you’ll find it challenging to achieve your financial goals. You may even lose money, depending on your overhead costs.

Get a business license

Even though you are a contractor, no license or permit is required for handymen in most states. However, if the job exceeds a particular monetary value or is part of a larger project, a contractor’s license may be required. Above all, if you want to stay in business, you should always take local regulations into account.

If your state requires you to have a Handyman License, you will most likely also be required to have liability insurance. Many apartments, condos, banks, or government institutions require proof of insurance. Of course, this makes sense. They must protect themselves from financial loss if something goes wrong due to your work. On the other hand, so should you.

You must be prepared to protect yourself and your handyman business from liability claims.

Get Insurance

Before you take your first client, there is one crucial thing you need to do. That is, purchase handyman insurance.

Getting insured is critical for any small business owner, but this is especially important for handyman businesses. If you start taking on jobs without coverage, you could open yourself up to disaster. Repair and maintenance jobs can come with a high level of liability. Ignore this, and you could find yourself in some deep water. 

For instance, say you are fixing an old plug. Unfortunately, the previous electrician made an error in the circuit wiring, and your work triggered an electrical fire. Unless you have the funds stashed away to rebuild the client’s house completely, you might be in severe financial trouble if they lay a claim on you.

Another top reason to get handyman liability insurance is to instill confidence in your customers. No homeowner wants to risk paying for property damage they didn’t cause. Instead, they want to know that should there be any problems, your insurance will take care of them immediately.

If you hold general liability insurance, this puts potential customers at ease and lets them know that you operate on a professional level. 

What’s more, it also helps you stand out from the crowd. Although most states require liability coverage, nearly 44% of small businesses don’t have insurance.

If you do things by the book and take out insurance, your handyman business will stand out as law-abiding and considerate of its customers.

Besides instilling customer confidence, handyman insurance may also expand your target customer base. That is because many apartment complexes and bank-owned properties usually require proof of small business insurance from potential contractors.

What policies do you need?

General liability insurance will cover many things, including bodily injury, property damage, personal injury, and advertising damages. For example, it will cover you if you accidentally damage a customer’s home or suffer an injury at work.

However, you may have vehicles to transport yourself and your employees. Don’t make the mistake of thinking your personal insurance gives coverage for this. You will need to invest in commercial auto insurance.

Auto accidents can prove to be expensive. Not only is your vehicle damaged, but it can also upset your schedule and cause delays. These delays are covered by business interruption insurance. Be aware that this is not typically covered by General Liability insurance.

Tools and equipment are one of the biggest investments that handymen have to make. Replacement is sometimes untimely and costly. Depending on your coverage package, you might find that your tools are covered against breakages, theft, and failure.

Injuries and accidents are common in a successful handyman business, and Worker’s Compensation Insurance will help protect you in the case of lost wages from such mishaps. They will help ensure small business owners that their company will continue to run in case of a disgruntled customer lawsuit or if you find yourself suffering from a work-related injury.

As previously stated, most states require you to be insured before starting a handyman business, as it’s considered part of a contractor’s requirements, so getting insured is crucial to ensuring your new business is thriving.

How do I get contractor business insurance?

Before you hurry to take out general handyman liability insurance—you should also ensure that you find the best deal. Please note that by the best deal, we don’t mean the cheapest. Instead, a liability insurance package that gives you the most coverage for the lowest premiums.

Farmer Brown routinely saves small businesses money on their insurance premiums. Moreover, our liability coverage solutions are fast and low-cost, meaning you can be covered and ready to operate within a minimum amount of time.

If you need the best liability coverage for the best price, fill out our application form for a free quote today.

Have any questions? You can contact or call us anytime on (888) 973-0016.

Written by: John Brown
John has more than 25 years of experience in the insurance industry. He grew from a star insurance producer to owning one of the largest agencies in the country; he's a reference regarding contractor's insurance, commercial insurance, and builders' risk insurance.