Working as a contractor is the ultimate opportunity to be creative, work with your hands, and create jobs in the community. However, you need the proper commercial insurance for contractors. Use these tips to find the best policy, make wise choices, and protect such an important investment.
Why Is It Important for Contractors to Have Insurance?
Contractors need insurance for several reasons:
- You are purchasing, using, and storing materials and equipment
- Your business needs to generate revenue
- Workers’ compensation is mandated under state law
- You may require pollution insurance
- Your business likely owns and uses vehicles
- You may require coverage for your specific type of business
Your business is a multi-faceted operation that you can’t manage 24/7. You have too much to do, and you simply can’t prevent all accidents or incidents.
Without proper insurance coverage, your business could be financially-crippled or bankrupted by a successful claim.
What Types of Coverage Should Contractors Consider?
As a contractor, you must understand that there are several forms of insurance to consider. You don’t buy one policy and sit back, pleased with your level of coverage. Speak to an agent about all these coverage options:
General commercial liability insurance protects your contracting business against claims for:
- Property damage
In addition to these payments, your general liability policy offers legal assistance and pays legal fees along with any judgments or settlements you might incur.
Workers’ compensation is required under Ohio law. Carry a quality workers’ comp policy that is both affordable and provides your employees with value. If they are injured on the job, this policy handles:
- Medical costs
- Lost income
Liability coverage for your work vehicles is doubly-important because they can cause injury or incur losses, but they can also lose or damage property. You might be transporting tens of thousands of dollars of equipment or materials, and protecting those items in transit is vital to the success of your business.
Contractor pollution insurance is a unique policy designed for businesses like yours in the event that you are sued by a third party due to pollution damage. On the one hand, you need protection if a claimant says you caused their injuries or illnesses. On the other hand, you may be sued for violating local or federal environmental protection laws.
Builders risk insurance can either be purchased separately from your general liability policy, or it is included with your liability coverage. These policies generally cover lost, stolen, or damaged:
When you work in a field like roofing, you might prefer industry-specific coverage that protects you given the unique liabilities your business confronts.
For example, roofers are far more likely to experience accidents due to the risk of falling, and you can work with an agent to build a policy that covers your business a little bit more than general liability insurance.
Did you know that insurance prices are consistently rising? Base pricing of commercial insurance has risen 25% since the beginning of 2018, and some carriers are boosting premiums 50% to 100%. As you review these coverage options with your agent, ask for any discounts that might apply.
Can an Independent Contractor be Held Liable for Damages?
Yes. When you’re invited to a job site as an independent contractor (for example, you’re laying tile,) you can be held liable for any damage that you cause. Additionally, you require protection for your small business.
Never assume that the general contractor’s insurance covers you. Their insurance covers their employees—and you are likely not listed as an employee.
Contact Us for Assistance With Commercial Insurance for Contractors
Get a quote for your contracting business. Let us help you save money by custom tailoring the right coverage. We can also review your current policy and help you make any necessary changes.