Litigation has been increasing year after year in the United States. As more lawsuits become the norm, builders and contractors need better insurance policies.

You likely need to carry a variety of business insurance policies. One of the most important is contractor insurance, which includes general liability.

Once you have purchased your policy, you can set and forget, right?

It is a better idea to review your insurance coverage on a regular basis. You might even consider increasing it now and then.

Why Should You Review Your Insurance Policies?

You should review your contractor insurance policy because your needs are always changing. A good rule of thumb is to review your policies once a year.

Think about how life insurance needs can change in a year. If you get married or have a child, you will want to increase your coverage to provide for your family.

You should handle your business the same way. As the value of the business increases and you invest more in it, take steps to protect your investment.

When Should You Increase Contractor Insurance?

There are a few times when you should consider increasing your contractor insurance.

The first is when you do more work. If you have several properties that you are developing, then you may need extra builders insurance. As you complete more work for more clients, you have also increased your liabilities.

When you buy new equipment, you increase your sunk costs in the business. This reality is obvious when you have a large expense, such as a new company vehicle. It is not as clear for smaller purchases, such as new office equipment or new tools.

No matter what you buy, you want to protect your investment. Increasing your insurance can help you reach that goal.

Review Your Legal Compliance

Another reason you may need or want to increase your contractor insurance is if the law requires it. Legal requirements are always shifting, so more coverage may be necessary.

Changes to laws sometimes reduce coverage under specific types of insurance. It is a good idea to track your compliance. This way, you can be sure you are in line with the law.

Decreasing Insurance is Sometimes an Option

Sometimes, you may want to lower your coverage.

Imagine you sell a piece of property or stop renting it. Maybe you decide to reduce the number of company vehicles you own. In these cases, you may not need as much insurance.

The same is true if your business has declined or if you are winding down operations.

You could save yourself some money by scaling back your insurance. You can always increase it again later if you need to.

Who Should You Talk To?

It is a good idea to review your insurance policies at least once a year. After your review, you might want to make changes.

If you want to know if increasing contractor insurance is right for you, then talk to the experts. They can help you assess your business needs and get you the right insurance for your company.

Top Contractors Insurance Services is a full-service contractor insurance agency handling workers compensation, general liability, construction bonds, and auto quotes.