Working as a contractor can be a rewarding experience. It gives you a chance to build connections, earn steady revenue, and even change people’s lives. Before getting started, though, it is important to make sure you comply with the law.
Contractor’s insurance is a legal requirement in most states and industries. Without it, you may not be able to start and run your business. This type of coverage can save you big money in case something ever goes wrong, so it does not hurt to have it.
Certain industries, such as construction, pose a high risk of injury. The average construction worker has a one-in-200 chance of dying on the job throughout a 45-year career. Falls are a leading cause of fatal injuries.
Considering these risks, it makes sense to get adequate coverage. That is where contractor’s insurance comes in. Here is what you should know about it.
How Does Contractor’s Insurance Work?
This type of insurance covers personal injuries, property damage, errors and omissions, and other risks associated with a contractor’s work. It applies to all industries, not just construction.
Financial planners and accountants, for instance, can make costly mistakes that could cause their clients millions.
If your insurance policy covers errors and omissions, you protect against claims made by customers for negligent actions. The insurer will pay for part or all costs rendered by the court of law.
What if one of your workers becomes disabled and loses his ability to work? In this case, the insurer will cover his costs.
How much coverage you will get depends on the type of contractor’s insurance you choose. Your options include but are not limited to:
- Commercial General Liability (CGL)
- Professional liability coverage
- Contract liability coverage
- Builder’s risk coverage
- Contractors’ all risks (CAR) insurance
- Advertising injury coverage
- Umbrella policies
- Errors and omissions insurance
General liability insurance is the most common choice. It includes bodily injury and property damage coverage.
Assess Your Needs
Now that you know your options, then you can determine how much coverage you need. Consider your industry and the risks involved.
For example, if you handle electrical and mechanical equipment, you may want to purchase equipment breakdown insurance. This type of plan will cover the cost to replace or repair computers, boilers, cutting machines, and other devices.
Make sure you understand the limitations of your policy. Read the fine print and discuss your options with a lawyer or an insurance agent.
Always protect yourself from the most common claim scenario, whether it is theft, bodily injury, or fire.
Not all insurance policies are created equal. Their price varies among providers and may be different for every business and industry.
Get at least three quotes from different insurance companies. Compare them side-by-side, check the exclusions, and ask about extra perks.
If you are an independent contractor, you may be able to get cheaper coverage from your trade organization. Since they purchase insurance policies in bulk, they might be able to offer discounted rates.
Protect Your Business with the Right Coverage
Whether you are working on your own or with a team, do not take unnecessary risks. Accidents happen when you least expect it. You could fall and get injured, your equipment may catch fire, or a client may take you to court.
Contractors’ insurance can be a lifesaver. It is one of the best investments you will ever make. Research your options and compare quotes to find a policy that meets your needs.
For free contractor’s insurance quotes, visit our website. Fill out a brief form, and we will get back to you!
Top Contractors Insurance Services is a full-service contractor insurance agency handling workers compensation, general liability, construction bonds, and auto quotes.