A Guide to Contractors Insurance
Byadmin
Working as a contractor comes with its fair share of risks – especially if you’re in the construction industry. There’s a lot of room for error, and if you aren’t prepared, a single accident can cost you thousands of dollars. We have put together an exhaustive article regarding a guide to contractors insurance.
Fortunately, in the modern-day world, insurance can act as a backup plan by cushioning your financial burden in case of an unforeseen event.
So as a contractor, what type of insurance do you need to apply for? This comprehensive guide will walk you through everything you need to know.
Table of Contents
What Kind of Insurance Does a Contractor Need?
Contractors are recommended to apply for contractors’ liability insurance. It is an umbrella term that covers several different policies. It protects contractors from financial liabilities for work-related accidents. This is why due to the immeasurable number of risks involved, construction businesses apply for contractors’ insurance more frequently, as opposed to any other business.Why do you Need Contractors Insurance?
Aside from contractors insurance being mandatory in some states, at any given moment, a small accident can lead to everlasting consequences and even potentially put you out of business. While you can’t control what happens in your surroundings, you can control how you prepare for it. Securing a contractors liability insurance protects you from financial liabilities in case your business is hit by a lawsuit. Similarly, it also shoulders the costs for accidents and injury claims by the affected parties. Additionally, contractors insurance exhibits your sincerity towards employee and client safety. So this coverage can act as a stepping stone for the success of your business by helping you bag larger commercial contracts. The majority of the professional contractors out there have contractors insurance. Not only can it make you look more credible, but it can also do wonders for your reputation. Ready to get started? Our insurance agent can walk you through the process of applying for contractors insurance at extremely market competitive rates.How to Know You Need Contractors Insurance?
Whether you’re an independent contractor or run a full-fledged business with hundreds of employees – here are some questions to ask yourself to determine if you need contractors insurance:-
You have Plans for Business Expansion
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You Have Valuable Assets to Protect
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You Hire Employees
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You Work as a Subcontractor
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You Regularly Use Automobiles for Work-Related Purposes
Is General Liability Different from Contractors Insurance?
You may have seen general liability and contractors insurance being used interchangeably, so are they the same? Pretty much. Contractors often wonder what type of insurance they should purchase, so the term contractors insurance is just an umbrella term that they could refer to. A contractor’s insurance policy always includes general liability. But is general liability insurance for contractors enough to smoothly run your business? Usually it isn’t because of the uncertainty involved in running a construction business. This is why always check in with your insurance provider what other coverage your contractor insurance offers and evaluate if it meets your business requirements.What does a Contractor’s Insurance Cover?
As we mentioned earlier, contractors insurance comprises multiple policies. The following coverages are the most common among them:-
General Liability Insurance
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Builders Risk Insurance
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Workers Compensation
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Roofers Insurance
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Automobile Insurance
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Contractors Pollution Insurance
Does an Independent Contractor Need Insurance?
Regardless of the size of your business, having contractors insurance is essential because of the following reasons:-
Keeps You and Your Business Protected
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Most Clients Require It
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Required by Law in Some States
What are the Insurance Requirements for Contractors?
There are two common ways for contractors to get insurance:-
Apply for your Insurance Policy
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Let your Client Add you to Their Policy
Why is Buying Contractors Insurance Better than Individual Policies?
People often wonder if is it even necessary to buy contractors insurance? Can’t you simply go for individual policies instead? Well, you can, but we do not recommend it. Here are some reasons why contractors insurance is better than individual policies:-
Meets your Particular Needs
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Lighter on the Pocket
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Deal with Only One Carrier
What Industries Normally Apply for Contractors Insurance?
Contractors insurance isn’t only useful for construction businesses. As it covers a wide variety of policies, the following industries can also significantly benefit from it:- Carpenters
- Appliance Repair
- Flooring and Renovations
- Electricians
- Landscapers
- Plumbers
- General Contractors
- Heating and Cooling Contracts
- Stucco Contractors
- Framing Contractors
- Concrete Construction
- Asphalt Contractor
- Excavation Contractors
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