Contractors have special considerations when it comes to insurance. The best insurance policies for your contracting business will depend on precisely what you do. For example, a roofing contractor needs different coverage than a lawn care contractor. Still, some primary insurance considerations apply to most contractors. Here is a pocket guide to insurance for contractors.
Do I Need Contractors Insurance?
As an independent contractor, you need insurance to protect your property from damage and your business from liabilities. There are many types of contractors who have exposure and need protection. They include:
- Construction contractors such as excavators, roofers, and masonry contractors
- Trade contractors including plumbers, electricians, and licensed carpenters
- Handyman businesses or those in the repair trade
- Housekeepers or house cleaners
- Lawn maintenance companies
General Liability for Contractors
General liability coverage is the foundational insurance policy for contractors. It is often required by customers before you begin, or even bid on a job. General liability insurance includes:
- Bodily Injury liability coverage to protect you if you’re responsible for someone’s injuries.
- Property damage liability protects you if you are responsible for damaging someone’s property.
- Products and completed operations insurance offers coverage if one of the jobs you completed is found to have caused damage or injury.
- Personal and advertising Injury protects you from claims of slander or libel.
These are the most basic insurance considerations for all contracting operations. Talk to an insurance professional about your services to make sure you have comprehensive coverage.
Coverage for Your Property
Most contractors – especially in the construction industry – need good insurance for their tools and equipment. A commercial inland marine policy and property policy includes:
- Coverage for your physical property such as tools and other equipment. Such coverage applies to the property you own or rent.
- Protection for buildings you rent or own such as warehouses, offices or other structures.
- Business Income Coverage works to replace your income if your business is unable to operate due to a covered loss.
Workers Compensation Coverage for Contractors
Workers Compensation coverage protects your employees if they are injured on the job. It also extends to job-related illness and death. It provides for your employees’ medical expenses and lost wages. Most states require contractors carry workers compensation coverage.
Vehicle Insurance for Contractors
If you use work vehicles such as trucks or vans, you need a commercial vehicle policy. A commercial auto policy works like your personal auto policy except it is for use with business autos. Keep in mind your own auto policy doesn’t cover business use.
A commercial auto policy offers liability coverage if you are responsible for injuring someone or damaging their property using your business vehicle.
It also provides physical damage to your contracting vehicles if they are damaged by an accident or some other event such as a flood or hailstorm.
Find a Knowledgeable Insurance Professional
Contractors should work with a knowledgeable independent insurance professional. Each contracting business has its risks and exposures. For more information on roofing insurance in Los Angeles click here. Make sure your business is prepared and protected by working with a licensed insurance agent.