As contractors, it’s important to understand what types of insurance your business should have and why. You work hard – make sure you’re properly covered for unforeseen circumstances that could harm your business. Check out this list of recommended insurance policies:
- Workers’ compensation—Workers’ compensation covers work-related employee injuries or illnesses. While injuries are infrequent, they can be severe and require extensive medical treatment, resulting in a loss of ability to work. Workers’ compensation is critical coverage, as it takes care of the injured employee in the event of an accident. It will pay medical bills associated with work-related injuries and compensate the employee for lost wages—which can occur if the injury is severe enough for a doctor to recommend taking time off. What’s more, workers’ compensation policies typically come with employer’s liability coverage, which covers employers if a lawsuit is brought against them for their negligence in a workplace injury.
- General liability—General liability insurance covers claims of injury or property damage caused by routine operations. Artisan contractors face exposure if they work in occupied buildings or customers come into their office or showroom. General liability insurance can also cover damage to a customer’s building caused by a contractor. Additionally, it can provide coverage for reputational harm or advertising injury.
- Completed operations—Completed operations claims occur when injury or property damage results from finished work. This coverage protects businesses that provide a service and does not apply until after the work is done.
- Commercial auto—Artisan contractors may use trucks or vans to transport employees, materials and equipment to a worksite. Commercial auto insurance can cover damage to company vehicles, damage to others’ vehicles and medical payments. Physical damage covers the damage to company vehicles, and liability covers damage done to other vehicles. Hired and non-owned coverage takes care of rental vehicles and employee-owned vehicles used for business reasons.
- Property—Damage to a company’s physical assets, including buildings and the business property, may result in property claims. Even if artisan contractors work out of their homes or do not have their own building, business assets such as equipment, tools and computers are still at risk of property damage. Property insurance protects only from the perils outlined in the policy. For example, floods are generally not covered events. Additional coverage may be necessary.
- Inland marine or equipment floater—Since commercial property insurance only covers business property at the location listed on the policy, inland marine insurance may be necessary for property stolen or damaged during transit. Since contractors typically travel to job sites with tools and equipment, equipment floater policies can help protect them from risk.
- Commercial umbrella—Commercial umbrella insurance provides additional coverage if claims exceed their limits. For example, if the policy limit is $1 million, but the loss is $2 million, an umbrella policy can make up the difference. Otherwise, costs may have to be paid out of pocket.
- Cyber liability—Increasingly, contractors depend on technology to carry out their operations. Complex projects often require information and financial exchanges between clients, contractors, suppliers and other third parties. While technology helps contractors perform their work, they are at risk of suffering financial losses from cyber events. Cyber liability insurance can help artisan contractors by providing coverage for first- and third-party cyber claims.
To explore all of these policy options, contact Consolidated Insurance + Risk Management today!