Insurance Required for General Contractors: Different Types

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For your contracting business, having appropriate insurance coverage helps protect you and your hard-earned money. This is a wise investment considering that this safeguards your valuable assets. It gives one peace of mind, knowing that in the event of any unforeseen circumstance, you can thrive, and your business is well-prepared.

The worst thing is that issues may arise no matter how mindful you are. If someone sues you, we recommend paying relevant attorney fees to defend your business. Still, it is vital to remember that if the court rules in your favor, you must handle the defense attorney’s expenses. 

It means you should find ways to protect your business and yourself as an employer. The main idea is to save money, differentiate your coverages from competitors, and increase the overall bottom line. Check out this site: www.contractorbond.org to learn more about different options. 

As soon as a specific incident or accident causes physical harm or any other damage to third parties or clients, you will need insurance coverage to handle legal expenses, health costs, and other things required.

Besides, if someone gets injured while on the job, you will also be liable for criminal prosecution or hefty fines unless you have relevant compensation insurance. Insurance is crucial in all US states, which is vital to remember. 

Even established corporations would lose their money by central claim; while you may win the case, the expenses will still affect your situation. Getting relevant liability coverage will help you transfer risks against your enterprise and towards the insurance company, while you will pay the monthly amount until the reason arises.

In any line of business, we are facing certain risks. Some are transparent, while others can happen suddenly and without prior understanding. These circumstances can help you shield a business against potential issues while operating. 

General contractors must meet relevant requirements when it comes to liability, including theft, property damage, worker’s compensation, and others. Still, it would be best to understand the options to ensure you manage the risk no matter what happens. Further in this article, we will explore different coverages you can choose. Let us start from the beginning.

1. General Liability

For instance, if the company is legally responsible for client damage or bodily injuries, you must handle the exceptional financial costs that may cause severe issues to your business. General coverage will protect you in these situations because the insurance company will handle the expenses associated with claims, meaning you can rest assured. 

For instance, if you are a roofing contractor and your tool drops onto a client’s parked car, damaging the windshield throughout the process. In this situation, the general liability is what will handle the car repair expenses since it happened due to your employee’s negligence, which can happen accidentally at times.

2. Workers Compensation

Workers’ compensation insurance will offer protection and benefits for employees, significantly if they get injured on the job. We are talking about covering wages and medical expenses with it.

For instance, the construction industry is problematic because accidents can happen anytime. Employees will be continually at high risk of hospitalization, meaning you should ensure you deal with each step along the way. They cannot work during that period, so they will not get relevant income. 

When you pay monthly for a compensation policy, the insurance company will handle their wages and medical bills, which will rest assured and prevent you from directly paying. Finally, you will give your employees peace of mind when they need to work safely and effectively. 

Besides, you will have additional security in knowing that you are not violating state and federal regulations while covering everyone who works for you. We recommend you click here to learn more about the different coverages you can choose. 

3. Commercial Car Insurance

Commercial car insurance will protect your specific situation’s third-party vehicles and automotive property. Although it is not specific to most contractors, it is a perfect policy if you use cars to transport employees and tools as the essential aspect of the project. 

The main idea is to use commercially insured cars, providing peace of mind. Generally, commercial car policies will address damage caused by vehicles or made to cars outside driving. It also covers injuries in case of accidents, which is vital to remember. 

4. Professional Liability

Architects, consultants, and build and design contractors use this type of insurance to protect themselves against client claims. Therefore, if you work in the trade, you can take advantage of complete coverage compared with customer dissatisfaction, failure to execute plans, and design flaws. 

Besides, professional policy will protect you against negligence while undertaking different duties and responsibilities. When your employee paints a wet wall, the problem will arise in seconds since the paint will peel off when it reaches the specific situation. 

The negligence will cost your client time and money, especially if they suspend their business to take advantage of construction projects. It means the provider will address the professional liability coverage. 

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The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.