New homes pop up every day with more advanced and expensive equipment than ever. The homebuilding industry is growing fast, and it's more important than ever for businesses to carry coverage for themselves and their clients. Finding the right policy can be the difference between your business running smoothly or running down. Having contractors insurance can protect you and your business from going into debt due to construction liability issues and more.
Contractors insurance may include such coverage options as:
- General Liability Insurance: This offers protection in case of bodily injury, property damage, personal or advertising injury. Personal and advertising injury can relate to claims made by third parties. General liability can also guard against negligence claims.
- Property Insurance: This coverage is incredibly important when building or remodeling homes. It protects against damage done to important equipment and fixtures.
- Residential Builder's Risk Insurance: This is a type of property insurance that protects a building against damage as it's being constructed.
- Umbrella Insurance: This helps fill in the gaps left over from your other liability policies.
- Commercial Auto Insurance: You can purchase auto insurance for vehicles used or owned by the business. Personal auto insurance policies won’t provide coverage in these scenarios.
- License/Permit Bonds: To build in certain areas, you may need a license or permit bond.
- Homeowners Warranty Items: This coverage protects you when items that are covered beneath a homeowner's warranty are damaged.
- Workers Compensation Insurance: Most businesses are required to have workers compensation insurance. This provides coverage when an employee gets injured at work during their shift.
You can also choose to invest in a business owner's policy, which combines property and liability insurances. If you transfer a lot of tools and equipment, you may also want to consider inland marine insurance. Commercial and personal auto insurance may not necessarily cover equipment within the car. Inland marine insurance provides coverage for your items while they're in transit.
How Much Does Contractors Insurance Cost?
The cost for contractors insurance depends on the amount of coverage you choose to have. Builder's risk insurance can cost around 4 percent of the construction budget. For general liability insurance, general contractors may pay a median of around $90 per month.
Homebuilding is a risky business, but finding insurance shouldn't be. Consider your business' needs before shopping for contractors insurance. That way, you know how much insurance you want and what type of coverage you need.