Construction can be a high-risk industry. Unfortunate incidents can take place on any work site for many reasons. Equipment misuse, scaffolding mishaps, weather conditions, inexperienced workers, and more can create an unsafe environment.
Construction liability insurance protects businesses from property damage, injuries, and accidents. Eliminating the chances of something going wrong is virtually impossible. It’s in a company’s best interests to be sufficiently covered in the event of a disaster. Inadequate coverage can bankrupt a business and potentially impact personal finances depending on the damages.
There are several types of construction insurance. The costs of each are decided by a range of factors. Learning the basics and importance of construction liability insurance can help your business guard its assets. If you take the extra step to figure out what areas you need to be covered, then you’ll be better prepared when you investigate different policies and their costs.
3 Types of Construction Insurance
Insurance isn’t necessarily an easy concept to understand. There are different kinds for numerous circumstances. This holds true with the construction industry. The three common types of construction insurance are:
- General Liability Insurance: This kind helps protect businesses in a variety of scenarios resulting in injuries or damage.
- Workers Compensation and Employers Liability Insurance: This covers both the employer’s liabilities under workers compensation laws and employees’ injuries that do not fall within the workers compensation statute.
- Business Vehicle and Commercial Auto Insurance: This covers company vehicle and bodily damages when an employee causes an accident.
If your business employs contractors who use company trucks, then you might need these and other types of insurance. Every institution has a unique situation that determines its coverage levels and costs. For example, if your enterprise specializes in building houses, then you may need Builders Risk insurance. Additionally, insurance statutes vary from state to state.
There’s a lot to keep in mind when choosing insurance. All of the information can overwhelm you. The abundance of what you should examine is only one element that can deflate your spirit. Insurance rates are just as important as the actual policies. Sometimes prices are so high that companies can’t bear their expenses.
Can You Afford to Not Carry General Contractor Insurance?
The costs of all the coverage your business requires can add up. Cheap general liability insurance for contractors might not cover every contingency. On the other hand, the best general liability insurance for contractors isn’t necessarily the most expensive.
Researching several insurance companies can offer a better idea about general contractor insurance cost estimates. If you don’t see the need for this type of insurance, then ask yourself the following two questions:
- Can you imagine what you would have to pay out if you didn’t have general contractor insurance?
- What if you were injured by someone who wasn’t covered?
Not carrying contractor insurance can bankrupt a company if they have to pay a claim out of its assets. Bankruptcies can also devastate lives. Some people put all they own on the line when they operate a business. Losing it all because they were not insured can be utterly heartbreaking. Minimizing risk via insurance can diminish the consequences of negligence and unforeseen misfortune.
Your Small Business Insurance is Not Enough
The best general liability insurance for small business enterprises might be enough for an operation that doesn’t have many liabilities. A construction company is rife with risk. Every eventuality should be covered – even ones you don’t think will ever become an issue.
The liability insurance small business enterprises carry can keep them afloat if they are forced to pay a major claim. Investing in general liability insurance coverage for small business enterprises is a wise decision that demands careful consideration.
What Does Construction Liability Insurance Cost?
Insurance is the coverage of risk. Any construction insurance for dummies resource will probably tell you this. As such, rates aren’t set in stone. Insurance companies typically set their rates based on several variables that include, but aren’t limited to:
- the size of your establishment: Multiple employees generally produce a greater potential risk than an organization with one employee.
- the kind of work your company performs: Working in a controlled environment usually carries less risk than one whose employees work outdoors where they’re more susceptible to weather and other external influences.
- The insurance company’s prestige: An insurance firm might charge more simply because of its history and name.
Despite the price of construction general liability insurance, your company should assume as little risk as possible. With money, livelihoods, and reputations on the line, your business needs construction liability insurance.
If you worked hard to get your company up and running, then you should strive to keep it fiscally sound. After all, what’s the point of owning a business if it isn’t profitable?