What you need to know about contractors insurance

It is a must for any company in the process of construction or renovation to acquire contractors insurance to safeguard its financial stability, as well as the well-being of its workers. It is not in the company’s interest to leave it susceptible to financial drains, in the event of management, material, and labor problems. Without a doubt, there are many risk factors present on a construction site, and all of them could harm a business, if not dealt with properly. Sure, the contractor may be held responsible for some of the problems, but most of the losses will be incurred by the property owner. Additionally, most states in the US require that they be insured before a project license is issued.

Contractors insurance basically covers losses due to lightning, vandalism, fire, lawsuits, injuries and other property damages that are not caused by professional errors or intentional acts. But there are certain policies that do not indemnify against earthquakes, acts of violence and floods. The safest plan you can apply for is contractor general liability insurance, as it usually takes care of all the basic concerns, when it comes to this type of activity. Generally, it is the responsibility of the building owner to purchase builder’s risk insurance and determine its scope. But, the general contractor can also take care of buying it, as stipulated in the contract. It is important to note that this type of property insurance is only valid during the construction period and ends upon completion of the project.

To ensure you get the best policy, it’s a good idea to shop around before settling on one provider. Submit your contracts for quotes if you’re a contractor and negotiate your policy rate if you’re a business owner. This should help you come up with a manageable monthly payment term that addresses your construction needs as well as your money constraints.

Next, you need to assess the overall supplemental status of your general contractors liability insurance to see who is covered. There are a number of other people who can enter a job site besides builders. You can expect couriers, crashers, licensees, and some guests to come by from time to time, so they should also be added as insured. To reduce exposure to liability, as a contractor, what you can do is determine the regulations within the workplace, enter into an agreement with the client, and try to be practical with any visits, to prevent potential accidents from occurring. It would also be wise to keep the site as free of hazards as possible by disposing of all materials carefully.

Lastly, never hesitate to use a specialist contractors insurance broker. This should make enforcement of the policy less onerous. A business owner and contractor would find a broker’s meticulous eye for detail and expansive network very helpful, especially for tight projects. Obviously, both cannot spend the proper amount of time going through each unique policy and crafting proposals. A broker will help you get there and match you with the right provider(s) as quickly as possible.