When you’re a contractor, every job comes with its own set of challenges and risks. From unexpected workplace accidents to third-party property damage, the unpredictability is an inescapable part of the job. That’s why having general liability insurance isn’t just a good idea; it’s a necessity to safeguard your business against countless potential liabilities.
This blog will walk you through the essentials of general liability insurance for contractors, explaining why it’s crucial, what it covers, how it works, and how you can get the right coverage for your business.
Why Contractors Need General Liability Insurance
Contracting businesses deal with a wide variety of tasks, materials, and environments. These diverse scenarios create ample room for unforeseen incidents to occur. Without general liability insurance, even minor mishaps could lead to costly claims that could harm your business financially and damage your reputation.
Key Reasons to Have General Liability Insurance:
- Client Requirements: Many clients will require you to have liability insurance before even signing a contract with you.
- Legal Compliance: Some states require contractors to be insured to operate legally.
- Financial Protection: Covers legal fees, medical expenses, and property damage costs to avoid devastating financial burdens.
- Customer Trust: Being insured shows that you are a professional who prioritizes safety and accountability.
What General Liability Insurance Covers
General liability insurance is designed to protect contractors from a variety of claims that can arise during the course of their work. Here’s what it typically covers:
1. Bodily Injury
If someone gets injured on a job site—for example, a client trips over your equipment and gets hurt—your policy can cover their medical expenses as well as any legal costs if you’re sued.
2. Property Damage
Accidentally damage a client’s property while on the job? Liability insurance can cover the necessary repairs or replacements.
3. Personal and Advertising Injury
If someone accuses you of libel, slander, or copyright infringement in your advertising or business practices, general liability insurance can help cover legal expenses.
4. Products-Completed Operations
This covers claims related to services or products you’ve already completed. For instance, if a structure you built later causes harm due to a flaw, your insurance may step in.
Common Claims Covered by General Liability Insurance
Understanding real-world examples of claims can give you a better sense of why insurance is critical for contractors:
- A subcontractor sues you, claiming injury due to improper safety measures at your job site.
- While renovating a home, a burst pipe floods your client’s property, leading to significant water damage and expensive repairs.
- Your ad inadvertently violates another company’s intellectual property, prompting a lawsuit for copyright infringement.
Factors That Affect the Cost of General Liability Insurance
The cost of general liability insurance isn’t one-size-fits-all. Several factors influence your premium, including:
- Type of Work
Riskier trades like roofing or demolition tend to have higher premiums.
- Business Size
The more employees or subcontractors you have, the more coverage you’ll need.
- Coverage Amount
Higher coverage limits come with a higher premium, but they provide more robust financial protection.
- Claims History
A history of frequent or large claims can increase your premium.
- Location
Your geographic region and local regulations play a role in determining your rate.
How to Get General Liability Insurance
It’s easier than you think to secure general liability insurance for contractors for your business. Here’s how to go about it:
- Assess Your Needs
Identify the risks and scale of work your business handles to determine the appropriate coverage.
- Compare Providers
Shop around for quotes from reputable providers like Toth-Felty Insurance to find the best policy for your needs.
- Customize Your Policy
Work with an insurance agent to tailor your coverage to your specific business requirements.
- Review Annually
Regularly reassess your policy to ensure it continues to meet your needs as your business grows.
Why Choose Toth-Felty Insurance for Your Business
At https://tothfelty.com, we understand the unique risks contractors face daily. With over 50 years of experience, our team provides personalized service and works with a variety of top insurance providers to get you the best coverage at the best price.
What Sets Us Apart?
- Independent and locally owned.
- Trusted by contractors.
- Customized policies tailored to your specific needs.
- Exceptional customer support for claims and questions.
Secure your contracting business with insurance you can trust. Learn more here.
Safeguard Your Contracting Business Today
Operating as a contractor is rewarding, but it’s not without its risks. General liability insurance gives you the confidence to take on projects, knowing that your business is protected from unexpected financial burdens.
Don’t wait until it’s too late. Whether you’re working on residential projects, large-scale commercial builds, or anything in between, having sufficient liability coverage is a critical step in protecting your livelihood.For tailored advice and a free quote, contact Toth-Felty Insurance today. We’re here to make sure you’re covered every step of the way.