Why do contractors need business insurance?
Jul 7, 2017 2 minute read
Owners of construction contracting businesses face a variety of risks, such as damage to their tools or being sued if they made an error in a project. These risks, such as lawsuits, are costly. Without insurance, contractors could face significant costs (such as legal fees) which could hurt their business operations. To strengthen the foundation of their business, construction contractors need insurance – this is where BrokerLink commercial insurance brokers can help. Our brokers assess the risks construction contractors face and find insurance which suits their needs. While dependent on the type of construction contracting business, here are six insurance coverages contractors can consider.
Six insurance coverages for construction contractors
Commercial general liability insurance
If there are injuries, fatalities or property damage caused by a construction contractor’s work, they could be sued. Commercial general liability insurance can help with legal fees due to these incidents. For example, if a contractor causes damage to a home during their work, commercial general liability could cover the costs of repair or potential legal fees.
Business property insurance
Construction contractors may run their operations from a specific location. This could be a building they own, a home office or a leased space. Business property insurance can help cover costs if the physical location of the contractor’s business is damaged. For example, if a construction contractor’s office space was damaged in a fire, business property insurance could help with the cost to repair the physical space. If the business owner runs their business from a home office their home insurance policy may not cover a loss. A BrokerLink commercial insurance broker will be able to inform the contractor will advise about which insurance coverage will best suit their needs.
Equipment and tools insurance coverage
From a computer to a clipboard, every business requires tools. Equipment and tools insurance coverage can help contracting businesses cover equipment-rental fees or replacement costs if their tools or equipment is damaged or stolen.
Commercial auto insurance
Contractors often use company vehicles for work purposes. If the vehicle becomes damaged or stolen during work activities, commercial auto insurance can help cover costs – such as renting another vehicle while the other is being repaired. If a contractor uses their personal vehicle while on work duties, personal auto insurance may not provide coverage if there is a loss. A BrokerLink commercial insurance broker will help contractors find the best auto insurance for their business.
Professional liability and errors and omissions coverage
If a contractor made an error or omitted important information which impacted the client, they could be sued. Professional liability and errors and omissions coverage could cover the financial costs of lawsuits should these events occur. A BrokerLink commercial insurance broker can help construction contractors determine which aspects of their business could cause these scenarios
More beneficial building blocks
Construction contractors can learn about other types of insurance coverages which could benefit their business by visiting our Construction and Contractors business insurance page. For contractors who are ready to “break ground,” they can contact a commercial insurance broker.