Regardless of their size, almost all companies are lawfully required to have adequate insurance policies. This is especially the case for both the large companies and small companies and is equally effective for each. Covering the potential eventualities is very important and is obviously what the insurance companies are based on.
When it comes to contractors, insurance is often overlooked, with the importance of carrying out a contractor’s cover being underestimated. In several cases, many are actually unaware of what contractors are. Some even treat them as simply umbrella company operatives or as a glorified form of employees. To shed a light on this, contractors are fundamentally owners of business, and due to this, contractors may need insurance policies(especially contractors in California and Oregon) which are perhaps unknown by others.
It is essential for a business that is undergoing renovation or construction to purchase a contractors insurance policy, so as to protect their financial stability and the well being of the workers. It is not in the interests of the business to make it susceptible to work force problems, financial drains, or lack of essential management materials.
Certainly, there are several risk factors that are present in any construction site, and all of these have the potential to hurt the business if they are not dealt with properly. The contractor may surely be held accountable for some of the issues that may arise; however, the losses that will be incurred will affect the property owner. In most U.S. states, the law demands that before a project license is granted, the project should be secured.
Contractors insurance usually covers losses due to fire, lightning, lawsuits, vandalism, injury, as well as other damages that are not as a result of intentional actions or professional errors. There are also certain policies that do not indemnify against risks such as flooding, earthquakes, and various acts of violence.
The general liability contractors insurance is one of the safest plans that you can apply for. It basically covers all of the basic risks and concerns in this type of activities. Normally, it is the role of the building owner to obtain a builder’s risk insurance, in order to ascertain its scope. Nonetheless, the general liability contractor can be asked to acquire it, depending on the stipulations of the contract. More importantly, this type of property insurance is usually valid during the period of construction, after which, the period is terminated.
To make sure that you get the best policy, it is vital that you shop around and conduct some research before settling on an insurer. If you are the contractor, it is advisable that you can submit your contracts for quotes and try to negotiate intellectually the rate of the policy if you are the owner of the property. This will go a long way in ensuring that you arrive at manageable monthly premiums that will consider and address your monetary limitations as well as the construction needs.
In addition, you need to know exactly who is covered under the policy by critically assessing the supplementary general condition of the general liability contractors insurance. This is because, there will be a number of people who may enter the construction site aside from the builders themselves. These may include the messengers, licensees, trespassers, as well as some invitees who may come along every now and then. In this case, they must be added to the insured.
To minimize the liability exposure, the contractor should determine all the regulations within the construction site and plan or arrange an agreement with the client so as to pre-empt the possibility of occurrence of accidents within the site by trying to be more hands on with any visitation. It is also a good idea to keep the site as hazard free as humanly possible by ensuring that all the materials and equipment are kept or disposed properly.
You should never hesitate to go for those brokers who specialize in contractors insurance. This will help to ease the process of policy application, which can be quite burdensome. For stringent project, the contractor and the business owner will find the meticulous eye of the broker on expansive network and detail as well, very helpful. It may be difficult for both to dedicate the right amount of time going over each policy to draw up proposals. This is where the broker will help you, and essentially set you up the right provider.
Aside from the general liability contractor insurance, there are other types of independent contractors insurance that you can consider
1. Workers Compensation Insurance
Since the contractor has more than a handful of employees, this will require that a Workers Compensation Insurance cover be acquired. This is usually laid down by the state and it also requires that a disability insurance cover be taken for the employees. Workers compensation insurance usually protects the employee in case they are injured on the job, either on-site or off-site. Disability insurance protects the employees in case they get ill, disabled, or unable to work.
2. Commercial Auto Insurance
If the company holds the titles to one or more vehicles that involve employees driving them as part of their regular work, the business owner or the contractor may need to acquire a commercial auto insurance cover. This is aimed at protect the employees against the different types of accidents and wrecks on the job.
3. Marine Insurance
If the business involves warehousing inventory and shipping, you should get a suitable inland Marine insurance cover. This is aimed at protecting the goods against floods, ship wrecks, bad weather, and storms.
4. Certificate of Insurance
The certificate of insurance is the official document that states the name of the insured, their liability limits, the insurance company profile, as well as the dates concerning the policy. This is a very important document to the employer, as it is needed especially if a lawsuit has been filed.
Insurance for contractors is a necessary complete coverage plan, which is intended to safeguard the interests of the contractors while conducting business. This will reduce the dangers posed to the business of the contractor if any untoward incident happens while in the job.