{"id":914,"date":"2023-10-21T14:54:19","date_gmt":"2023-10-21T14:54:19","guid":{"rendered":"https:\/\/businessyield.com\/ins\/?p=914"},"modified":"2023-10-21T14:54:22","modified_gmt":"2023-10-21T14:54:22","slug":"general-contractor-insurance","status":"publish","type":"post","link":"https:\/\/businessyield.com\/ins\/business-insurance\/general-contractor-insurance\/","title":{"rendered":"General Contractor Insurance: Coverage, Cost & More"},"content":{"rendered":"

Of course, you shouldn’t put anything in danger that you can’t afford to lose, even if life is a gamble. When it comes to major life decisions like selecting a general contractor, this guiding concept is extremely important to keep in mind. While it may save money in the short term, hiring a contractor without insurance is risky. When you hire a general contractor for a building or renovation project, they are responsible for the construction as well as the management of the site. This burdensome duty also carries with it a substantial risk. In this article, we will discuss Texas general contractor insurance coverage, cost, requirements, and how to get cheap insurance.<\/p>

What is General Contractor Insurance?<\/strong><\/span><\/h2>

General contractor insurance, often referred to as general liability insurance, is a type of coverage designed to protect construction professionals and their businesses from various risks and liabilities. This insurance provides financial protection if the contractor is held responsible for property damage, bodily injury, or other third-party claims arising from construction projects.<\/p>

General contractor insurance typically covers legal fees, medical expenses, property damage costs, and other liabilities that may occur during construction activities. It safeguards contractors against lawsuits, ensuring their financial stability and allowing them to focus on their work without worrying about potential legal or financial setbacks.<\/p>

Additionally, contractors may also opt for additional coverages such as workers\u2019 compensation insurance to protect their employees and business equipment insurance to safeguard their tools and machinery. Having the right insurance in place is crucial for contractors, as it offers peace of mind and a safety net in case unexpected incidents or accidents occur during construction projects.<\/p>

Types of General Contractor Insurance<\/strong><\/span><\/h2>

Listed below are the three essential types of insurance for contractors. You can use these classifications to narrow down your search for insurance products; they don’t include every possible type of protection, and you may need coverage that falls into a different category.<\/p>

#1. Contractor Essentials<\/span><\/h3>

This tier is designed for freelancers and tradespeople that require just the basics. They don’t need a lot of insurance or bonds because their operations are modest, their projects aren’t very high-risk, and the company doesn’t have many valuable assets.<\/p>

Contractors General Liability<\/span><\/h4>

If a contractor causes harm to a third party, their liability insurance will compensate the victim. When it comes to protecting yourself against the legal consequences of doing business, this is one of the most crucial policies you can get as a contractor.<\/p>

Equipment Coverage<\/span><\/h4>

Coverage for equipment, often called inland marine insurance, safeguards it against things like weather damage and theft. The policy can extend nationwide protection to most contractors’ tools, vehicles, and machines. Also, you can get it by itself or as an extension of your business owner policy (BOP) if you’re a contractor.<\/p>

Workers Compensation<\/span><\/h4>

Workers’ compensation insurance provides financial support to employees who sustain injuries on the job. This is typically the most costly aspect of a contractor’s insurance policy. Finding a carrier that offers services to maintain a low experience modifier is essential, despite the fact that charges vary depending on the type of contractual trade you are in.<\/p>

Keeping the experience modifier low is beneficial for two reasons: first, it is a long-term strategy to save money on insurance premiums, and second, it improves your chances of winning bids on projects with strict experience modifier thresholds. Your open claims will be monitored more closely by an insurance firm that focuses on experience modifier reduction, and the injured worker’s medical care will be handled in a more proactive manner. <\/p>

These insurance providers employ tactics like education on how to avoid opioids, occupational medicine, and return-to-work initiatives, to name a few.<\/p>

Commercial Auto<\/span><\/h4>

Pickup trucks and other vehicles, from a single car to a fleet of hundreds, are common tools of the trade for contractors. In the event of a collision involving a commercial vehicle, the policyholder will be reimbursed for any medical expenses and\/or property damage incurred. Afraid of what might happen?<\/p>

Property Insurance (If You Own Real Estate)<\/span><\/h4>

Property insurance covers the structures and contents of certain buildings. Contractors aren’t the only ones who don’t always need this type of company insurance, especially if they operate out of a rented office or their own home. Larger construction firms will want this coverage if they possess buildings or storage space for equipment.<\/p>