Business Insurance Tips for Construction & Contracting Professionals
No matter how well run your construction or contracting business is, there is no safeguarding against the unpredictable accidents or tragedies that may arise. For example, if one of your construction employees were injured on the job, would your business have the means to cover medical expenses out of pocket? What would your business do if a fire destroyed your supplies and equipment? In the event of unforeseen events, business insurance offers the needed financial security to keep your business afloat.
Before you purchase a business insurance policy for your construction & contracting business, take a look at this guide to help you in your search for the appropriate coverage:
1. Assess your insurance needs and risks. Before you shop for business insurance, you'll need to know what coverage you're looking for and what risks your business faces. For example, you may want to begin by asking yourself what risks your employees face at work? What equipment needs to be protected in the event of an accident? What coverage do your contracts typically require? Though you can do everything in your power to properly train employees in safety procedures and to drive safely while transporting equipment, the simple truth is that accidents happen all the time, and the best thing you can do to protect your business is to prepare it for the worst case scenario.
Your insurance company will determine the level of risk they'll accept when they review your application and your coverage will be based on this level of risk. Because the premium you'll pay for your coverage is dependent on these risks, it only benefits you as a buyer to know these risks in advance. As your business continues to thrive, your business insurance needs may vary, so be sure you annually reassess your coverage needs.
2. Find a provider that you trust. When you're in the market for business insurance and you take your search online, you'll find there's no shortage of options for you to choose from. The challenge lies in finding the time to sift through them all and choosing one with an "A" rating. One way to save time and energy in finding a competitive deal on business insurance is to work with an agency that maintains relationships with top-rated insurance providers. Agents make your life easier by doing the work of hunting down multiple quotes and sending them to you to compare.
The licensed agents at insureon have built relationships with A-rated insurance carriers in order to bring you reliable coverage that meets your business needs. After finding quotes for insurance policies that meet your needs, they'll send them directly to your email inbox. If you have questions about which policies are appropriate for you construction & contracting business, talk to one of our licensed insurance agents today!
3. Know that the cheapest policy is not always best for your business. As the owner of a small construction business, you likely prioritize your business needs above all other expenses, which means you'll benefit from thinking of business coverage as a necessary expenditure. A comprehensive insurance policy may cost a little extra, but in the event of a covered claim, your plan may offer more coverage than a less expensive option. You'll also want to prioritize your insurance company's reputation over the policy price, as some carriers are notorious for slower payouts for a covered claim, which can keep you out of work longer. The lesson here is to base your purchasing decision on the amount of coverage and the quality of that coverage rather than price alone.
Some construction & contracting businesses may benefit from a Business Owner's Policy (BOP), which bundles General Liability Insurance and Property Insurance into one plan — and usually at a lower rate. This policy offers a broad range of coverage and can be tailored with endorsements specific to your business needs if your business is eligible. Talk to an insureon agent today to see if this reliable coverage is beneficial to your business.
4. Work with construction & contracting insurance specialists. Coverages and premiums vary from company to company, so your best course of action is to work with brokers who specialize in insurance for specific types of business. Our experts at insureon, for example, know that as the owner of a construction & contracting business, you may benefit from Inland Marine Insurance, a kind of Property Insurance that protects your construction equipment while it's in transit. Our specialist agents understand the risks that are unique to your business and can help you find the appropriate coverage at competitive rates.
Typically, construction & contracting professionals will want to carry…
- General Liability Insurance
- Commercial Auto Insurance
- Inland Marine Insurance
- License Bonds / Permit Bonds
- Workers' Compensation Insurance
Additionally, some construction business owners also opt for Umbrella Insurance / Excess Liability coverage and a Business Owner's Policy if their company is eligible.
5. Know your policy, down to the fine print. It may seem like a daunting undertaking, but reading your policy thoroughly is imperative. Because each business insurance policy has different limits, exclusions, and fine print, it's important you understand the exact terms of your insurance coverage. This way you can protect yourself from gaps or excesses in your policy. You don't want to file a claim, only to be surprised when your policy does not include the damage or liability in its coverage.
6. Consider your deductible. It's worth noting that most business insurance policies come with a deductible (i.e. the amount you will contribute in the event of a covered claim). While a higher deductible may seem more appealing because of its smaller premiums, you may regret this decision in the event of a covered claim when you will be responsible for paying more out of pocket. On the other hand, a lower deductible usually means you pay more for premiums, but your insurance provider may provide a higher payout for your insured claim. While weighing your options, consider how frequently you might actually incur a covered loss, and how much of that loss you can afford to carry yourself. As a rule, do not agree to pay for a deductible that could put your finances at risk. After all, the purpose of business insurance is to minimize your financial strain in the event of a catastrophe — not to add to it!
7. Always overestimate your coverage needs. When you enter the territory of hundreds of thousands of dollars in business insurance, you may feel these amounts are excessive for a small business. However, if someone sues your construction business, the attorney's fees alone can exceed thousands of dollars. When added to other court costs and settlement expenses, you'll want to have every penny of insurance your policy provides. Many small business owners opt to extend their policy limits with Umbrella Insurance, an affordable way to offer millions of dollars in added protection to your Workers' Compensation policy, Commercial Auto policy, and General Liability policy.