As a contractor, you probably know that you need to have adequate measures in place to protect yourself, your employees, and your business as a whole. One of these essential measures is contractors insurance.
Contractors insurance can cover claims resulting from lawsuits, on-the-job injuries, equipment damage, and liability issues. Having the right contractors insurance policies in place is essential to ensure that your company can handle these unexpected challenges, should they occur.
We know that choosing the right contractors insurance policies can be overwhelming. We’ve created this guide to help you understand the different policies available in the U.S., the requirements your business may need to meet, and other factors to consider.
Read on to learn more about choosing the right contractors insurance policy for your business –
Contractors Insurance Requirements in the State of Texas
As a contractor in Texas, you may need to carry certain liability insurance policies to stay compliant with state-wide requirements. All contractors in Texas must submit a Certificate of Insurance (COI) that shows their insurance coverage and limits. Depending on your type of contracting business, you may need to carry any or all of the following types of insurance:
- General liability insurance: This insurance covers most claims for non-employee, third-party property damage, or bodily injury. For instance, if you damage a customer’s belongings during an electrical service or a customer trips over your equipment and falls, general liability insurance for contractors could cover their damages.
- Workers’ compensation insurance: This insurance covers a worker’s injury or death incurred while on the job. For example, if your construction employee falls off the scaffolding and gets injured, workers’ compensation would cover this claim. Texas does not require most private employers to hold workers’ comp insurance, but you will need this insurance if you work with government agencies.
- Builder’s risk insurance: This insurance covers accidental damage to buildings under construction. Most lenders require this insurance before lending funds for construction projects.
- Commercial auto insurance: This insurance covers vehicles your contracting business owns that you and your employees use for job-related purposes. Personal auto insurance coverage is not sufficient to cover these work vehicles.
These policies can ensure that your business has the proper funds to cover injuries and damages for which you or your employees are liable. Speaking with an insurance agent can help you determine the exact policies your HVAC, plumbing, roofing, or electrician business needs to remain compliant.
The Top General Liability Insurance Policies for Contractors to Consider & Why
Purchasing all the insurance policies above can ensure that your contracting business holds the minimum legal requirements for insurance. However, you can also benefit from buying policies outside of these requirements.
Here are a few other types of contractors insurance you may want to consider:
- Business equipment protection: This insurance can pay to repair or replace tools and equipment in the event of accidental damage, theft, or loss.
- Commercial property insurance: This insurance covers the physical building out of which you operate your contracting business. If you rent your building, your landlord will probably require commercial property insurance.
- Professional liability insurance: This general liability insurance covers claims from mistakes you make on the job. It covers personal injury, negligence, copyright infringement, and more.
- Surety bonds: This written contract can give you clients monetary compensation if you fail to fulfill the obligation of the job.
The Benefits of Good Coverage for a Contractor
Having the right insurance coverage in place offers many benefits to your contracting business, such as:
- Legal compliance: Carrying the right insurance can ensure that your contracting business abides by Texas contracting laws.
- Financial protection: General liability coverage can ensure that a liability claim does not financially bankrupt your business.
- Legal protection: Contractors insurance can cover legal fees and ensure that you can afford adequate representation in a lawsuit.
- Peace of mind: Accidents happen, but with good insurance coverage, you can feel confident that you will be able to navigate claims against your company.
- Customer protection: Your customers will feel more confident hiring your business when they know you carry adequate insurance coverage.
- Employee protection: Workers’ compensation insurance and other policies that protect your employees can improve employee retention.
Get Contractors Insurance You can Count on Now
Every contracting business is unique and needs different contractors insurance policies to ensure comprehensive protection.
At Lee Insurance Agency, we can create a custom contractors insurance plan designed to meet your unique needs. Call us today at 281-812-8400 to get your free contractors insurance quote.