Contractors public liability insurance. A complete guide
Contractors public liability insurance introduction
Contractor insurance protects businesses from risks known in the construction trade, offering contractors and tradesmen peace of mind to continue doing their work.
Contractors public liability insurance has you covered whether you're meeting with clients on-site or working on a client's home. This coverage ensures protection from major reconstruction projects to minor renovations, and it's a necessity for many types of businesses.
To be adequately covered, a contractor should have general public liability, workers' compensation, and other customized coverages that we will highlight in this article.
We will examine the following topics in our contractors public liability insurance guide:
- What is contractors public liability insurance?
Who needs contractors public liability insurance?
What types of contractors need general liability insurance?
What does contractors public liability insurance cover?
Are contractors required to have insurance?
Contractors public liability insurance cost.
What is contractors public liability insurance?
Contractors insurance is an umbrella term for a specialized insurance package encompassing various business insurance coverages. Oftentimes, these insurances are required from a contractor.
Moreover, this personalized insurance plan can include public liability insurance, also known as general liability insurance, specifically for contractors.
Contractors public liability insurance helps to protect businesses and contractors from claims and resulting lawsuits caused by bodily injuries or damage to someone else's property.
Without adequate contractors public liability insurance or business liability insurance, business owners might face out-of-pocket costs for certain liability claims. To avoid that circumstance altogther, this insurance protects businesses and contractors from the financial risks that can result from serious work-related accidents.
Contractors public liability insurance is a vital coverage type for many types of business owners, as this insurance plan can cover the costs of many unexpected issues.
So now we know what this insurance type is, you may need to know if you and your business require contractors liability insurance.
Who needs contractors public liability insurance?
As a business entity, you may be required to have contractors public liability insurance coverage, either by law or by a company that hires you. Not to mention, this insurance may help you to sign contracts faster and look more desirable to potential employers.
Furthermore, it's essential insurance to have if you hire staff as this coverage can also include protection for your employees while covering your other business' assets.
What types of contractors need general liability insurance?
To summarize the above, the following contractors, tradespeople and construction businesses require general liability insurance coverage:
- General; concrete; masonry; excavation; paving; and drywall contractors.
- Roofers, plumbers, welders, carpenters, painters, landscapers, electricians, repair technicians, and home inspectors.
- Removal businesses, snow removal businesses, interior and exterior construction businesses, and tree surgeons.
As mentioned earlier, public liability insurance not only protects your business and assets, but many employers will require this insurance before they decide to work with you.
Depending on the type of construction you are carrying out or the project you are working on, the local authorities may also require that you meet general liability insurance requirements. Therefore, the right coverage ensures you safeguard your employees and your business, so it's essential to understand the different types of contractor insurance available to you.
What does contractors public liability insurance cover?
Different risks should come with different insurance plans, and we know that most contractors need several business insurance policies. Insurers have aimed to make this as hassle-free as possible with the option to purchase separate insurance coverages together in a personalized package.
So what exactly does contractors public liability insurance cover? Public liability insurance covers common risks that contractors face, from handymen to general contractors, as both businesses face high risks, whether small or large organizations.
Overall, contractors public liability insurance helps pay for third-party injuries and property damage expenses.
For example, if your client is injured on-site or if you damage your client's property by accident, public liability insurance can cover the resulting medical expenses or the cost of repairs.
Generally, contractors public liability insurance policies provide liability coverage related to the following:
- Product liability.
- Libel and slander.
- Customer injuries.
- Customer property damage.
We have listed how these coverages protect your business below.
Libel and slander
It's possible that libel and slander claims may be made while your business is advertising its construction services, for example.
General liability insurance will cover accidental advertising injuries if a business inadvertently copies its competitor's advertising, such as a slogan or an advertising campaign.
Contractors public liability insurance policies provide coverage related to the following:
- Copyright infringements.
- Defamation, both libel (written) and slander (spoken).
Product liability insurance
Also known as products-completed operations coverage, construction businesses and contractors should include product liability insurance in their liability policy plan.
This insurance coverage will insure your business against claims such as a bodily injury due to an on-site accident, or property damage due to faulty workmanship after completing a job.
For example, if a roofer repairs a roof with new tiles but one month later the homeowner discovered some new tiles had fallen from the roof. This coverage will help to pay the roofer's legal costs if the homeowner files a lawsuit over the faulty installation.
Customer injuries
As an example, if a client trips over your tools while you're busy working in their home, you could be blamed for the injury. If the client sues your business, you could end up paying for their medical and legal expenses.
That's when general liability insurance can help you cover:
- Medical bills.
- Settlements.
- Legal fees.
- Court-ordered judgments.
- Funeral expenses in fatal incidents.
Please note, this policy does not cover employee injuries. For employee injuries, you will need to purchase workers' compensation insurance.
Customer property damage
General liability insurance also safeguards businesses and contractors from costly expenses if a client's property is seriously damaged while being worked on.
For example, if a client's doors are damaged beyond repair during renovation work, your general liability policy could help pay for the cost of repairs or even replacements.
This policy can also cover lawsuit expenses if a client decides to take you to court over the damaged property.
Additional coverage
As noted earlier, a public liability insurance policy is just one part of contractor insurance.
To have a well-rounded plan you should consider getting additional types of business insurance. Some types of coverage you can get include:
Commercial property insurance
This insurance protects the building and equipment you use to operate your business, whether yours or your business rents them. This coverage includes:
- Tools.
- Computers.
- Power equipment.
- Heavy equipment.
- Data breach insurance.
If your personal business information gets misplaced or stolen, data breach insurance coverage will help you in this case. This coverage type is sometimes known as cyber insurance.
Business income insurance
If you can't run your business because of property damage, business income insurance coverage covers any income loss and may help cover your business expenses.
Workers' compensation insurance
If your employees experience a work-related injury, workers' compensation insurance will help to cover the expenses. Also known as "workers' comp", this coverage can help cover employees' medical costs, which is also beneficial to help them recover and return to work.
Are contractors required to have insurance?
The law may not require business insurance, but without general liability for contractors insurance and other coverages, you could be held liable for mistakes you made on the job. In addition to this, proof of insurance may be required from you before taking on a new job.
Generally speaking, it's a good idea for you to consider this insurance as a requirement for your contracting business, as it could ensure you have the financial protection you need in an emergency situation.
In summary, your contractors insurance will protect you if you need to cover expenses and damages, and you are usually required to show insurance to clients and those who hire you, even if the law may not require that same insurance.
Key takeaways
Contractors public liability insurance is vital to safeguard your business should unexpected emergencies, accidents, or damages occur. This will offer you the peace of mind that your business will be financially protected.
For your business and employees, that means you can get back to work without that uncertainty playing on your mind, while you can also feel confident you're offering your clients a high level of service.
Overall, public liability insurance for contractors ensures that uncertainties and the associated risks of running your business are taken care of so you can focus on your tasks at hand.
If you're considering contractor insurance for your business, it's worth knowing what affects insurance costs to understand your options.
Contractors public liability insurance cost
Public liability insurance for contractors costs are as unique as businesses are. Your public liability insurance policy reflects your business; no two business policies should be alike.
Insurance companies look at different factors when determining liability insurance quotes and when you are considering your business expenses to meet insurance costs, you need to look at the following factors.
The value of your insurance policy depends on the following variables:
- The project type.
- Number of employees.
- Type of business you own.
- Location of the project.
- Value of the project.
- The scope of contract works.
- Required coverage amount per policy.
- Policy details and deductibles.
- Construction period.
- Your relevant experience level.
- Your claims history.
- Use of subcontractors in the project.
- The surrounding areas (i.e. rivers, sea, forest, etc.).
As mentioned earlier, contractor insurance can insure your work based on the above factors, whether you need insurance for a large construction project or small renovations for your home.
You will need to provide information pertaining to the above factors to obtain a quote.
Contractors public liability insurance quotes
When considering what types of general liability insurance for contractors are needed for your business, it's helpful to receive various quotes to know your options.
Receiving a personalized quote can help you to decide what is best for you. The following can provide you with simple and hassle-free quotes.
Contractors insurance USA
For companies registered in USA you can receive quotation from Progressive Commercial.
Contractors insurance UK
For companies registered in UK you can receive quotation from Simply Business.
Contractors insurance Cyprus
For companies registered in Cyprus you can receive quotation from Pitsas Insurances by completing the quotation.
Our team of insurance experts can work with your financial budget to help you secure customized commercial general liability insurance and other contractor coverage policies.
Pitsas Insurances
Nicosia, Cyprus
04.10.2022