Running a contracting business comes with many responsibilities, and one of the most crucial is managing insurance. Many contractors focus on insuring their tools and vehicles, but understanding liability insurance can be a bit trickier. This type of insurance is essential for protecting your business from various risks, including accidents that might occur on the job site.
General liability insurance is a must-have for contractors. It covers third-party bodily injuries and property damage, such as slip-and-fall incidents or any damage caused during a project. However, depending on the nature of your work, you might also need professional liability insurance. This type covers claims related to mistakes in design or project management. If your work involves consulting or advising, having this coverage is critical.
One common request contractors face is the need to provide a certificate of liability insurance. This document shows proof of your coverage. However, the details matter. Sometimes, clients want to be listed as an additional insured, which means they want to be covered under your policy. This often requires a specific endorsement, so it’s vital to review these requests carefully and consult with your insurance agent before responding.
If you use subcontractors, it’s also important to ensure they have adequate insurance. You should ask to be named as an additional insured on their policies and request certificates of insurance. This practice helps protect your business if a subcontractor causes damage or injury while working for you.
When dealing with certificate requests, be cautious of any specific language that might be required. Some requests may ask for wording that could conflict with your current insurance coverage or even be illegal. Always consult with your insurance agent before making any changes to ensure compliance.
In addition to general and professional liability insurance, there are other important coverages contractors should consider. Workers’ compensation is often required by law and protects employees injured on the job. Commercial auto insurance covers vehicles used for business, while inland marine insurance protects tools and equipment during transit. Builders risk insurance covers structures under construction, and umbrella liability provides extra protection when claims exceed your primary policy limits. Employment practices liability insurance can also help guard against claims related to workplace discrimination or wrongful termination.
Choosing the right insurance partner is essential for contractors. Working with an experienced agent can help ensure you have the right coverage from the start and throughout your projects. Whether you’re handling certificate requests or managing subcontractors, having the right support can make a significant difference in protecting your business.