Important Things to Know About General Contractors Insurance

What is it and Why do I need it?

General Contractors Insurance is a type of insurance that protects contractors for a wide range of scenarios, from lawsuits from a customer to injuries at the work site. While a Business Owners Policy can cover some possible issues, General Contractors Insurance is more comprehensive in dealing with a wider array of risks. And because a contractor is essentially working for himself / herself, this type of insurance goes a long way in keeping the business protected and afloat. It’s essential to remember that as a contractor, a number of ‘safeguard’ laws regarding employment may not apply. The effects of an injury or property damage can be devastating.  Complaints brought to court can be dismissed, but legal work might not be covered under insurance packages not specifically suited for contractors. General Contractors Insurance can be the difference-maker between a contractor and financial burden.

Is General Contractors Insurance required to operate in my state?

Most states already require contractors to have General Contractors Insurance and most clients will ask if you have one anyway. A strong plan can go a long way in putting everyone’s mind at ease while showcasing the pretty professional side of your business.

Additionally, it helps keep you on the right side of any trouble you might have dealing with problems with workers or higher authorities should something arise that could potentially involve a large amount of money.

What does General Contractors Insurance Cover?

There’s a wide range that General Contractors Insurance can cover, although some of the biggest areas include possible property damage (meaning possible repairs for damages caused by work), bodily harm or injury at the work site (accidents at work), personal injury (reputational damage that may occur to a business due to your work) and medical payments. 

This type of insurance usually pays for areas which include general damages (which covers ‘vaguer’ or abstract areas such as ‘anguish’ and ‘pain’), compensatory damages (financial losses by the claimant as outlined in claim) and punitive damages (financial losses or fines due to missteps made or violations).

How much is General Contractors Insurance?

Compared to other insurances, it can be costlier in the short term. Construction is a high risk job in terms of potential accidents, ranging from a fall from a ladder to a ceiling panel falling off. Construction work is not easy and a number of things can go wrong at the job site. It’s not just a regular legal requirement – although as previously mentioned, most states require it and clients are a lot more scrupulous in ensuring a contractor is insured – but, in the long-term, it’s an important part of keeping contracting business going. Accidents are almost inevitable while running construction businesses over years and years. There are way too many stories of businesses going down because of one accident or debt because of substandard coverage. It’s more than just a minimum legal requirement; it’s an essential part of creating and building a thriving business. When in this line of work, it’s really not enough to just get what’s needed, but to go and get the best coverage to truly safeguard your business.