Construction is a risky business, and job sites are frequently humming with activity. Workers, contractors, huge machinery, and more are required to complete the task, which raises the possibility of injuries, third-party damages, and potential legal action.
On the one hand, developing technology and machinery are reducing some company hazards, but on the other hand, they may ultimately increase risks. It is possible to minimize risks, though, by making sure you have the appropriate insurance coverage.
Let’s examine the numerous insurance policies that your construction company might require.
1. Insurance for general liability
Every company, especially the construction industry, should purchase general liability insurance. It shields your business against numerous liabilities, such as damage claims and ensuing medical costs.
Additionally, general liability insurance protects your company against lawsuits resulting from property damage you may do to a client’s home or from harm brought on by a product you installed, like leaky plumbing or inadequately sealed windows or doors.
2. Insurance Coverage for Professional Liability
Everyone errs occasionally. Professional liability insurance covers errors in design, value engineering, or shop adjustments that can seriously affect a project. It covers errors that could have a negative financial impact on a project, as opposed to general liability coverage, which only covers bodily injury and property damage.
3. Insurance Coverage for Pollution
As one might anticipate, pollution responsibility covers you if you are at fault for an incidence of pollution at a job site. On a job site, bringing chemicals or fuel tanks for recharging equipment increases the possibility of breakdown. General liability policies usually do not cover pollution liability, though a limited endorsement can add.
Nevertheless, these pollution endorsements frequently offer far less protection than a separate standalone pollution liability insurance, so it’s crucial to assess your amount of risk to make sure you’re adequately insured. In
4. Commercial auto and business vehicle insurance
Even if your fleet is small but you still have vehicles with the company’s title, you should ensure commercial auto coverage is in place. There may be coverage gaps when a car is personally owned yet used for work.
There are ways to avoid this if it does occur, but it is almost always in everyone’s best interest to title the car in the business’s name and have a commercial auto policy.
You can insure various commercial vehicles, ranging in size from automobiles and trucks to considerably larger ones like tractor trailers, dump trucks, and cement trucks. The central tenet is that everything that needs a license to be used on public roads in the state where you conduct business needs to be covered by a commercial auto policy.
6. Surety bonds or contractor license bonds
To guarantee that consumers receive the services and finished projects promised, certain towns and states demand that contractors acquire licensing and permission bonds.
A legally enforceable agreement also helps guarantee that the contractor will pay for any materials and labor needed to finish the task and won’t leave the client with the tab. In addition, most city and municipal contracts call for a performance and payment bond to protect their financial interest in the deal.
7. Insurance for workers’ compensation
Most states mandate workers’ compensation insurance to protect workers from missed income and medical costs resulting from work-related accidents. Additionally, it aids in shielding a business from claims stemming from those injuries.
Although the state frequently sets the premiums, there are possible ways to cut your work comp costs. It would be best if you increased safety to decrease the volume and seriousness of injury claims.
8. Cyber Insurance
Protecting the data of your organization and that of your clients and third-party vendors is one of the business insurance categories that is expanding the quickest. The need to protect all that streaming data grows as construction enterprises increasingly employ technology, whether it be software platforms to manage business operations or tools and intelligent technology used on job sites. Make sure you obtain the appropriate level of cyber insurance protection.
To sum up
Compared to many other businesses, the construction industry faces particular hazards and, as a result, needs various levels of security. Not sure which of these insurance policies is best for your construction company? Contact a strategic risk advisor to discuss how to safeguard your company’s interests and bottom line effectively.