The construction business is rewarding, despite the risks involved. Builders contend with on-the-job accidents, traffic collisions, theft, vandalism, and extreme weather. These challenges are factors that can contribute to financial losses for the contractor.
However, contractors should not suffer from things they cannot control. With the right insurance coverage, their construction businesses will remain strong despite mishaps.
Builders need to understand the value of getting contractors insurance. They should also know how they stand to lose money if things go wrong and third parties file claims against them.
Common contractor claims and corresponding insurance policies
The construction business is a venture that many people consider a high-risk business. It is a valid concern because the occurrence of the unexpected is always an impending threat, like tools falling and hitting someone. Every construction-related accident has a corresponding claim.
Property damage or personal injury claims/General liability insurance
Every legitimate contractor will have security as well as health and safety guidelines in place. But some accidents are unavoidable. If the accident results in damage to property or third-party injury, the contractor is liable to pay.
The builder needs general liability insurance that will cover most of the costs, like medical bills, damage repairs, work-time missed by the injured person, and damage replacement. If there is a lawsuit, the general liability insurance will pay for attorney’s fees, judgments, and damages owed to the claimant and miscellaneous court fees.
Worker injury claim/Workers’ Compensation
If your worker suffers an injury or falls sick while on the job, workers’ compensation insurance will cover the medical bills, the lost wages of the worker, the rehabilitation, lawsuits, and death benefits and funeral expenses. Workers’ compensation insurance protects your workers and ensures your business can continue to operate.
Traffic accident claim/Commercial auto insurance
On a construction site, many vehicles come and go each day. Project managers may drop by to check the work progress before moving to other job sites. Delivery trucks can come bringing construction supplies and machinery. You might also go in and out of the site for meetings. If you are using your car for business, your personal car insurance will not protect you.
You need commercial auto insurance that is more extensive.
- Liability coverage offers protection when you are responsible for the damage and injury to another person.
- Comprehensive and collision coverage covers the damage to your vehicle when the accident is your fault.
- Underinsured/uninsured motorists’ coverage covers property damage and injuries when the other driver who is at fault is underinsured or uninsured.
- Medical payment insurance covers payment when your passenger sustains an injury.
Claim for damage to a project in progress/Builders risk insurance
While a project is in progress, you may suffer an enormous setback. There could be wildfires, hurricanes, tornados, and other weather disturbances. You could incur damage and loss of construction supplies, tools and equipment, and machinery because of theft and vandalism. You do not want this to happen. Protect your business and your project with a builder’s risk insurance. It covers onsite theft, damage from weather disturbances, and damage to a structure in progress.
Make sure you have the most important insurance policies to protect you from the aforementioned events.