Contractors Insurance
Specialized Business Insurance for Contractors
For many businesses, vehicles are essential to daily operations.
Contractors face risks that are very different from those of a typical business.
Employees working on job sites, expensive tools and equipment, commercial vehicles, subcontractors, property belonging to customers, changing project locations and contractual insurance requirements can all create exposures that need to be considered.
John Scott Insurance helps contractors evaluate these risks and build commercial insurance programs around the way their businesses actually operate.
For contractors needing specialized expertise, John Scott Insurance also operates Contractors Insurance Agency, a division focused specifically on insurance for contractors and construction-related businesses.
What Insurance Does a Contractor Need?
There isn’t one insurance policy that covers every risk a contractor faces.
The appropriate insurance program depends on the type of contracting work performed, employees, payroll, vehicles, equipment, subcontractors, projects, contracts and geographic area.
Coverage commonly considered by contractors includes:
General Liability Insurance
General liability insurance can help protect a contracting business from certain third-party bodily injury and property damage claims.
Contractors regularly work at customer properties and job sites where an accident or property damage can lead to significant claims.
Workers’ Compensation Insurance
Construction and contracting work can expose employees to falls, tools, machinery, lifting injuries and other job-site hazards.
Workers’ compensation may provide benefits for employees who experience qualifying work-related injuries or illnesses and may be required depending on the state and circumstances of the business.
Commercial Auto Insurance
Contractors often rely on trucks, vans and other commercial vehicles to transport employees, tools, equipment and materials.
Commercial auto insurance can help address exposures associated with vehicles being used for business operations.
Contractors Equipment & Inland Marine Insurance
Tools and equipment are essential to most contracting businesses — and they frequently travel from one job site to another.
Inland marine or contractors equipment coverage may help protect eligible tools, equipment and other business property while it is being transported or located away from the contractor’s primary business location, subject to the policy.
Commercial Property Insurance
Contractors who own or lease offices, shops, warehouses, garages or other business locations may need commercial property insurance to protect eligible buildings, contents, inventory and other business property.
Commercial Umbrella / Excess Liability
A serious accident or liability claim can exceed the limits of an underlying insurance policy.
Commercial umbrella or excess liability coverage may provide additional limits above certain underlying policies, depending on the policy structure.
Builders Risk / Installation Coverage
Depending on the type of contractor and project, builders risk or installation coverage may help address certain property exposures associated with materials, equipment or work during construction or installation.
Coverage varies significantly by project and policy, so contractors should review these exposures as part of their overall insurance program.
Personal Auto vs. Commercial Auto Insurance
One of the most important questions for business owners is:
Can I use my personal auto insurance for business driving?
The answer depends on how the vehicle is being used and the terms of the policy.
General Contractors
Construction businesses overseeing projects, employees, subcontractors and multiple job-site exposures.
Electrical Contractors
Electricians and electrical contracting businesses working in residential, commercial and other environments.
Plumbing Contractors
Plumbers and plumbing businesses dealing with property, installation and job-site exposures.
HVAC Contractors
Heating and cooling contractors installing, repairing and maintaining HVAC systems.
Excavation Contractors
Businesses operating heavy equipment and performing excavation, grading and related work.
Masonry Contractors
Contractors performing brick, block, stone and other masonry work.
Carpentry Contractors
Carpenters and woodworking contractors performing framing, finishing, installation and other construction services.
Well Drilling Contractors
Contractors performing drilling and related specialized operations.
Insurance Built Around How Your Contracting Business Operates
Two contractors in the same trade can have very different insurance exposures.
One may have three employees and primarily work on residential projects, while another may employ multiple crews, use subcontractors, operate heavy equipment and work on large commercial projects.
When evaluating a contractor’s insurance needs, important considerations can include:
- Type of contracting work performed
- Residential vs. commercial projects
- Employees and payroll
- Subcontractor use
- Commercial vehicles
- Tools and equipment
- Job-site locations
- Work performed at height
- Heavy equipment
- Property belonging to customers
- Contractual insurance requirements
- Certificates of insurance
- Prior claims and loss history
- Geographic operating territory
Understanding the contractor’s actual operations is an important part of identifying potential exposures and appropriate insurance options.
Why Contractor Insurance Requires Specialized Knowledge
Contractors operate in an environment where risks can change from one job to the next.
The work performed, employees, subcontractors, equipment, vehicles and contracts can all affect the insurance a contractor may need.
Insurance carriers may also evaluate contractors differently depending on their trade, annual revenue, payroll, subcontractor costs, years in business, safety practices, loss history and geographic territory.
Working with an agency familiar with contractor insurance can help business owners better understand these exposures and the insurance options available to them.
Contractors Insurance Agency A Specialized Division of John Scott Insurance
John Scott Insurance has expanded its commercial insurance expertise through Contractors Insurance Agency, a specialized division focused on serving contractors and construction-related businesses.
Contractors Insurance Agency works with contractors across Michigan, Indiana, Illinois, Wisconsin, Iowa and Minnesota and has developed specialized knowledge around the risks faced by construction businesses and individual trades.
The Contractors Insurance Agency team includes Construction Risk Insurance Specialist (CRIS) professionals who focus on contractor-specific insurance needs.
This specialized focus allows contractors to work with an insurance team that understands their industry while being backed by the experience and resources of John Scott Insurance.
Frequently Asked Questions About Contractors Insurance
What insurance should a contractor have?
Coverage needs vary based on the contractor and type of work performed. Contractors commonly consider general liability, workers’ compensation, commercial auto, tools and equipment/inland marine, commercial property and umbrella or excess liability coverage.
Does a contractor need general liability insurance?
General liability is commonly used by contractors to address certain third-party bodily injury and property damage exposures. Customers, general contractors, landlords or project owners may also require evidence of liability insurance before work begins.
Does a contractor need workers’ compensation insurance?
Requirements vary by state and business circumstances. Contractors with employees should review applicable workers’ compensation requirements and their workplace injury exposures with an insurance professional.
Are a contractor’s tools covered by general liability insurance?
General liability is generally not intended to insure a contractor’s own tools and equipment against theft or physical damage. Contractors equipment or inland marine coverage may be used to insure eligible tools and equipment, subject to policy terms and conditions.
Does a contractor need commercial auto insurance?
Contractors using vehicles for business operations should review their commercial auto exposures. Trucks, vans and other vehicles used to transport employees, equipment or materials may require commercial coverage.
Are subcontractors covered under a contractor’s insurance?
Not automatically. Subcontractor relationships can create significant insurance and contractual considerations. Contractors should discuss subcontractor use with their insurance professional and understand carrier and contract requirements.
What is a certificate of insurance for a contractor?
A certificate of insurance provides information about certain insurance policies and limits in place at the time the certificate is issued. Contractors are frequently asked to provide certificates to customers, general contractors, property owners or other parties before beginning work.
Does contractor insurance cover work in multiple states?
Coverage and insurance requirements can vary by state. Contractors operating across state lines should discuss their full operating territory with their insurance professional.
Where can contractors get specialized business insurance?
John Scott Insurance operates Contractors Insurance Agency, a specialized division focused on the insurance needs of contractors and construction-related businesses.
Let’s Talk About Your Contracting Business
Your insurance should reflect the work your company actually performs.
Understanding your trade, employees, subcontractors, vehicles, equipment and job-site exposures can help identify potential gaps and determine which insurance options should be considered.
John Scott Insurance and Contractors Insurance Agency can help contractors review their exposures and explore insurance solutions for their businesses.