If you are a general contractor, you surely have a lot on your shoulders. It doesn’t matter what are you building, it can be a house, a mall, a football stadium, or a building, you have a lot of subcontractors that are working for you, and they also, have subcontractors working for them. Subcontractors are important because each has a specialty, it can be roofing, plumbing, or framing, and many more. The thing you need to think about in advance is what if a fire destroys your construction site, and destroys the building you are working on. What if one of the workers falls and gets injured, and sues you? To protect yourself from financial loss, you need a General Contractor Insurance.
It doesn’t matter if you’re a commercial contractor or a residential, Farmer Brown Insurance can help you. With them you can have General Contractor Insurance, that will provide adequate protection for your business.
General Contractor Liability Insurance
It is essential for your protection to have a General Contractor Liability Insurance. This type of insurance provides protection against claims of property damage or bodily injury. It can cover your legal defense if someone sues you, and pays claims or judgments up to the limits of your policy. It also backs you up on the costs of medical care or property repair.
For example, you’ve built an apartment building, and it now has the wrong flooring, or even worse, it has leaks everywhere. On a busy construction site, there are many things that can go wrong. General Contractor Liability Insurance covers all of those possibilities.
When you have many workers involved in projects, they operate on heavy equipment, they work on roofs and climb ladders, you must have an insurance in case someone is injured. Here are some of the most common causes of construction site injuries:
- Exertion injuries
- Chemical injuries
- Falls from heights
- Falling objects, such as tools or heavy equipment, that can hit workers or passerby
- Electrocution due to exposure of high voltage overhead or underground power lines or faulty power tools
- Fire and explosion injuries
- Trenching accidents where dirt caves in on someone
Subcontractors have their own general contractor liability insurance, but someone who sues will likely sue all parties involved. The courts always hold the general contractor, as the overall manager, ultimately responsible. Even if you have an indemnification agreement with a subcontractor, those agreements aren’t always honored.
This type of insurance is required in most states, so that employee on-the-job injury are covered. If a subcontractor doesn’t have general contractor workers compensation insurance, they are covered by the general contractor. Which means that they are your responsibility.
One more thing that your builder’s risk insurance need to cover is construction and everything that will be part of the structure. If something that’s sitting outside is damaged, builder’s risk protects you against financial loss. You will be covered in case of any damage that is done to building and the compensation is determined by looking at the current development stage of the property and objects on it.
How much is General Contractor Insurance?
General Contractor Insurance cost can be a bit expensive. But at Farmer Brown Insurance you can find good rates, that suite you.
The reason for higher rates for general contractor liability is because you are responsible for all of the subcontractors and their employees and because construction is a very dangerous occupation. Liability rates are different if you’re building a small family house versus a skyscraper. Some other factors that affect liability rates are the size and number of buildings under construction and the payroll of the subcontractors. The insurance also varies depending on the scale of the project, but you can get special policies for specific types of projects.
Commercial Contractor Insurance
For large projects or ones that might take more than a year to be completed, a contractor will have a wrap-up and purchase commercial contractor insurance, both liability and building risk, that covers all subcontractors. That means that policies are different for small versus large commercial contractors. The mentioned above is done for large commercial projects, like skyscrapers, football stadiums or school building constructions.
Residential Contractor Insurance
You need to get general contractor insurance quotes that are specific to residential contractors. These type of insurances varies based on the size and value of your project and the number of subcontractors. There are also policies for contractors who build only one house and some different policies for contractors who are building multiple housing units.