If you are a contractor in the Greater Toronto area you have a lot of responsibilities, including business risk management. No matter if you are a small contractor working for other companies or a major contractor with large projects, risk factors are an important part of your business. In fact, the right kind of contractors insurance can mean the difference between failure and success. Here is an example.
Henry L worked as a plumber and for years he enjoyed the work. However, Henry always wanted to be his own boss and dreamed of starting up his own home improvement company. For years, this was just a fantasy, and then one day he unexpectedly received a financial windfall. This was his big opportunity. Henry hired a crew and Henry’s Home Improvement Company was born.
Henry did not have a lot of business risk management knowledge or training, and instead of spending a lot of time learning about it, he decided to use an independent insurance agency with risk management professionals. Henry’s agent found him affordable contractor insurance. Whenever Henry needed advice on risk management, he now had a professional to turn to.
Henry’s first project went well and before long he was working full-time with a lot of satisfied customers. However, this changed about a year later. His home improvement company was sued by a former customer. The customer paid for a room addition and Henry’s electrician made a mistake with the wiring. A 15 amp circuit was installed with a 30 amp breaker instead of 15 amp breaker. Over time, this caused the wiring to overheat and eventually a fire developed. In fact, the fire spread and burned down the entire house.
Henry called his insurance professional and received good news. Because he had a full contractor’s insurance package he was fully covered for the incident, and was able to stay in business.
What is a Contractors Insurance?
This coverage is designed to meet the needs of the modern day contractor. It includes your crew, equipment, and legal liabilities. This way, you do not have to come up with a large amount of cash when financial problems strike.
Who Should Have Contractor Insurance?
If you are in the construction or home repair business you need to have your risk factors fully covered. This includes these businesses.
- Electrical contractors
- Residential handyman services
- Excavating services
- Landscaping contractors
- Professional painters
- Renovation contractors
- Roofing companies
- Heating and cooling contractors
- Siding contractors
- Residential and commercial construction companies
What does a Typical Contractor Policy Cover?
Contractors’ policies are not “one size fits all”. For example, an HVAC contractor may have risk factors that a roofer does not. However, most companies will need to consider these options:
- Commercial auto insurance – in Ontario you must have minimal liability insurance. Collision and comprehensive are also good coverage options for your vehicles.
- General liability – covers personal injury lawsuits. It may also cover incidents which happen to your crew and the general public.
- Equipment insurance – covers claims for theft or vandalism of your equipment at the job site or in storage.
- Business property insurance for your structures and buildings
Contractors Insurance Options
Your insurance agent may recommend these insurance options for your business:
- Builders risk or course of construction coverage. What would you do if one of your projects were suddenly destroyed by an act of nature, while it as partially completed? Builder’s risk insurance is there to pay for the damages.
- Installation floater – specialized builder’s risk policy to cover specific items or property.
- Surety bonds – you may want to bid on certain jobs (like government and large corporation projects). A bond guarantees the customer that your company can complete the project.
- By-law insurance – covers additional repairs or expenses related to violation of building codes.
- Tool and equipment insurance
- Contractor’s liability – errors and omissions coverage for contractors. Just one simple mistake could end up in a financial nightmare, and this liability insurance covers these issues.
- Wrap-up liability coverage – insurance package deal. A typical wrap up policy can take care of most of your risk factors. It may include vehicle insurance, property insurance, and liability coverage, and this can include insurance for your subcontractors.
- Environment liability insurance – If any of your work results in environmental issues or cleanup, this will pay for the damages.
Finding the Right Contractors Insurance
At Multi risk Insurance Brokers Ltd, we represent our clients, not the insurance company. We have a lot of experience taking care of the contractor’s needs in the Greater Toronto area. As an independent agency, we can get you the best deals on affordable insurance for your business, because we have many top insurance companies.
In addition to affordable insurance, Multi risk Insurance Brokers Ltd offers professional risk management services from fully qualified Canadian Risk Managers. You can receive the very best insurance protection for your company because it is customized to all your business needs.
If you would like to receive a quote on your contractor insurance, go ahead and fill out our quote form and we’ll contact you about a quote. You are also welcome to call us at 416-224-2800.