Electrical contractors face a wide range of risks, including faulty work that could start a fire, injuring someone while working at a job site, having an employee get hurt on the job, or having a customer slip and fall while visiting your shop. Electrical contractor insurance protects you against these risks and gives both you and your customers peace of mind.
What is Electrical Contractor Insurance?
Electrical contractor insurance is a combination of different types of insurance that electrical contractors need. You can shop for each type of coverage individually, or you can get it all in one place.
Do You Have to Have Electrical Contractor Insurance?
There is no universal rule for electrical contractor service. Some jurisdictions may require electrical contractors to have a minimum amount of insurance or to post a bond when doing licensed work. Most customers will want to know that the contractor they hire is insured. Even though your customers are picking you because they believe you’re a good contractor, they know that anyone can make a mistake or have an accident. Insurance gives them a way of knowing that they can quickly recover from any accidents or mishaps that happen.
What Are the Different Types of Electrical Contractor Insurance?
There are several different types of coverage that you want to look for in your electrical contractor insurance package. These are the most common.
Commercial General Liability Insurance
Commercial general liability insurance is the most common type of insurance for all businesses and protects you against a wide range of losses. This includes things like customers slipping and falling in your store, accidentally injuring a customer or bypasser while working, causing property damage while working, or losses that arise from faulty work.
When it comes to insuring your work itself, you need to review the policy you’re buying. There are many different types of commercial general liability insurance policies on the market, and each policy covers different things and excludes different things. Some policies may exclude any kind of professional negligence and only cover general accidents. Most policies targeted towards electrical contractors will include coverage for fires or other damage that happen as a result of mistakes in your work or planning.
Professional Liability Insurance
Professional liability insurance covers specialized work. For an electrical contractor, this would be things like if you ran the wires correctly and chose a safe design. Again, you need to understand what you’re getting with your general liability coverage. If your general liability insurance doesn’t cover your work, professional liability insurance fills in the gap. Some insurance companies will offer a broader general liability insurance coverage that includes what others call professional liability coverage, while others will offer them as a package deal.
Commercial Auto Insurance
If you have a truck or van, you need commercial auto insurance. Your general liability policy doesn’t cover auto accidents or anything that happens with your vehicle. You also need coverage to protect the vehicle itself. If you’re using a personal vehicle, keep in mind that your personal auto insurance policy almost certainly excludes any type of accident that happens while conducting business from being covered.
Commercial Property Insurance
Commercial property insurance protects your tools and equipment against theft and damage from disasters like fires. If you have a building, you can get commercial property coverage for the building as well.
Workers’ Compensation Insurance
Workers’ compensation insurance is the one type of electrical contractor insurance that is legally required in most cases if you have employees. Workers’ compensation covers their medical bills, lost wages, and other expenses if they’re injured on the job.
Business Income Insurance
Business income insurance covers your lost income if you are unable to work due to covered causes. Covered causes can include things like a fire that destroys your shop, theft of your vehicle or tools, a pandemic, or a hurricane. You usually select an exact list of covered causes when you buy business income insurance and only have coverage for the causes you selected.
Does it Matter What Kind of Electrical Work You Do?
There are many different types of electrical contractors. Whether you’re a generalist or specialize in things like lighting, new construction, commercial, or residential, you need some kind of insurance. Since each type of work involves different types of risk and different types and amounts of losses, some insurance companies will adjust their pricing based on what type of work you do. Your insurance agent may also recommend that you do or don’t carry specific coverages, or suggest that you update your limits, based on the type of work you do or the clients you have.
How Much Does Electrical Contractor Insurance Cost?
Since there are many different types of electrical contractors as well as various insurance options, there is no set or average price for electrical contractor insurance. As with other types of insurance, adding more types of insurance or higher limits will generally mean paying more. However, considering what your business could lose if you don’t have insurance, this is usually a worthwhile investment. If you have substantial cash reserves, you may be able to lower your insurance premiums by choosing a higher deductible and handling smaller claims out of pocket.
Get a Quote
An independent insurance agent can help you figure out what coverage you need and help you quickly get quotes from multiple providers. Dave Mohr Agency proudly serves Phoenix, AZ, and the surrounding area. Contact us now to request a quote or get more information.