Excavation contractors face several risks, including having someone fall in a hole, hurting someone or damaging property with your equipment, or causing an earth movement that damages nearby property. To protect yourself from the liability that comes from those and other incidents, you must have the right insurance. Excavation contractor insurance can get you what you need.
What is Excavation Contractor Insurance?
Excavation contractor insurance is a customized package of insurance products designed explicitly for excavation contractors. The advantage over a generic business owner’s policy is that it’s easier to know that you’re covered for the specific risks of excavation work. With the help of your insurance agent, you can tailor your excavation contractor insurance to your particular needs.
Do You Have to Have Excavation Contractor Insurance?
Depending on what type of work you’re doing and where you are, you may need to provide proof of insurance or post a bond to obtain a license or pull a permit. More importantly, your clients are almost always going to require that you have insurance. They don’t want to have to worry about if you have savings to cover any accidental damage or injuries or if they’ll have to take you to court. Also, it’s a good idea to protect your business from having to pay a settlement that could cripple your operations or put you out of business.
What Coverage Does Contractor Insurance Include?
You can select the coverages that meet your business needs. Most excavation contractors choose these common coverages.
Commercial General Liability Insurance
Commercial general liability insurance covers your liability to others when you damage their property or cause injuries. This would include things like covering damage to a neighboring building or having someone get hurt if you didn’t securely block off your worksite. The risks that come with excavation are severe and require specialized coverage. If you’re looking at general liability policies that aren’t designed explicitly for excavation work, make sure that they do include coverage for excavations.
Commercial Auto Insurance
Liability for auto accidents or any other injuries or damage caused by your vehicles is separate from commercial general liability insurance. You also need to protect your vehicles from accident damage, non-accident damage, and theft. If you have bulldozers, backhoes, dump trucks, or similar heavy vehicles, you will need them on a specific commercial auto insurance policy. You also need coverage for any trucks or vans you use on the job. This is true even if it’s your personal vehicle that you have personal insurance on, because your personal insurance generally won’t cover any excavation work or driving that’s for business purposes.
Umbrella Insurance
Because of the high risk of causing severe property damage or physical injuries during excavation work, you may wish to increase your liability limits. Once you have the minimum amount of general liability and commercial auto coverage that you need, it’s often more cost-effective to purchase an umbrella policy rather than adding on to those limits.
Workers’ Compensation Insurance
Your workers are your greatest asset, and you want to protect them. According to Arizona law, you typically need to carry workers’ compensation insurance any time you have employees. Workers’ compensation will cover their lost wages and medical bills when they’re injured on the jobs. It also protects you from having to face lawsuits or payout claims for similar injury-related expenses.
Commercial Property Insurance
In addition to your work vehicles, you probably have tools and other equipment that you’ve heavily invested in. You may also have a garage or other building that you need to protect. Commercial property insurance protects you against things like theft, fires, and tornadoes.
Does it Matter What Kind of Work You Do?
Yes, there are many different types of excavation work, and each has their own insurance needs. If you’re digging a ditch for irrigation or drainage on an isolated farm, your risks are much lower than if you’re digging out the foundation of a new tower in a crowded business district. When you’re doing lower risk work, you may be able to select lower limits or need to cover fewer covered incidents than a contractor who engages in higher risk excavations. Your insurance agent can help you tailor your policy to your needs and budget. If your needs later change, you can adjust your policy at any time.
Can You Add an Additional Insured?
As an excavation contractor, you’re frequently working under contractors or directly for clients who want you to add them as an additional insured on your policy. This allows them to deal with your insurance company directly in case of a claim related to your work. Most insurance companies let you do this with a quick phone call or an online form at no additional cost.
How Much Does Excavation Contractor Insurance Coverage Cost?
Since there are many different types of excavation contractors, all with their own unique insurance needs, there is no specific price for excavation contractor insurance. You may be able to save money if you have the financial resources to carry a larger deductible or if you promote safety to maintain a claims-free history.
Get a Quote on Excavation Contractor Insurance
Your independent insurance agent can help you choose the right coverage options and get a customized quote from multiple insurance providers. Dave Mohr Agency serves Phoenix, AZ, and the surrounding area. Contact us now to start your quote or to request more information.
