Every plumbing job comes with the risk of a hovering customer tripping over a tool or a small mistake in your work, causing a flood. No matter how much pride you take in your work, you’ll probably have at least one accident at some point during your career. When you do, plumbing contractor insurance can protect you.
What is Plumbing Contractor Insurance?
Plumbing contractor insurance protects you against a wide variety of risks that you could face in your plumbing business. Instead of being a single type of insurance, plumbing contractor insurance is actually a package of multiple insurance products. That allows you to pick the coverages you need and not pay for the ones that you don’t.
What Kind of Coverage Does Plumbing Contractor Insurance Include?
When you look at plumbing contractor insurance, it will usually include a few standard options. These are the coverages that most plumbing contractors select.
General Liability Insurance
General liability insurance gives you the broadest range of protections. General liability covers things like causing a flood while you’re working, having a customer trip over a tool, having a customer slip and fall in your retail store, or accidentally breaking a neighbor’s window as you move equipment.
Professional Liability Insurance
When you buy general liability insurance, carefully read the policy to see if it covers incidents related to your professional skill and expertise. That’s incidents caused by your installation work and recommendations you make to customers on what type of system they should install. Depending on your insurance policy, these incidents may fall under your general liability coverage, or you may need to add professional liability insurance.
Commercial Auto Insurance
Commercial auto insurance is a specialized type of insurance. While your general liability insurance is comprehensive, most general liability policies don’t extend to auto-related incidents. That could be an accident on the way to a job site or backing your truck into something while you’re moving supplies around the customer’s property. In addition, your personal auto insurance generally won’t cover these types of incidents, even if the truck you’re using is also your personal truck. Commercial auto insurance is what you need to protect yourself as well as to pay to repair your vehicle if it’s damaged while you’re working.
Commercial Property Insurance
It’s also important to remember that your liability policies apply to claims by others but not to your own property. If you have tools and equipment stolen or destroyed in a disaster, commercial property insurance is what will pay you to repair or replace them.
Workers’ Compensation Insurance
Not all plumbers need to carry workers’ compensation insurance since many work alone. However, if you do hire employees, Arizona law typically requires you to carry workers’ compensation insurance. Workers’ compensation pays your employees’ medical expenses and lost wages if they’re injured on the job. In addition to protecting your employees, it protects you from being sued for the same expenses.
Can You Get a Business Owner’s Policy Instead?
A business owner’s policy is basically the same thing as plumbing contractor insurance. It also has a package of the above options and can be customized to your needs. In some cases, a BOP may be identical to a plumbing contractor insurance package, and the insurance company just uses a different name. In other cases, a BOP may be more generic and intended to cover a wide range of businesses. For generic BOPs, you need to make sure that you understand what the policy includes and how to customize it for your plumbing business.
What Happens if You Don’t Have Insurance?
There are no broad requirements to have plumbing contractor insurance like there are with all drivers having to have car insurance. However, some jurisdictions may require proof of insurance or a bond before you can be licensed or get a permit. In addition, many customers will only work with plumbers who have insurance. Even if they trust your work, they still want the financial guarantee of insurance just in case something goes wrong.
How Much Insurance Does a Plumbing Contractor Need?
Since there are many different types of plumbing businesses, there are no clear answers on how much insurance coverage you need. All plumbing contractors should have enough insurance to cover the risk of causing severe injuries to someone while working. This will usually be at least $1 million in liability coverage. If you work on higher-value properties or have commercial clients that could lose revenue if a mistake in your work forces them to close, you may need higher limits to account for the additional risks. For your own property, you should select a limit that’s equal to the value of what you own and update it when you buy new tools or equipment.
How Much Does Plumbing Contractor Insurance Cost?
Your costs will vary based on your size, the work you do, your claims history, and other factors. Like other insurance products, you may be able to save money by increasing your deductible, making safety improvements, avoiding claims, or buying multiple types of insurance from a single provider.
Get a Quote
If you need help figuring out what type of insurance you need, talk to an independent insurance agent who works for you instead of the insurance company. Your insurance agent can help you make smart insurance decisions and then get quotes from multiple providers so that you can pick the best deal. If you’re near Phoenix, AZ, contact Dave Mohr Agency now to get started.