What Insurances Do 8A Contractors Have? Complete Guide

What Insurances Do 8A Contractors Have Complete Guide

While it’s true that life is a gamble, you should never risk what you can’t afford to lose. This principle holds weight in many different aspects of life, especially those involving substantial risk – hiring a general contractor.

Contractors, be it in electrical work, plumbing or construction, are often taking on high-risk tasks and projects. With lots of manpower and machinery needed simultaneously to get the job done on time, employers have much to monitor while working. To protect themselves from unanticipated events that could lead to financial losses, 8a contractors should ensure they secure a wide range of insurance policies like general liability insurance, professional liability insurance, commercial auto insurance, etc., as well as disability insurance for added security during their contract works.

In this article,  we’ll cover the types of insurance 8a contractors should consider and the types of contractors needing insurance. Let’s get started!

What Types of Contractors Require Insurance?

Contractors in all industries should consider insurance coverage to protect themselves and their businesses from unforeseen incidents. The type of insurance that is necessary for a contractor will depend on the nature of their work, as well as the size and scope of the contract.

Some common types of contractors who may require insurance include:

  • Construction contractors
  • Electrical contractors
  • HVAC contractors
  • Plumbing contractors
  • Landscaping and lawn care contractors
  • Handyman services
  • Roofing contractors

7 Types of Insurance Available to 8A Contractors

8a Contractors should consider investing in a variety of insurance policies to protect themselves from potential liability claims or damages. Some of the insurance types available to 8a contractors are:

1. Performance Bonds

These bonds are designed to protect a hiring party from any losses due to the other party’s failure to fulfill its obligations. In some cases, contractors may be required by law or certain contracts to purchase performance bonds as part of their insurance coverage.

With a bond in place, customers can rest assured that the job will be completed to their satisfaction. This safeguards them from contractors who do not fulfill the job or deliver shoddy workmanship. The bond ensures that all players are protected and provides both parties with an immense sense of security.

2. Commercial Auto Insurance

In most cases, 8a contractors use a vehicle for their business operations. This is why you need to invest in a commercial auto insurance policy that covers your vehicle and any employees who use it. Depending on the size of your business, this type of policy might include coverage for multiple vehicles.

3. General Liability Insurance

As an 8a contractor, it is imperative that you invest in a general liability insurance policy to safeguard yourself from potential expenses such as medical or injury costs. Not only does this type of coverage protect you against any damage caused due to faulty construction materials, but it also shields your clients’ property if the worst occurs.

It’s worth noting that general liability insurance will not safeguard you from losses resulting from professional negligence, so it is wise to couple it with a good quality professional liability insurance policy.

4. Professional Liability Insurance

Also known as Errors and Omissions Insurance, professional liability insurance can help protect you from costly negligence claims if an error or omission in your work leads to a financial loss for your client.

This policy covers financial losses resulting from claims of negligence, either internal or external, providing relief from the immense pressure during such nerve-wracking circumstances. Though it does not cover expenses for redoing a project, its coverage grants you peace of mind when facing difficult times.

5. Inland Marine Insurance

If you’re a construction contractor, you understand that your job necessitates regularly transporting supplies from one location to another. Therefore, having inland marine insurance is essential for protecting yourself and your business. Without this coverage, contractors are placing themselves at unnecessary risk of loss or damage during the transportation — making it an invaluable asset!

In the simplest way possible, Inland Marine insurance safeguards your products, supplies, and gear when transported across the land (generally by truck) or while kept temporarily at a job site or storage facility. With this coverage in place, you can avoid any damage incurred due to accidents, theft, vandalism, as well as a total loss.

6. Worker’s Compensation Insurance

Injuries sustained on the job are common in many industries, and contractors are no exception. Without adequate worker’s compensation insurance, you may be liable to pay workers’ medical expenses resulting from an accident or injury during your contracted work.

This type of policy is also available for independent contractors; however, it would need to be purchased separately. It is usually advisable to opt for such policies as they protect you from any potential litigation or compensation claims arising due to an employee’s injury while on the job.

7. Business Owner’s Policy (BOP)

A business owner’s policy is designed to offer 8a contractors the appropriate coverage for a variety of risks. This type of policy combines general liability insurance, commercial property coverage, as well as additional protections such as cyber liability or professional liability insurance into one package.

This all-in-one insurance package includes the most commonly sought-after coverage types, such as general liability and property damage. It also covers more comprehensive risks, like professional negligence and business interruption.

#1 8A Certified Contractor Valet Works

If you’re worried about the construction of your home’s interior or exterior, don’t hesitate to contact us at Valet Works. Valet Works is the #1 8A certified contractor in the USA, and we can ensure that your construction project will be completed on time and within the budget.

Contact us today to get started on your next construction project!

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