Contractors face a considerable amount of risk in their daily work. They can fall off ladders, slip on floors, or suffer from electrocution among other things. These unfortunate incidents can result in severe injury or death. The consequences of such accidents may be even worse in some cases. That is why insurance is critical for contractors in Texas and beyond. Unfortunately, the premiums demanded by many insurance companies are expensive. Contractors insurance Texas is not cheap if you are looking for the best, but here are some tips to find affordable coverage:
• Extensive research is unavoidable. In other words, you cannot find a cheap insurance company for contractors unless you search for them. Doing so takes time and a lot of effort. The best place to start is with other contractors who work in your industry. Ask them about their insurance company. How much do they pay in premiums each month? What kind of claims does the insurance firm cover? Get multiple responses and then make comparisons. Choose the one that has a balance between low premiums and high payouts.
• Going online is another excellent idea. Remember, people will vent their anger on the internet and contractors are not an exception. They will review a company based on the services they received. Do not go for an insurance firm that has negative reviews. More importantly, sites that compare insurance quotes offered to contractors exist online. Find a reputable comparison site and use the information on it to make a decision.
• Talking to an insurance broker might be of great help to you. Remember, these brokers represent numerous insurance firms. They know what each one of them offers. More importantly, they do not have a specific in you going to one of them. Instead, they want you to take up insurance through them even if you go for the one with the lowest premiums possible. Do not be shy when talking to an insurance broker. Be blunt and tell him that you want the best deal.
Save on Insurance Costs
These are the tips that will help you secure the most affordable Houston contractor insurance. Use them so that you can discover the best cover that you can afford. Remember that having insurance is critical in case your business suffers from damages or one of your employees suffers from an injury. Additionally, some customers will not work with you if you do not have insurance for your business. They are afraid of having to cover the costs if something goes wrong.…
Mistake 1 – Not realizing the true risk and consequences of a loss
Most contractors believe they will never have a claim and therefore do not value insurance. They think insurance is simply a business cost they must bear in order to get certain jobs. In fact, many contractors will cancel their insurance once a job is done to save money. Few ever read the policy and as a result, they are caught off guard when a claim is denied and they are exposed to massive losses that usually end up with the contractor filing bankruptcy. Ignorance is costly! Read your policy and ask questions.
Mistake 2 – Buying the wrong policy
Contractors general liability insurance is not standardized. Every insurance company offers different terms that can seriously impact the protection you get. As a general rule, the cheaper the policy, the less coverage. Ask your broker to explain the differences when you get quotes with different prices.
Mistake 3 – Ignoring the exclusions listed in the policy
Simply put, and exclusion is something that is not covered. If you are a general contractor who builds new homes and the policy excludes new construction, you have no coverage, even if you pay the premiums! If you are a plumber and your policy excludes water damage, who pays when your work causes a kitchen leak? If you paint building exteriors and the wind blows the pain onto 50 cars in the parking lot, who pays if there is an overspray exclusion? YOU DO!
Mistake 4 – Choosing the wrong broker or agent
Insurance is a very broad industry. Imagine trying to stay up to date on coverages and exclusions for every type of business. It’s just not possible. Choose a broker with extensive experience in ensuring construction and the trades. Your broker can give you insights to structure the right coverage and also suggest smart ways to save money.
Mistake 5 – Failing to make sure your subcontractors are insured
Most insurance companies require that your subcontractors carry limits of liability insurance equal or greater than your own, that you be additionally insured on their policy, and that your contract with the sub contain an indemnification/hold harmless clause. A good broker can help you determine if your subs are in compliance. If you fail to do this, you can be opening up yourself for a huge liability exposure in the event of an accident.
Mistake 6 – Switching insurance constantly
If you have a habit of switching insurance companies every year you may be creating more exposure and limiting your ability to generate premium discounts. Most insurance companies reward claim free accounts by reducing rates once the account has been with them a few years. This is very true with larger accounts. If you switch all the time, you never have the opportunity to generate these credits. Also, by switching constantly, you increase your exposure to claims denial from prior insurers depending on the language of your policy.