Why Every Flooring Contractor Should Have Insurance
Every contractor knows that insurance is required by law as part of the cost of doing business. Do you know, however, the kinds of insurance you should have as part of your business policy? It’s not always a good idea to carry the bare minimum and as a flooring contractor. Having the right insurance can not only mitigate liability issues, it can actually save your business from going under. Here’s a look at what you should carry, and why.
Required by law, general liability insurance is carried by all contractors in the flooring and carpeting industries. This kind of insurance serves to defend you against lawsuits brought by customers, vendors, clients and other third parties who claim harm, injury, property damage or reputation damage based on your actions. It covers lawyer and court fees as well as settlements and damages from claims.
License and Permit Bonds
These are required for state contractor’s licenses in most cases, or for building and construction permits in various municipal areas. They need to be renewed along with your license and the cost varies according to your local area. These bonds show that you are approved and licensed to operate in a given area.
Most contractors have a business office somewhere, and property insurance covers this office as well as your equipment, supplies, tools and general inventory. If your property is stolen, vandalized, damaged due to natural disasters like fire or other weather events, you can use this insurance to get reimbursed and recover your losses.
Business Owners Policies
A business owner’s policy (BOP) bundles several kinds of insurance into a single policy with a single discounted premium. Generally speaking, property and general liability are put together in this sort of policy and can make your policies much more affordable. The more insurance you bundle together, the more you save. Not every contractor can get this kind of policy, however. Check your local services to see if it’s possible for you.
If you have employees, you need workers comp insurance to cover costs related to injuries or illness at the job site. Accidents and illness do happen, from exposure to chemicals to cutting your hand on a box cutter. Having a workers comp policy will enable you to avoid costly lawsuits arising from these issues, and will help your workers get back on the job quickly.
Workers compensation insurance covers legal costs, lost wages, medical bills, damages from legal claims, support of dependents and even, if the unthinkable occurs, funerary costs. Most states require this kind of insurance.
Umbrella or excess liability coverage increases your protection from general liability, commercial auto insurance and workers comp in the case of damages or lawsuits that exceed your basic coverage. While not always required, it is the type of insurance that can save your flooring contractor business in the case of disasters or serious and high-cost lawsuits.