Cabinet installation contractors are currently in big demand. Learn how to financially protect your business!
With the housing market finally on the rise and homeowners wanting to remodel outdated kitchens and pantries, cabinet installation contractors are in very high demand.
Moreover, individuals who need custom cabinetry work done in their homes or businesses, are likely looking to hire a cabinet installation contractor who can build custom cabinets as well as install them.
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This industry is very competitive but there is a lot of business to go around. Whether you are new to cabinet installation or veteran cabinet installer, you must be aware of the everyday risks of being in business and then transfer those risks to a highly-rated insurance company.
Following is a list of coverages that every cabinet installer needs to protect their business from the financial devastation that can result from a lawsuit.
Commercial General Liability
All veteran contractors understand that a general liability policy is pretty much a no-brainer. A commercial general liability policy provides the coverage needed by every contractor because it protects you from third-party claims if you or an employee makes a mistake that causes bodily injury or property damage.
Additionally, your general liability coverage will cover defense costs if a suit is brought against you or your company. Lawyers are very expensive so having those costs picked up by an insurance company is considerably important.
Here is a brief description of the risks that are covered under your commercial general liability insurance policy:
Bodily Injury Liability
Bodily injuries are physical harm that often results from minor and major accidents. When injuries are more than minor, they may require immediate medical care, emergency room treatment, surgeries, and treatments by specialists.
Additionally, there may be ongoing recovery costs, medications, and more. If your company is judged to be responsible for the injuries that occurred, when the incident happened on your business location or on a worksite where your company was conducting business, general liability pays for the necessary care.
Property Damage Liability
Cabinet installer liability insurance protects your company from the risk of personal property damage. You or your workmen may be sued if they cause damages while installing cabinets or other products at a customer’s home, and general liability pays for any legal defense you need in those cases.
Products and Completed Operations (very important!)
A cabinet installer’s general liability insurance policy includes protection against civil lawsuits that may be filed due to work you have previously performed.
When your completed operations or products that were sold in the past to a customer are believed responsible for property damages then they will file suit against your company and this provision protects your business from any losses related to these types of claims so long as proper procedures were followed during installation which is what all businesses must do before billing their clientele!
Most of these claims are filed weeks, months, or even years after a job is completed!
Damage To Premises Rented To You
In most cases, cabinet installers rent a warehouse to store products and equipment for future jobs. Additionally, some cabinet installers are also cabinet makers and are at risk of causing damage to the warehouse or storefront that you rent.
If substantial damage should occur, your general liability policy will pay to repair or replace the building you have rented.
Personal and Advertising Injury
General liability insurance covers you in case of personal injury (financial loss) or advertising injuries. Advertising lawsuits can arise when it is alleged that your company used unlicensed materials, made misleading statements about the products they sell, or leads to a financial loss of business by hurting someone’s reputation.
These claims are when defense cost coverage can be substantially important.
Medical payments to others is a critical coverage that should never be overlooked. This coverage is triggered when a third party suffers minor injuries at the job site and needs medical attention as a result. With this coverage, proof of liability is not required for the insurance company to pay the medical expenses of the injured party.
Workers’ Compensation Insurance
Whether your cabinet installation business is a one or two-person operation, or a small or mid-size operation, most states will require you to show proof of a workers’ compensation policy. Additionally, being open for business without this coverage could expose your business to substantial fines and lawsuits if an employee gets a work-related injury or illness.
In states that require a cabinet installation business to be licensed, you can count on having to show proof of workers’ compensation coverage and a license bond.
Commercial Auto Insurance
Most cabinet installation businesses typically own a van, pickup, or box truck to transport tools & equipment and cabinet installers to the job site. Additionally, many cabinet installers must deliver the cabinets to the job site as well.
Your commercial vehicles must be covered under a commercial auto policy even if you as the business owner personally own all of the vehicles used in your business.
You cannot circumvent this and neither would you want to. Commercial auto policies offer higher liability limits at very affordable rates and there is generally no limit on the number of vehicles or drivers listed on the policy.
Your commercial auto policy provides the coverages you need and the limits your customers want you to carry. You will protect your business from liability claims as well as the costs of repairing or replacing your vehicles in the event of an accident.
Inland Marine Insurance (tools and equipment)
Although a commercial auto policy offers comprehensive coverage for your vehicles, it does not provide coverage for your tools and equipment if damaged or stolen.
Many small contractors will store their tools and equipment in a locked trailer in between trips to the job site. If your trailer full of tools mysteriously disappears, you’’ likely end up having to spend a day at Harbor Freight to buy the tools you need before arriving at the job site.
You can pay for tool and equipment costs out-of-pocket or you can have your insurer pay for it. It’s up to you.
The Best Way to Shop for Insurance for Cabinet Installation Services
Lately, because of innovative technology, some insurance companies are offering commercial insurance policies directly to contractors.
When you buy directly from an insurance company and bypass the advice of an experienced and reputable independent insurance professional, you are putting yourself at a disadvantage that could result in financial loss if your business is not properly protected.
National commercial brokers like Fairbanks Insurance Brokers are staffed with independent agents who specialize in the construction and remodeling industry. The professional at Fairbanks will walk you through every risk associated with your business type and provide an affordable solution for mitigating all of the risks associated with operating a Cabinet Installation service.
We encourage you to contact us through our website or call us at 949-595-0284
Here is What We Recommend for Cabinet Installation Contractors
General Liability: Contractors General Liability will be the foundation of protection for your business. The coverage will respond if you or your employees are found liable for bodily injury, property damage, or have a products/completed operations complaint. The coverage also covers defense costs for your business to respond to any lawsuits brought by a third party.
Workers’ Comp: Many states will require contractors to provide workers’ compensation coverage for their workers before they can begin a project. Accidents will happen at the job site that can result in an employee becoming injured and missing work. Your workers’ compensation coverage will provide financial assistance for medical expenses and lost wages.
Surety Bonds: It’s very likely that your state will require you to be licensed before you can begin operations. Most states and customers will require contractors to offer a license or surety bond before you are allowed to bid on a job or begin working.
Commercial Auto: Typically, most contractors will have light and heavy vehicles that require commercial auto insurance to make certain their vehicles can be repaired or replaced in the event of an accident, vandalism, or theft.
Tool Coverage: Also known as Inland Marine Insurance, this policy will provide for reimbursement for expenses to repair or replace tools and equipment. Your tools represent an important part of your livelihood, so we always encourage carpentry contractors to consider this valuable coverage.
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