Like other specialty contractors, plumbing contractors invest a lot of time and money while building a business that supports their families and the families of their employees.
Just like flooring installers, electricians, and drywall contractors, plumbers face everyday financial risks while heading to the job site, while they’re at the job site, and after leaving the job site.
Easy Article Navigation
- What Insurance Does a Plumber Need?
- Contractors General Liability
- Workers’ Compensation
- Tools and Equipment (Inland Marine)
- Commercial Auto Insurance
- Other Coverages to Consider
- How Much Does Plumber Insurance Cost?
- Finding Affordable Plumber Insurance
And, like other specialty contractors, plumbing contractors may be working on multiple job sites simultaneously which increases their everyday risks like:
- Bodily injury to a third-party
- Property damage to a third-party
- Work-related injuries or illness to employees
- Liability resulting from company vehicles involved in accidents
- Product liability after installing products at the job site
- Damages to a rented workshop or storage building
- And many, many more…
Rather than risk losing business assets in a lawsuit, plumbing contractors should transfer these everyday risks to highly-rated insurance companies with affordable plumber insurance.
What Insurance Does a Plumber Need?
In order to mitigate the risks listed above, plumbing contractors need a package of coverages provided by an independent insurance professional who has the experience to offer advice about each risk and how to mitigate them.
General Liability (also called contractors general liability) will serve as the foundation to your insurance package because it provides a broad package of coverages. And most states that require plumbers to be licensed also require them to provide proof of general liability with limits that are equal to or greater than the statutory limits. Here are the types of liability claims that most general liability policies cover:
A type of insurance that most employers dread is Worker’s Compensation. It is state-regulated insurance coverage that is there to protect employees and the requirements vary by the state. Contractor Workers’ Comp policies provide the same basic coverages but can also vary by state.
This insurance is for medical expenses incurred as a result of work-related injuries, diseases, or illnesses. The benefits that are paid out are based on the severity and type of injury or illness:
- Medical Benefits – pays for medical care to treat a work-related injury.
- Income Benefits – pays a portion of the employee’s lost wages.
- Death Benefit – pays lost wages to the family of an employee killed on the job.
- Burial Benefit – pays a portion of funeral expenses.
Tools and Equipment (Inland Marine)
Plumbing contractors need to understand that their tools and equipment are not covered under their commercial auto policy. For this reason, every contractor should consider purchasing Inland Marine insurance so that the cost of replacing stolen or damaged tools will be paid by their insurance policy.
There are four types of property covered under your inland marine insurance:
- Property being transported (Cargo)
- Contractors Equipment (Hand Tools)
- Computer Equipment and Data
- Buildings under construction (Builders’ Risk)
Additionally, Inland Marine Insurance will also provide coverage for:
- Accounts Receivable data
- Property in your care, custody, and control (property under repair or maintenance)
- Cameras and Drones
- Surveying Equipment
- Property in exhibition
- Equipment dealers’ property
If you are a plumbing contractor who drives one or more vans or pickups with your business name on the vehicles, your personal auto insurance will exclude coverage since your pickup or van is used for business.
But when you switch to a commercial auto insurance plan and add each of your company’s vans and pickups to the policy, you can typically save money on your annual premium and you’ll find that there are generally no limits on the number of vehicles or drivers that can be listed on your policy.
Additionally, commercial auto policies can be purchased with higher limits than personal auto policies offer.
Other Coverages to Consider
Not only will a license bond be required when you are applying for a license in your state or jurisdiction, larger clients and governmental entities will generally require a bid bond if you are planning to bid on large contracts.
Most large customers like airports or government buildings will require higher limits than what you are carrying on your general liability and commercial auto policies. If you find yourself needing more liability coverage, a commercial umbrella policy will allow you to add up to $10 million in liability coverage.
If you are renting office or warehouse space, many landlords require tenants to purchase commercial property coverage to protect your business personal property and the glass in the building as well.
How Much Does Plumber Insurance Cost?
Your cost for a comprehensive commercial package of policies will depend on various underwriting factors when you apply for coverage such as:
- Number of years you’ve been in the plumbing business
- Limits of liability you choose for your plumbing contractor insurance
- Estimated yearly revenues
- Estimated number of customers serviced each year
- Claims history over the last 5 years
- Value of vehicles, equipment, and tools
How to Find Affordable Plumber Insurance
Certainly, in the 21st century, most insurance products can be purchased online, and in many cases, directly from the insurance company. Don’t do that!
To make certain that you have transferred all of your everyday business risks, look for an experienced independent insurance broker who can provide you with a complete package of coverages for your plumbing business.
Why spread multiple policies over multiple insurance agencies when you can have one-stop insurance shopping through Fairbanks Insurance Brokers. The insurance professionals at Fairbanks are experienced agents who understand the construction and construction services industry. They represent many commercial companies but are not employed by them.
This independence allows the Fairbanks Insurance Brokers to put their clients’ needs first and foremost. They will advocate on your behalf through the shopping, underwriting, and purchasing process. They will be there for you at each renewal to make certain that you are still getting the best deal possible and they will recommend changes as your business grows.
Here is What We Recommend
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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