Construction and contracting occupations have some of the most risky and diverse work imaginable, often with risks that people aren't even aware of.
General contractors manage the construction of a new building or renovation to an existing building. General contractors generally specialize in constructing single family homes or commercial buildings such as factories, offices, restaurants, or stadiums. Most have a set group of permanent employees, and then subcontract the remaining tasks to specialty subcontractors. While firms whose employees do no actual construction work are commonly called "paper" contractors, they generally act as "prime" contractors for such tasks as framing carpentry, structural masonry, or metal building erection.
Mechanical tasks such as plumbing, heating, and electrical are usually completed by subcontractors.
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What Types Of Commercial Insurance Policies Should Contractors Have?
There are several types of business insurance policies that contractors are either legally or contractually required to carry or should strongly consider carrying. These policies provide protection for your property, the property of the clients you serve, as well as accidents and injuries your clients or employees could sustain. Business insurance policies that are considered crucial for general contractors include:
Commercial General Liability
Considered the most essential form of insurance coverage for business owners in every industry, commercial general liability coverage provides for the risks that are commonly associated with owning and operating a business, such as third-party injuries and property damage. For instance, if a client sustains an injury on the property you operate your general contractor business out of and files a lawsuit, commercial general liability insurance would help to cover medical costs and legal fees.
This type of coverage protects the property your business operates out of, including the physical structure of the property and the elements within it. It covers perils, including fire, natural disasters, theft, and vandalism. For example, if a hailstorm damages your commercial property or if someone breaks into your business and steals equipment, commercial property insurance would assist with the cost of any necessary repairs or replacements.
In most states, businesses that hire employees are legally obligated to carry workers' compensation; however, even if your state does not require this type of insurance, you should still consider carrying it. Workers' compensation insurance assists with the costs that are associated with injuries or illnesses that employees sustain while they are on the job. For instance, if an employee falls off of a ladder and breaks his back, workers' comp insurance will cover the cost of medical expenses. It will also pay for any lost wages, rehabilitation, and job training and placement for injured or sick employees.