Home Improvement Contractor Insurance Ct – Remodeling contractors have an incredibly diverse range of risks. Not only do they have to manage subcontractors, sell their services to clients, and design remodeling—they need expertise in a variety of trades to successfully complete a project.
That’s why remodeling contractors are more difficult to insure with the right coverages and reasonable prices compared to some of their commercial counterparts. Here are some of the problems contractors face and how to solve them:
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Remodeling and renovation companies can find it difficult to categorize their workers’ compensation codes. While it may be tempting to choose the cheapest classification, this is never the best method.
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The problem is that each remodeling company has different class codes based on whether they do remodeling, commercial remodeling, interior remodeling, structural remodeling, or very light work (like painting and light fixtures).
If you choose a lower rated classification code and an auditor chooses a different class code during the audit, it will often result in a larger premium increase.
Our recommendation: Make a list of all the jobs you’ve done in the previous year and the types of jobs you need for your employees. After completing that list, assign each of those tasks to a workers’ compensation class code.
After finding your correct class codes, you can track how many hours your employees spend on each type of work, or combine all payrolls into the highest rated classification code.
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When a remodeling company requests a quote on insurance, the insurance company often doesn’t understand what they are insuring because a remodeling company’s activities can vary widely (framing, roofing, painting, electrical, plumbing, etc.).
Our recommendation: Keep a detailed description of the jobs you’ve completed in the past year, what jobs you’re currently pursuing and what jobs you’re turning down (d).
This will help the attendants understand the scope of what you are doing and get the right policy for your business.
Remodeling contractors have the longest deductible lists in the insurance industry. This happens not only because underwriters feel like they don’t understand the operations of a particular remodeling company, but because they have experienced significant claims from remodelers.
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The example above was quoted to a remodeling contractor by one of the popular online insurance companies. As you can see, insurance companies try to exclude any liability when dealing in the remodeling and renovation industry.
Every policy has exclusions, but some policies have more than others. Exclusions not normally included in other policies are highlighted above (eg Why a sexually transmitted disease exclusion in a contractor’s policy?). All kidding aside, there are some exclusions in the example that are really bad for your business, such as “Coverage limit per business description”. I have never encountered some of these exceptions in my life! The lesson here is to read your policy thoroughly.
Our recommendation: Instead of automatically adding every deductible available to the policy, our recommendation is to take your time and partner with an insurance provider who gets to know your business.
The remodeling company in the example above was able to find a regional insurance company to provide coverage. The promisor worked through the remodeling company’s operations and relied on the client’s promises for the work they did. The process took two weeks, but the result was a very affordable, broad policy with very few exceptions. Below is a form table of the best quote for you to see the difference.
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Insurance companies are always nervous about overusing subcontractors. A large number of carriers are willing to write a policy with a contractor that subcontracts under 30% of their work. Anyone who subcontracts more than this base percentage will have difficulty getting coverage. This is true even if all of your subcontractors have liability insurance, including yourself as an additional insured.
With many remodeling contractors using subcontractors for over 30% of their work, this can be a real problem when trying to get insurance because there aren’t many options.
Our recommendation: Tell your insurance broker about the controls you have in place for subcontractors, how you supervise subcontractors, and if they’ve been working for you for a long time.
Additionally, collect certificates of liability from all of your subcontractors listed as an additional insured so that your business stands out among other insurance filings.
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Our insurance policies are customized to your business, allowing us to address issues that other companies cannot. Schedule a quick call to learn more.
Every remodeling company needs public liability insurance. This insurance covers property damage or bodily injury as a result of a project.
One of the most important coverages in a general liability policy for a remodeling contractor is “complete operations,” which covers your work after the job is done.
For example, if you make a mistake in remodeling a bathroom and the pipes leak a few weeks after the project is completed, causing water damage to the building, the completed operations coverage will cover that damage.
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Although workers’ compensation is necessary to protect your business from risk, it is required by law in most states.
This policy will cover your employee’s medical bills and lost wages if they are injured on the job. This is a big deal for remodelers and the construction industry as a whole, as the industry has a significant amount of workplace injuries.
If you have any work truck or work van, you should get commercial vehicle liability insurance. It covers damages you incur due to an accident and damages to your vehicle, regardless of fault.
We recommend adding both employed and non-owned liability insurance to your policy, especially for remodeling contractors. This covers liability that you may incur due to a vehicle that you do not own. For example, if a subcontractor has an accident on your job site and you are sued, this policy will protect your company.
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For many industries and businesses, getting a quick and easy online quote is a great idea. For remodelers, you can run into a ton of deductions in the quotes we looked at above.
When it comes to getting insurance, you should take your time at least one week out of two weeks to find something good. Because once you find a quality policy, you can renew it every year without extra work.
And generally, there is little or no difference in price between a quality policy and a poor policy.
Austin is an experienced commercial risk consultant specializing in property and casualty risk management for religious organizations, real estate, construction and manufacturing.
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The information on this website is provided for informational purposes only. Nothing on this website should be construed as a solicitation, proposal, offer, recommendation, endorsement or advice regarding any insurance product. The information on this website is general in nature and is not a substitute for personal consultation with a licensed insurance professional. In no event shall we undertake to advise you on the need for any insurance product. You are responsible for deciding what insurance products you need. We are licensed insurance brokers in the following states: WA, OR, ID, MT, WY, CA, NV, UT, AZ, CO, MN, SD, NE, KS, OK, TX, IA, MO, AR, LA, WI, IL, KY, TN, MS, IN, GA, FL, OK, VA, NC, SC, DE, MD, DC, NJ, CT, RI, VT, NH, PA and ME. Insurance products and features are subject to underwriting criteria and may not be available in all states. Send via email, attachment or fax. You can download, export or print it.
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5 Key Elements Every Construction Contract Should Include 1) Scope of Projects. 2) Cost and payment terms. 3) Project duration. 4) Protection against copyright law. 5) Dispute Resolution Clauses.
Should I Use My Insurance Company’s Contractor?
Here’s how. Check the contract terms. The basic job of a contractor contract is to spell out the scope of the project. Set up a payment schedule. Schedule start and end dates. Specify change orders. Explore your arbitration options. Disclaim contractors’ warranties.
8 Things Every remodeling contract should include a scope of work, specification sheet and drawings. License number and insurance. Explanation of Change Orders. Warranty information. Subcontractor Agreements. Fee schedule. Completion Schedule / Timeline. Clauses required by law.
How to Plan a Remodel in 5 Steps Create a detailed home improvement project plan. Set the project budget. Hire contractors. Create a timeline. Pack up and get ready to renovate your home. Ask your contractor plenty of questions. Plan for problems when
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