When running your business, you must comply with specific insurance requirements and hazards as an electrical contractor. In addition to adhering to consumer and licensing standards, Electrical contractor also need to Electrical Contractor Liability Insurance safe guard your business against litigation and accidents involving its property. rugbyqa.com will provide for you some information about Electrical Contractor Liability Insurance in this post.
What insurance does an electrical contractor need?
Electrical contractors might need to hold a variety of insurance coverage. However, these five will typically meet your needs:
General Liability (Electrical Contractor Liability Insurance)
Every electrician needs general liability insurance for electrical contractors, regardless of how big or small their company is.As a result of their completed work or their activities on the job site, this coverage covers any property damage or bodily injury they cause to others (whether it be a business or an individual).
Given the nature of electrical job, you should definitely think about this insurance. If you cause harm as an electrician, whether it is an electrical shock or a building fire, you are accountable.
If workers are hurt while performing duties for your business, workers compensation Electrical Contractor Liability Insurancewill cover the costs of their medical care and missed income.
The majority of states mandate that every company with employees purchase a workers compensation policy. It is still a smart move to buy this insurance policy even if your state does not have this requirement. Without it, you would be liable for all of your injured employee(s)’s medical costs and disability benefits.
Contractors Tools & Equipment
You utilize a lot of tools for your job, such as pricey wiring in your work truck and hand tools. A Electrical Contractor Liability Insurance tools & equipment policy might assist in covering these costs if the equipment is damaged or stolen.
Typically owned and operated by the company, work vehicles or freight vans require commercial auto insurance coverage.
The use of the work vehicle by you or your employees may expose your company to responsibility. It covers all the automobile hazards that could affect your company, including as being at fault in an accident or getting hit by an uninsured car. It also talks about fixing your car if it is damaged.
Electrical Contractor License Bond
Many states require their electricians to carry a licensing bond since electrical contracting is a highly skilled trade with a significant level of liability if work is completed incorrectly. Although not insurance, this bond is typically obtained from your insurance company. It is a monetary promise that you will carry out work in accordance with your license.
Common Insurance Requirements For Electricians
Additional Insured Endorsements
You will probably need to add the project owner or your general contractor as an additional insured on your insurance if you are an electrical contractor working on commercial projects or for a general contractor.
This means that you and the general contractor will be covered by your insurance in the event that either party files a lawsuit as a result of your activities.
Waiver Of Subrogation Endorsements
A responsibility claim is frequently handled by your insurance provider, even when other parties are at fault. When it is later discovered that another party was to blame for the claim, subrogation takes place. This is the time when the money your insurance company spent settling a claim against the at-fault party or their insurance policy will be partially reimbursed.
For instance, your insurance company will represent you in the claim and most likely pay for fire damage brought on by the installation if you installed a faulty electrical panel that caused a fire. After the claim is settled, your insurer will make an effort to recoup the money it expended by suing the manufacturer of the electrical panel, who was ultimately to blame for the occurrence.
Even if a named party was negligent in triggering the claim, a waiver of subrogation prevents your insurance company from recovering funds from that named party.
Additional Liability Limits
Your carrying capacity requirements will increase in direct proportion to the size of the projects you work on. All of the aforementioned regulations typically have a $1 million cap, but many projects call for anything between $2 and $25 million.
An excess liability (or umbrella) insurance policy can help you with this. You can raise your limitations as high as is necessary to meet the demands of your project.
Electrical Contractor Claims Examples
Electrical Contractor Liability Insurance: House Fire Caused By Construction Defect
A home builder hires your electrical contracting company to install the electrical in a newly built custom home. Once the installation is finished and tested, the homebuilder approves the work, and your team moves on to the next project.
A year later, you receive word that the house for which you installed the electric system burned down and that an electrical system malfunction was to blame. In addition to the house being destroyed, the smoke and fire caused injuries to two family members.
A general liability coverage would pay for both the destroyed property and the medical expenses associated with the fire you started as well as cover property damage and bodily harm.
Workers Compensation: Employee Fell From Ladder
One of the workers falls from a step ladder while operating the electric for a light fixture. The worker reaches out their arm to catch themselves, breaking it and injuring their wrist in the process.
It is later discovered that the employee requires surgery for their arm, with a recuperation time of about a month.
Your injured employee’s medical expenses will be paid for by workers compensation, and you’ll be reimbursed for some of their missed income while they’re recovering and off the job.
What does electrical contractor insurance cost?
Electrical Contractor Liability Insurance can start as little as $300 to $500 per year for a self-employed electrician who has no employees or subcontractors. This cost may increase for larger businesses that have workers’ compensation, auto insurance, and other coverage.
The majority of the time, the cost of electrician insurance (both Electrical Contractor Liability Insurance and workers compensation) is based on payroll, which means that insurance costs will increase as you add more employees to your workforce.