Do you run your own business? And do you take on jobs that involve physical labor? Then you’re a contractor by default.
As professionals, it is wise to insure their business so that everyone can carry out their work without worries. But what exactly is contractor insurance and what do you pay when you get one?
Read on to find out how much the contractor insurance cost is.
General Liability Insurance
General liability insurance covers any third-party claims for bodily injury, property damage, or personal injury that may arise from your work. The cost of general liability insurance can vary depending on the size and nature of your business, but it typically starts at around $500 per year.
However, for larger businesses with more risks and higher revenue, the cost can be significantly higher. It is important to carefully assess the risks associated with your business and choose a comprehensive insurance policy that provides adequate coverage at a reasonable price.
Workers’ Compensation Insurance
Among the most important types of insurance for contractors is workers’ compensation, as it provides coverage for work-related injuries or illnesses suffered by employees. The cost of workers’ compensation insurance is usually calculated based on the contractor’s payroll and the level of risk associated with the types of work being performed. On average, it can cost between $700 to $3,000 per year per employee.
This means that contractors can expect to pay a higher premium if they have a higher payroll or engage in more hazardous work. However, the peace of mind and protection that this insurance provides for both the business and its employees is well worth the cost.
Commercial Auto Insurance
As a contractor, it is essential to have insurance coverage for your business, especially if you have a fleet of vehicles. The cost of contractor insurance varies depending on the number and type of vehicles in your possession. It also depends on their usage.
On average, the cost of commercial auto insurance for a contracting business with a fleet of vehicles can range from $700 to $2700. The exact amount you will pay will also depend on factors such as the driving records of your employees. It also depends on the type of work your business is engaged in.
However, having insurance coverage for your vehicles is crucial. This helps in protecting your business from potential financial losses in the event of construction site accidents or damages.
Professional Liability Insurance
When it comes to protecting your business as a contractor, professional liability insurance, specifically errors and omissions insurance, is crucial. This coverage is designed to safeguard against claims of professional services:
The cost of contractor insurance varies greatly, depending on the industry you work. It also depends on the size of your business. Factors that can also impact are:
- the type of work you do
- your revenue
- your claims history
Costs vary based on your industry and coverage limits but can range from $700 to $1000 or more per year. Ultimately, investing in this insurance through an insurance agency based in Lancaster, PA., for example, is essential for contractors to protect themselves and their businesses from potentially costly liability claims.
Understand the Contractor Insurance Cost
When considering contractor insurance, it is important to understand the various factors that can impact the contractor insurance cost, such as the type of coverage needed, the size of the company, and the level of risk involved in the industry. By researching and comparing quotes from reputable insurance providers, you can find the best coverage at a reasonable price.
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