When entering the world of contractual services, it’s imperative to get contractor general liability insurance that matches your business risks. Working on reducing these risks can help lower your insurance rates. Here are important points to know about general liability insurance for contractors.
How Much Does a General Liability Policy for Contractors Cost in California?
The cost of contractor general liability insurance in California depends on various factors such as classification, location, payroll, and other expenses. Your credit score also comes into play, as well as deductibles, fees, and taxes.
Additionally, you have the power to adjust your policy’s coverage limits, which directly impacts your premium. Ultimately, the annual cost for the common California contractor ranges from about $800 to over $1,200.
Why Does a Contractor Need General Liability Insurance?
It’s crucial for contractors and subcontractors to carry contractor general liability insurance to protect against lawsuits. No matter how well a company manages to maintain a positive public image, accidents can happen. You need to be prepared financially in the event of a misfortune that disrupts your business.
Established contractors who are looking to hire subcontractors typically require liability policies with aggregate coverage of up to $2 million. Without this level of coverage, subcontractors will be shut out of many lucrative opportunities.
What Does a Contractor’s General Liability Policy Cover?
Here are the five areas of coverage to consider:
- Bodily injury or death – The coverage pays for injury, illness, or death of a third-party victim resulting from a company accident.
- Property damage – Pays to repair or replace physical damages.
- Product and completed operations – Pays for bodily injury claims after work is completed during the policy period.
- Medical bills – This coverage pays medical bills up to coverage limits during the policy period.
- Personal and advertising injury – Contractors may get sued for copyright infringement for the content they use in advertising, but this coverage pays the legal bills.
What Other Types of Coverages Are Required of Contractors in California?
California requires all licensed contractors to invest in a $25,000 contractor license bond. Some contractors will need to put down higher amounts, depending on the structure of the company.
Customize Your Liability Insurance Today with CDF Artisan Insurance
Every contractor must assess their insurance needs and find the most efficient solution. CDF-Artisan Insurance Solutions helps construction business owners secure the right general liability insurance based on how they run their operations. Contact us today to secure the right liability coverage for your business.