Demolition contractors are involved in the wrecking of buildings or structures, including exterior and interior demolition (or the stripping out of buildings and structures). Demolition contractor activities might also include excavation, grading of land, and recycling of construction debris.
Having the right demolition contractor insurance protects your business from catastrophic litigation costs after an accident and a large claim. A comprehensive business insurance program designed for demolition contractors protects you from employee errors, public injuries, property damage, pollution claims, and more.
A local independent insurance agent can help you get the tailored demolition contractor insurance you need.
Why Do You Need Demolition Contractor Insurance?
Demolition contractors dismantle buildings, structures, machinery, or equipment. The exact process used to carry out a demolition depends on the type of structure and a variety of other factors. Interior demolition is often performed with only hand tools, while large demolition projects can involve heavy machinery, wrecking balls swinging from a crane, and even explosives.
Following a demolition, a demolition contractor may engage in sorting and recycling of materials.
Demolition contractors are exposed to dangerous conditions where an employee or a third party can be injured. You could make a mistake and damage a nearby building, or your own machinery or property can be damaged. Improper disposal of asbestos or other pollutants can contaminate the demolition zone or the nearby area.
All of these incidents would likely be followed by serious financial repercussions as you pay for property damage, medical expenses, and even legal expenses if you’re sued (which is likely). A major lawsuit can lead to no less than bankruptcy for your business.
If you own a demolition business, you must safeguard your business from the unique risks you face by investing in comprehensive, tailored, demolition contractors insurance.
What Does Demolition Contractor Liability Insurance cover?
Demolition contractor insurance is not one insurance policy, but several policies designed around the unique risks you face. The most important type of coverage you need is general liability insurance.
Commercial general liability (CGL) insurance offers broad coverage for third-party injuries and property damage (injuries or property damage that occur on your premises or as a result of your operations).
CGL insurance can, for example, protect you if people are injured by explosives stored on your premises, or if a blast goes wrong and injures onlookers at a demolition site. Improperly stored explosives or errors during blasting can also damage nearby property. In both cases, you’d be responsible for paying for medical bills and property damage for anyone who was affected. The likelihood that you’d be sued is very high as well.
CGL insurance covers direct expenses for injury and property damage claims, and it also covers your legal fees and financial settlements or judgments if you’re sued.
CGL insurance is simply a requirement of doing business for demolition contractors. Without it, finding and securing customers and jobs would likely be impossible.
What Other Insurance Policies to Demolition Contractors Need?
Demolition contractors need a variety of other insurance policies to cover all of their unique risks.
- Workers' compensation insurance: This protects your employees if they are injured on the job, or if they develop a work-related illness. If, for example, an employee suffers hearing loss or another injury after a blast, workers’ compensation insurance will help pay for the medical care that he or she needs, as well as any income that the employee loses if he or she cannot immediately return to work after the injury.
- Equipment physical damage coverage: The heavy equipment that you use in your demolition jobs is expensive, and if a crane or some other type of equipment is damaged, it costs a lot to repair or replace it. Equipment physical damage coverage covers the value of the equipment when it is damaged.
- Environmental liability insurance: Asbestos and other pollutants can be present in the buildings you demolish and can impact the air and ground water near a demolition site. The storage, use, and disposal of explosives are also problematic, as is the release of smoke, dust, methane, and other toxins after a blast. Environmental liability insurance covers a variety of pollution exposures that you face.
- Excess liability insurance: Financial payouts for lawsuits often reach well over the $1 million limit on a typical CGL policy. Most of your customers will require you to have more coverage than that, or excess liability coverage in the form of a commercial umbrella policy. Commercial umbrella insurance provides liability limits above and beyond certain other liability policies (CGL, commercial auto) at a more affordable cost than increasing the limits of several individual policies.
- Commercial property insurance: This covers your buildings, workspaces, and all kinds of commercial property including equipment, tools, office furniture, computers, and more if they’re damaged or destroyed by fire, smoke, theft, vandalism, or a weather event.
- Business interruption insurance: This reimburses you for lost income and helps pay for certain ongoing expenses if you are temporarily unable to operate due to a covered loss (fire, weather, vandalism, etc.).
- Inland marine insurance: This protects your equipment, tools, portable computer equipment, and other supplies from theft, loss, or damage while they are in transit to and from worksites.
What Are Contractors Bonds and Do You Need them?
You might need a variety of contractors bonds, or surety bonds, depending on the size and scope of the projects that you work on. Bonds are very important for contractors who work on commercial building sites. And you may be required to have certain kinds of bonds in order to secure the required licensing that you need.
Contractors bonds can be essential for finding, securing, and performing work. They are typically used to guarantee some aspect of the bidding process or building project and ensure the project owner that you are fully licensed, insured, and prepared to complete the project as promised.
Every type of bond is unique and tailored to a specific project. While you may not need them for every job, it’s likely that you’ll need various types of contractors bonds for most of the jobs that you do.
How Much Does Demolition Contractor Insurance Cost?
Demolition contractor insurance costs will vary depending on the size of your business, the number of employees you have, and how much business property (buildings, tools, and equipment) you have.
Insuring your demolition contractor business is complex. The types of coverage you need and can qualify for depends on several variables. You may need to find coverage through a specialty insurer who specializes in businesses like yours.
An independent agent who has experience working with demolition contractors can help you decide the types and amounts of coverage you need for your business. The choices you make will determine your cost of coverage.
Find and Compare Quotes
An independent agent can work with you one-on-one to determine the types and amounts of coverage you need. Your agent can get quotes from multiple insurance companies so you can evaluate the cost and coverage options and make the best choice.
Benefits of an Independent Agent
Our agents simplify the search process for finding the right demolition contractor insurance. They’ll walk you through the handpicked policy options and explain the details.
Most importantly, they’ll be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.
The Lowdown on Online Quotes
Online quotes can be tempting. They are fast and easy to get — but are they accurate? And are you getting quotes for the right coverage? For business owners, choosing speed over accuracy can cost you.
Online quotes can’t and don’t see the whole picture. They can omit important coverage that will leave you devastated if something unexpected happens. And they can leave out cost-saving opportunities that an agent can help you take advantage of.
Instead of getting an online quote, find an independent agent now, and get one-on-one consultation and affordable options for the best coverage for your needs.
TrustedChoice.com Article | Reviewed by Paul Martin
©2020, Consumer Agent Portal, LLC. All rights reserved.