The excavation contractor industry works primarily in excavation, grading and demolition to prepare sites for new building construction. Jobs that fall under this umbrella include blasting, building demolition, foundation digging, concrete breaking and cutting for demolition, foundation drilling, dirt moving, and land clearing. If you are an independent excavation contractor or own a business that does this type of work, you will want to be sure to protect your business’s financial interests with a suitable excavation insurance portfolio.
2014 Excavation Contractors Industry Facts From IBISWorld
- There are currently more than 24,000 excavation contractor businesses operating in the U.S.
- These excavation businesses employ approximately 386,000 people.
- The excavation contractor industry generates about $56 billion in revenue each year.
Your Excavator Insurance Portfolio Needs Sufficient Liability Coverage
Disasters caused by accidents at excavation job sites can be quite costly. It is therefore very important that your business be covered by the right liability insurance policies. Some liability insurance types you will want to discuss with your independent insurance agent include the following:
- Commercial general liability insurance (CGL): This covers you against most instances of property damage or third-party injuries caused by your employees while on the job. As with any insurance policy, there may be exclusions, such as subsidence damage or demolition damage. Be sure to discuss these concerns with your insurance agent. It is likely that the general contractor who hired you to do excavation work will require that you have them named as an additional insured on your CGL for the duration of the job. In the same manner, if you hire subcontractors to work under you, you should require them to add you to their coverage. That way, coverage is complete all the way up the line of responsibility.
- Commercial auto liability coverage: Excavators typically have a large fleet of heavy machinery vehicles, such as dump trucks, backhoes and 18-wheelers, to transport machinery to and from the job site. These vehicles need to be covered with a commercial auto insurance policy. Because these trucks are typically very large and heavy, they can cause a great deal of damage in the event of an accident, so the policies to cover them have higher liability limits than typical auto insurance policies.
- Employment practices liability coverage: You may want to consider adding this coverage to your excavation contractor insurance portfolio. It protects your business if a current or former employee sues for a perceived illegal business practice, such as wrongful termination or discrimination.
- Umbrella insurance coverage: Because accidents at excavation or demolition job sites can cause very expensive property damage or serious injuries to many people, your regular policy coverage limits may be too low to fully protect your business. Umbrella insurance enables you to buy extra liability insurance coverage for all of your policies that include liability coverage so that your business finances are suitably protected.
There Are Special Considerations for Demolition Contractor Insurance
If your excavation contracting firm includes demolition as one of its services, safety factors will play a big role in your insurance coverage. Demolition creates numerous exposures for your business, as there is an increased risk of injuries and property damage to the public.
In many cases, injuries and property damage caused by demolition jobs may be specifically excluded by the insurance company on a standard general liability policy. However, some insurance companies may be willing to include demolition insurance coverage provided that the insured agrees to meet certain terms and conditions related to safety protocols.
If you need demolition insurance, your independent insurance agent can help you find insurance companies that are willing to provide it. Bear in mind, however, that safety is paramount, and failure to meet the safety protocols and conditions set forth by the insurance company can cause you to forfeit your coverage in the event of a tragic accident. Your insurance agent can provide you with more information about demolition contractor insurance.
Be Sure Your Excavator Insurance Portfolio Includes Workers' Compensation
Another type of excavation insurance coverage that hiring contractors are likely to require of you is workers' compensation insurance. While this coverage is already mandated for employers in most states, you may need to provide proof of this coverage to the general contractor before your crew can start working at the job site.
The hiring contractor may also require to obtain a waiver of subrogation with your workers' compensation insurance, which provides them with a measure of coverage as well. Your insurance agent can help you obtain this waiver.
Workers' compensation is particularly important in the excavation contractor industry, where the work is dangerous and injuries on the job can be severe. It can cover the treatment of workplace injuries, lost wages and even pay a death benefit to surviving family members if an injury is fatal. An independent insurance agent can help you find an insurance provider who specializes in covering injuries at excavation work sites. That way, your insurance company can serve as a helpful resource when it comes to protecting your workers through safety protocols.
Your Excavation Insurance Should Include the Right Property Coverage
When you are working at an excavation job site, you will have lots of machinery, tools and other business property that you will want to insure against damage and theft. Fortunately, if you are doing excavation work in preparation for a new building construction, the top contractor will have most likely purchased a builders risk insurance policy. This policy covers all property on the job site, including in most cases the property owned by your business, for the duration of the contract.
You can also acquire coverage for your tools, machinery and business property through an inland marine insurance policy. These policies offer a number of different coverage types. Your independent insurance agent can help you purchase a policy that will cover your business property while on job sites and while in transit to and from jobs.
You may also want to talk to your agent about adding extra expense insurance to your excavation insurance portfolio. This coverage can be useful if your business has a centralized office location and the office is damaged by a covered event. Extra expense insurance covers the cost of renting temporary office space until you can move back into your regular location.
Get Help Building a Strong Excavator Insurance Portfolio
Building a comprehensive excavation contractor insurance portfolio can be a complex process. Not only will you want to be sure that you have all the different types of coverage you need, you must be sure that your coverage limits are high enough to sufficiently protect your business from large financial losses. An independent agent in the Trusted Choice network can help. Agents who are experienced with excavation and demolition contractor insurance can explain your many coverage options and can recommend suitable policies to cover your various exposures. Because they are free to shop around, you can be sure that you are getting your coverage at a competitive rate. Find a Trusted Choice agent near you to learn more so you can soon start building a comprehensive excavation insurance portfolio.