Log home builders construct new log homes using artisan quality workmanship combined with architectural and engineering expertise. As a log home builder, you play a very special role in building homes for the lives of many people.
Unfortunately, a lot of problems occur on construction sites every day. The best thing you can do to protect your business and your customers is to have the right business insurance in place to make sure you can recover your losses, regroup, and complete a building project even after a disaster.
A local independent insurance agent can help you get the log home builders insurance you need to protect your business for the long term.
Why Do You Need Log Home Builders Insurance?
Log home “for-sale” builders specifically build new log homes on land that they own, with the finished home and land to be sold upon completion. Most log home builders, whether they build homes for individual customers or they build large numbers of for-sale log homes, need similar types of insurance to cover potential losses.
What varies among different types of log home builders is the number of structures that are covered; the number of subcontractors on the job at any one time; the amount of tools, equipment, and materials owned by the contractor and dispersed at jobsites; the number of employees; and the number of contracts that must be satisfied in order for a project to be completed.
While the specifics of the insurance coverage you need might vary depending on the type of projects that you undertake and their size and scope, log home builders like you need to consider:
- What if a fire or storm destroys an unfinished house?
- What if someone gets injured on the jobsite?
- What if your tools or building materials are stolen from the worksite or destroyed in a severe storm?
Log home builders take on huge risks at jobsites, working with other contractors and subcontractors, using and storing valuable tools, equipment, and building materials onsite, and moving them from place to place.
On any given day, a new housing contractor might experience:
- Property theft, vandalism, loss, or damage at your home office or on a job site
- Lost income due to work stoppages after a fire, storm, or power outage
- Employee illness, injury, or death
- Liability claims if you cause bodily injury or property damage to others at your home office, showroom, or at a jobsite
Aside from these immediate risks, log home builders can be held legally responsible for problems that happen long after a house is complete. Leaky roofs, mold problems, structural defects, and faulty walls or foundations are all common problems that may only become apparent months or even years after a log home is completed.
What’s worse, if one house has a problem, it’s likely that others built with the same materials or with the same building methods have the same problem. Your log home builders insurance gives you a place to turn when repairs have to be made, and in the worst case, when lawsuits are filed.
And keep in mind that in order to obtain a contractors license and even begin work as a builder, you will be required to prove that you have appropriate and adequate insurance coverage. So while insurance is necessary to protect your livelihood, it is also simply a requirement of doing business.
Liability Insurance for Log Home Builders
Liability insurance is your first line of defense for lawsuits and claims for property damage or bodily injury that you have caused.
- Contractors general liability insurance protects you if your business is responsible for bodily injury or property damage to others. Be mindful that most construction firms, including log home builders, need general liability insurance in order to obtain a contractor’s license.
General liability insurance provides coverage for a variety of liability claims, such as:
- Bodily injury
- Property damage
- Completed products/operations
- Personal injury and advertising injury
You'll also need several other types of liability insurance, including the following:
- If you own trucks or other vehicles, commercial auto insurance covers your owned vehicles and drivers in the event of an accident or other vehicle damage that occurs. Commercial auto insurance provides coverage for property damage and bodily injury liability claims, vehicle damage, and medical bills, as well as any costs related to lawsuits due to auto accidents involving your vehicles.
- Professional liability insurance: This is also known as contractors errors and omissions insurance. It covers you if a client experiences a loss based upon any professional services you have provided, such as design work or advice.
You may want to talk to your independent insurance agent about your need for excess liability, or commercial umbrella insurance.
- Commercial umbrella insurance: This provides an extra layer of liability protection to any of several other liability policies you might have. Commercial umbrella insurance kicks in when the limits of your other applicable insurance policies have been exhausted, protecting you in the event that a claim exceeds the amount of coverage available from any other applicable policy.
Property Insurance for Log Home Builders
Commercial property insurance: This helps you protect losses to your physical assets, such as tools, equipment, construction materials, office space and furnishings, computers, etc., whether they are in an office or a warehouse, a showroom, on a jobsite, or in transit from one site to another.
With a variety of policies and endorsements, you can cover your “stuff” no matter where it is.
- Commercial property insurance covers your office space, warehouse, or other buildings and their contents for losses due to fire, theft, vandalism, weather events, and more.
- Property insurance also typically includes loss of income coverage, or business interruption insurance. It 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, storm, etc.).
Your commercial property policy only covers your tools, equipment, and supplies while they are on your premises (at your office, a warehouse, showroom, or other covered location). You need additional coverage to protect all of your property while it is in transit and while it is at a jobsite.
- Inland marine insurance: This is another form of property insurance that protects your equipment, tools, portable computer equipment, building supplies, and any other tools or equipment from theft, loss, or damage while they are in transit to and from worksites.
The Importance of Builders Risk Insurance for Log Home Builders
Log home builders face unique risks. You have numerous log homes under construction at one time in varying states of completion. Some may be only a foundation or a frame, while others may be ready for the final interior finishing touches.
At each jobsite you have tools, equipment, building materials, and the structure itself to worry about. What happens if there’s a fire or storm that destroys the structure? What if thieves break into your construction trailer and steal valuable tools, equipment, or materials? How would you pay for the losses and complete the house?
Builders risk insurance: This is the answer and here are the basics:
- A type of property insurance that helps construction professionals protect their investment and their bottom line
- Protects buildings that are under construction, as well as materials and equipment at the jobsite
- Usually covers the total completed value of the structure, including materials and labor, but not the value of the land
- Typically covers damage due to fire, wind, theft, lighting, hail, explosion, vandalism, and certain other perils
- Does not cover worker accidents and injuries or liability risks (these are covered by your other policies)
You can structure your policy to cover your unique project and the related exposures. It is important to note that your builders risk insurance policy will not cover property on the jobsite that belongs to others, and subcontractors are usually required to have their own insurance.
Why Do Log Home Builders Need Workers’ Compensation Insurance?
Any kind of construction environment can be dangerous for employees. No matter how many safety protocols you have in place, accidents happen.
Construction workers may use heat and welding tools, saws, hammers, heavy machinery, and sharp instruments. Their fingers, toes, eyes, and limbs can be damaged, cut, or crushed. Workers can fall from unfinished second stories or from roofs.
Even employees who work with simple hand tools can be vulnerable to repetitive motion injuries and other problems. What’s more, insulation, wood particles, lacquers, paints, and other chemicals can cause eye and lung irritation, or worse.
Keeping your employees safe from work-related injuries is important for their health and satisfaction, as well as your long-term financial survival. Workers' compensation insurance provides insurance coverage for employees when accidents happen at the workplace, regardless of who is at fault. The injured worker receives medical care and income protection after a work-related injury.
Each state has different workers’ compensation laws. Your independent insurance agent can help you navigate the rules for your state, and can help you find appropriate workers’ compensation insurance.
How Much Does Log Home Builders Insurance Cost?
Insurance costs for log home builders will vary significantly form builder to builder. Your costs may increase and decrease over time as the number of log homes under construction fluctuates.
Insurance company underwriters will consider things like the location and types of homes you are building, the number of log homes under construction, and all of the different optional coverage types and policies that you might need. Your costs are based on these and a variety of other factors unique to your business.
Your best bet is to work with an agent who specializes in log home builders insurance. An experienced independent agent will have access to insurance companies who have developed policies specifically for your type of business and the risks you face. And an experienced agent will be able to anticipate your exposures and find the right insurance products to protect your livelihood for the long-term.
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 log home builders 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 unique needs.
TrustedChoice.com Article | Reviewed by Paul Martin
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