subject: Insurance For Contractors What Exactly Do You Need? [print this page] Insurance For Contractors What Exactly Do You Need?
Plethoras of contractors learn and gain knowledge of their trade while working with or for an experienced contractor or a trade school. When finished, they are ready to dip their toes into the vast sea that is called real life and the real world. With the investment that the teacher and/or boss placed in the student/employee now turned full-fledged contractor, there may have not been on-the-job site training and at times the contractor is like a baby bird that is pushed out of the nest and is not exactly ready to fly despite the wings that it was born with. Eventually, the contractor will have to learn to fly and can soar with the proper coverage in order venture out and solicit business. This is where the task of finding a proper insurance agency in New York comes in and like many, a contractor will need more than one for the interests of potential customers and for himself/herself.
The most prominent and ubiquitous insurance that is widely utilized is General Liability. General Liability covers the company's assets against financial loss caused by third-party claims of property damage, bodily injury, personal injury, or even negligence. General liability insurance can be purchased into a (BOP). A BOP blends property and liability in one, although the liability coverage portion will be limited. Contractors or businesses that require coverage can generally purchase liability insurance separately. The amount of coverage that a business would requires two factors, perceived risk and the amount at which is operated, contractors, if they are business owners, need to determine the risks that are associated with their business so that they can avoid lawsuits. Businesses that operate in New York that award high damage amounts to plaintiffs typically need more coverage.
General Liability insurance is mandatory to each contractor and depending upon the individual business, it is best to consult an insurance provider who can offer sound advice and guidance that will result in good coverage. Generally, the recommended minimum coverage would be at least $2 million. Many insurance companies require their policyholders and employees to report any activity that could lead to a liability as soon as possible. The insurer would then require proof of the situation, document it, and forward it so that an investigation could occur.
Workers Compensation provides insurance coverage for employees injured on the work site. New York State requires business with payroll employees to carry Workers Compensation. It is necessary to protect the business, employees and clients wherein there is an accident or injury on the job. Workers Compensation usually covers medical costs, economic losses, wage replacement and in the event there is a loss of life, dependents can receive settlement payments. Like General Liability insurance, policyholders must require proof of any activity that could be liability and also be aware of the guidelines of their policy.
Disability insurance offers coverage to employees injured off of the work site, but most of the time it is short term. It occurs when the employee is unable to work due to illness, injury, or childbirth. Every and any insurance company in New York requires that employees be covered for twenty-six days, although disability can range from a minimal few days to a year.
Bond insurance guarantees assurances to the client regarding the conclusion of business together. It is not an insurance policy unto itself but rather a municipal form of credit issued by a holder or "insurance" to a principal or contractor. Bonds are mostly a form of credit where if a client or employee make a claim, the boss/contractor will be responsible for the full amount of the bond that was issued.
These insurances are the most paramount coverage that a contractor can extend to his/her employees and clients. The fledgling contractor can become a boss of small or large business and offer his/her services to the best of his ability. Like the proverbial baby bird that fell out of the nest, it can grow up and soar.
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