5 Contractor Insurance Mistakes to Avoid
New contractors make costly insurance mistakes. Learn the top 5 errors to avoid, from skipping workers comp to buying minimum limits.
5 Contractor Insurance Mistakes to Avoid
New contractors make costly insurance mistakes. Learn the top 5 errors to avoid, from skipping workers comp to buying minimum limits.
In this article, Todd Conn, CLCS, founder of TCDS Insurance Agency, shares his insights on 5 Contractor Insurance Mistakes to Avoid. As a 2023 Agency of the Year recipient with a 4.9-star rating, TCDS is committed to educating consumers on making informed insurance decisions.
Ready to see how much you can save? Contact TCDS Insurance Agency today for a free, no-obligation quote. Our local agents are ready to help you find the perfect insurance plan for your needs and budget. Let us do the shopping for you!
What is the biggest insurance mistake contractors make?
The most common mistake is carrying only minimum general liability coverage without considering the full scope of their risk. Many contractors underestimate their exposure and end up with coverage gaps that leave them personally liable for claims that exceed their policy limits.
Do subcontractors need their own insurance?
Yes, subcontractors should always carry their own insurance. Relying on a general contractor's policy is risky because it may not cover subcontractor-specific work, and claims can affect the GC's policy rather than providing direct protection for the subcontractor.
What insurance do Alabama contractors need?
Alabama contractors typically need general liability, workers compensation (required with 5+ employees), commercial auto, tools and equipment coverage, and often an umbrella policy. Specialized contractors may also need professional liability or pollution liability coverage.
How can contractors avoid insurance coverage gaps?
Work with an independent agent who specializes in contractor insurance. Review your policy annually, ensure your coverage limits match your contract requirements, verify all subcontractors carry adequate insurance, and update your policy whenever you take on new types of work.