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What business insurance do contractors need in Texas?

Nov 19, 2020 · 4 minutes to read

About 700,000 people are working in construction in Texas, according to the Associated General Contractors of America. Construction has given people opportunities to earn a comfortable living with an average annual wage that’s 10% greater than the average in the state. Their determination, skill, and commitment to their work facilitate their success. So, if you’re running a contractors business, you must know how valuable each of your construction workers is.

While a construction business is lucrative, it can also  be risky. So what business insurance do contractors need in Texas to protect their employees and their business? This blog explains a few of the most common types of insurance and why you must consider getting them. Let’s dive right in!

What Types of Insurance Are Available for Contractors?

The purpose of business insurance for contractors is to protect the company and its employees. Accidents happen at construction sites. So, acquiring the right insurance policies for your company means that you’ll end up spending less money on the damages than otherwise. Take a look at some types of insurance you could get to keep your company safe.

General Liability Insurance

General liability (GL) insurance is one type of insurance that many contractors in Texas make sure to get. It protects your company from third-party claims for bodily damage, liability, and property damage that occurs when your business operates.

General liability insurance covers:

  • property damage caused to the public
  • injuries caused to the public

Consider this example: a client visits your office, and during their time there, they slip, fall, and injure themselves. Now, they can hold your office responsible for this injury. What this means for you is that your contractor business may have to cover their medical bills. They may also sue your company, resulting in a mountain of legal fees for youpotentially.

Well, how GL insurance helps you, in this case, is that it’ll cover both these expenses.

Workers’ Compensation Insurance

Workers’ compensation is a type of insurance that covers employees’ medical care if they get ill or injured. It may also cover the income they lose while they’re recovering.

So, workers’ compensation insurance in Texas covers

  • Medical bills for your employee that gets ill or injured at the workplace
  • Lost income for employees that are injured
  • Burial expenses if an employee dies because of a work-related injury

Is Workers’ Compensation Insurance a Requirement in Texas?

If you have a private business in Texas, workers’ compensation insurance is not a mandatory requirement. However, you’ll need to acquire workers’ comp for your employees if your contractor business works on a government entity’s project.

You can protect your company from lawsuits by any injured employees with workers’ compensation insurance. So, without workers’ comp, you may not have enough protection against various lawsuits, which can put your company at risk.

Contractor’s Tool and Equipment Insurance

Contractor’s tools and equipment insurance is the best way to avoid losing money on damaged, stolen, or misplaced equipment. This type of business insurance for contractors covers repairs and replacement for heavy equipment, power tools, and hand tools.

So, contractor’s tools and equipment insurance covers:

  • Small tools, such as wrenches, hammers, and saws
  • Mobile equipment

This type of insurance covers repair and replacement costs if someone vandalizes your equipment on site. Whether its backhoes, excavators, nail guns, drills, or jigsaws, you don’t need to spend money on getting replacements.

Professional Liability Insurance

Even the most skilled construction workers can make a mistake. Their negligence can result in property or financial damage to your client, which, in turn, can cost you a lot of money in lawsuits.

The good news is that you can keep your company safe in such situations with professional liability insurance. If, for example, your employee makes a mistake when installing the electrical system for a project, your client can hold your company accountable. As a result, there will most likely be a lot of time and money spent on dealing with the legal side of things. Well, professional liability insurance will cover those costs for you.

This type of business insurance for contractors covers:

  • Failure to meet agreed-upon deadlines
  • Oversights and errors when completing the project
  • Negligence in providing construction services

Professional liability insurance may seem like a costly investment; however, it can protect your company in the long term.

Commercial Auto Insurance

Commercial auto insurance policy covers repair costs for company-owned vehicles and employee medical bills if there’s an accident.

Last Few Words

The insurance policies above are not mandatory for contracting companies to hold. However, they can protect you and your business from a lot of potential risks. Find insurance policies suitable for your contracting business!

Let's find

The coverage you need for your business

Professional Liability Insurance

Professional Liability Insurance

Get a quote

General Liability Insurance

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Business Owner’s Policy (BOP)

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Workers Compensation Insurance

Workers Compensation Insurance

Get a quote

Let's find

The coverage you need for your business

Professional Liability Insurance

Professional Liability Insurance

Get a quote

General Liability Insurance

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Business Owner’s Policy (BOP)

Get a quote

Workers Compensation Insurance

Workers Compensation Insurance

Get a quote

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