The contracting business is very diverse itself. It always involves working with tools and hardware, as well as in dangerous locations. Hence, the insurance that is required to handle injuries, medical expenses, and other incidents is extensive.
In the city of Chicago, there aren’t stringent requirements set by law for every type of contracting business. However, there are several types of insurance that you should get if you have a contracting business. They would benefit you and your business significantly since medical and legal expenses and liabilities are inevitabilities in these types of businesses.
What Insurances Do Contractors Need in Illinois?
General Liability Insurance
While you’re not forced by law to get general liability insurance, it’s important that you do. It covers most types of injuries that can occur to the public. It covers injuries for any third party that visit your site or your office.
Furthermore, third party medical bills, attorney fees, and court ordered judgments, or out-of-court settlements are also covered by general liability insurance.
Worker’s Compensation Insurance
This is the only mandatory insurance for contractor businesses in Chicago. If you’re running a business in the State of Illinois with employees, you are legally required to get worker’s compensation.
Worker’s compensation insurance protects the business owners from various lawsuits, medical bills, etc.
Worker’s compensation not only helps to cover medical bills for injures, but it also covers lost wages. The latter tend to occur when serious injuries befall certain employees and they’re unable to work. It’s your duty as an employer to keep paying them during this tough time. Worker’s compensation covers that.
Also, businesses that have worker’s compensation also benefit from the coverage of legal fees. They can hire lawyers and pay for court costs. Employers can also cover burial costs for deceased employees in the case of a tragedy. Also, the worker’s compensation insurance covers the victim’s family for the potential lost income as a result of the death.
Tools and Equipment Insurance
The tools that you use during construction or contracting jobs are extremely valuable to the company. They can cost hundreds, perhaps thousands of dollars per unit. Hence, they also need to be ensured. The loss of certain equipment can halt work on a certain part of the project or on the entire project in some cases. Insurance for contractor businesses should cover those tools without a doubt.
Hence any tools currently in use to construct or to carry out repairs are insured through tools and equipment insurance. These tools can include nail guns, drills, saws, jackhammers, or even small toolboxes.
Tool box theft, mobile equipment damage, etc. is also covered by tools and equipment insurance. The cut off is equipment that is more than five years old. Hence, any equipment that is newer than five years, hence less likely to break or get damaged, is covered. Anything older than that is considered worn out and not worth reimbursing the company for.
Professional Liability Insurance
As a contracting business, you’re expected to employ workers with a certain level of expertise. Since they’re repairing, constructing, installing new equipment, diagnosing structural faults, etc. they should be qualified. However, no matter how qualified someone is, human error spares no one.
If a client suffers financially or physically because of errors or omissions made by your or your employees, they can sue. Professional liability insurance exists so that costs emerging from charges of negligence and error are taken care of. The policy covers failure to deliver on promised services, errors, negligence, and oversight.
These insurance policies not only protect the handiwork that your contracting business produces, but your company itself. It allows your company to protect your clients and your customers as well as keep your company in good shape.
While not required by law to get several of these insurances, you should still consider getting them all.