The purpose of Contractor General Liability Insurance is to mitigate your financial risk. However, Coronavirus has highlighted risks that you may not have taken into account. The pandemic is unprecedented, bringing with it a realization of how vulnerable our businesses are.
So, what can you do differently to protect your contractor business?
Get the right insurance policies
No one insurance policy covers all risks. For instance, Contractor General Liability Insurance does not offer coverage for property replacement when the structure you are building is damaged or vandalized. On the other hand, Builder’s Risk Insurance does not cover third-party litigation for bodily injury damages. A third example is Workers Compensation, which only covers employees and not third-party bodily injury or property damage.
Customize your insurance coverage
You should have the right policies. Your insurance company should also customize them for the particular conditions and risks faced by your company. A typical example is the differences between a roofer’s risks and a plumber’s. Your policies will include exclusions that are relevant to your risks.
For example, your Contractor General Liability Insurance may require additional Errors and Omissions coverage. This is important if your business model includes advising clients.
Insure for the right amount of coverage
Are you under-insured? One of the hardest lessons is discovering that your business is underinsured. For instance, you may face a claim for property damage. You believe that you have ample Contractor General Liability Insurance coverage only to discover that you are underinsured. The worst-case scenario is that the insurance company voids your policy, and you find yourself with zero coverage.
Assess your insurance regularly
A contractor’s scope of business can change dramatically, which means that your exclusions and the value of your coverage will have to be adjusted to accommodate this. We advise that you assess your coverage annually, at least. Your company may have grown, or you may be taking on bigger projects. Both of these conditions will impact your insurance.
Keep up with industry trends and developments
Another thing that Coronavirus is teaching contractors is how necessary it is to keep up with industry trends and developments. There has been significant disruption to the construction industry due to stay at home orders, breaks in the supply chain, and rising prices of building materials. Only the most resilient contractors will survive.
Contractors who move with the industry and embrace new building technologies are likely to be more competitive, and so weather the storm.
Have you have outfitted your employees with wearable sensors that reduce safety issues, or do you use smart project management tools, or are you providing quicker and better quality work with prefabricated and modular construction?
Apply big lessons to your Contractor General Liability Insurance
If there is one thing Coronavirus has taught us all, it is to prepare for the unforeseen.
Firstly, stay ahead by embracing industry trends and developments. This makes your company less vulnerable because you already have cost-saving processes in place when the market takes a dip.
Secondly, keep your coverage up-to-date. Get advice and guidance from experts that specialize in contractor general liability insurance. This way, you will have coverage for construction dangers you may not have considered.