Texas Contractors Insurance
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Business Insurance for Contractors in Texas
When it comes to insuring yourself and your business as a contractor, you may be required to hold multiple types of business insurance. You may need general contractors’ insurance if you have a physical location with a commercial lease. Businesses that own a vehicle are required by state law to hold commercial auto insurance.
In Texas, contractors insurance is required for professionals in many fields, including:
- Concrete Contractors
- General Contractors
Whether you are a contractor or a subcontractor, it’s important that you carry your own insurance. As a subcontractor, make sure you aren’t counting on the main contractor’s policy to extend coverage for you as well. If your name isn’t on the policy, you shouldn’t rely on it. There are a few types of insurance that every subcontractor should have, including:
- Contractor’s Error & Omissions
- Excess Liability
- Property/Contractors Equipment
- Commercial Auto
- General Liability
- Worker’s Compensation
In order to prove that you’ve got the appropriate types of insurance, you’ll need a certificate of insurance or COI. Contractors and subcontractors that can show this certificate to potential clients are more likely to win a bid than those that don’t have one. A COI shows the policyholder’s name, type of coverage, policy limits which are often 1M or 2M, effective date, and any other relevant information.
Each type of insurance covers specific situations, so most contractors hold multiple types of coverage. There are 7 main ones that are worth having if you want to ensure that you and your business are covered for anything that can pop up.
Texas Contractors General Liability Insurance
The most basic level of contractor’s insurance is general liability insurance. The state of Texas requires many different professionals to hold this type of insurance.
One of the concerns that contractors have is that someone on the job site could be injured. Accidents do happen which is why insurance is so important. Injuries to an employee are covered under workers’ compensation, but bodily injuries that you cause to clients and other non-employees are covered under general liability insurance.
Completed operations insurance provides protection for you if an injury or property damage happens following the completion of the job. An example would be if you built a deck a year ago and people were injured due to the deck collapsing.
Texas General Liability Insurance Coverage Includes:
- False advertising
- Property damage you cause at a job site
Texas Worker’s Compensation Insurance
It’s no secret that the construction industry is a very demanding field with intense physical labor. Between working in high places, lifting heavy objects, and working around heavy machinery, even the most experienced construction workers are at risk of serious injury on the job.
When one of your workers is injured badly enough that it keeps them out of work and leads to extended medical care, not only is that employee missing out on the wages for the shifts they’re missing, their medical debt gets deeper and deeper. This is where workers’ compensation comes in.
With workers’ compensation or workman’s compensation, your employee will be able to claim their injuries and get compensated for many things, including lost wages, previous medical bills caused by the injury, and future medical care. With this type of insurance, you know your employees should be able to survive being out of work while recovering.
Texas Commercial Auto Insurance
This business insurance policy covers any vehicles that are used or owned by your business. It provides protection to your business against any accident-related damages.
This type of insurance covers:
- Collision or comprehensive physical damage to your vehicles
- Damage caused to others by your insured vehicles
- Damages sustained by your vehicle’s occupants that were caused by an uninsured motorist’s negligence
- Liability damage
- Physical damage to any vehicle owns, uses, or leases
Commercial auto insurance can include two types of physical damage; comprehensive loss or collision loss. Collision loss covers any automobile accident damage while comprehensive losses are damage from theft, weather, and any other cause that is not a collision.
In addition to the coverage of physical damage, it includes two types of liability coverage. Property damage coverage includes damage t someone else’s property following an accident that was your fault. Bodily injury coverage is for injuries that happened during an accident in which you were at fault.
Texas Builder’s Risk Insurance
This specialized type of insurance covers construction that is currently in progress. Builder’s risk insurance in Texas is an essential type of coverage that ensures a building under construction is protected from property damage caused by: Lightning, Explosions, Fire, Hail, Vandalism, Theft, and Acts of God (major weather events, etc.).
Builder’s risk isn’t simply just for the contractor. Anyone with a financial stake in the construction project should be included in the policy. This includes the property owner, lender, architects, general contractor, and subcontractors. Outside of property damage, this Texas Builder’s Risk insurance covers other expenses aside from the construction itself. Some of these costs include:
- Additional interest on loans
- Lost sales
- Rental income
- Real estate taxes
Additionally, your policy can be customized to include coverage extensions which can protect construction forms, scaffolding, and debris removal and disposal following a loss.
Texas Inland Marine Insurance
As a contractor, you should carry inland marine insurance in Houston. While the name may be deceiving, this type of insurance doesn’t have anything to do with water or boats. Inland marine insurance covers materials, equipment, and products that are transported over land via truck or train, as well as anything temporarily housed by a third party.
Houston inland marine losses are often caused by collisions and cargo theft. If you are storing or shipping high-value items, you will want the added protection that normal property coverage does not allow, including:
- Communications and networking equipment
- Construction and contracting materials
- Photography equipment
- Computers, including laptops and servers
- Medical and scientific equipment
As a contractor in Texas, inland marine insurance is something you should definitely have. While a lot of companies will replace lost, stolen, or damaged products, that is not always a guarantee. With inland marine insurance, you know you’ll be able to claim any damages during transportation.
Texas Commercial Umbrella Insurance / COI
Texas Commercial umbrella insurance is an additional layer of protection for claim payment coverage when the claim amount exceeds the current limits of other liability policies. When you lack commercial umbrella insurance in Texas, any amount that your standard liability insurance policies didn’t cover would need to be paid from your pocket. This can create a financial liability that can ruin a business.
Some of the things that may not have enough coverage on standard policies include:
- Medical bills, including ongoing or future treatments
- Legal costs or the costs to pursue coverage
- Damage totals to public property or other people’s property may be damaged
The way Texas commercial umbrella insurance works are that it acts as an extension of other policies, and it works to absorb additional financial liability associated with insurance claims against your business or employees. It differs from excess liability insurance, however, since excess liability insurance only extends specific limits on specific policies. Commercial umbrella insurance is able to work across policies of different types.
Texas ACORD Certificates
Texas ACORD certificates are special certificate that is issued to holders of certain commercial insurance policies. They are typically made for easy portability and are only a single page in length. They function to give a third party a summary of the business insurance policy specifics. They are also known as an ACORD 25 COI or Certificate Of Insurance. They may also be referred to as a certificate of liability insurance. An ACORD certificate in Texas will include important policy information such as:
- Insurance policy number or unique identifier
- Type of insurance coverage provided by the policy
- Which insurance agency issues the policy
- Coverage limits
- Names of the insured parties
- Policy effective date
- Policy expiration date
Business Insurance for Contractors in Texas
Operating as a contractor anywhere in the Lone Star state requires that you hold sufficient insurance to indemnify you against certain forms of financial liability. Failing to keep these insurance policies active and effective can not only leave you and your business open to incredible levels of potential financial damage. Additionally, there are state and county fines and punishments that may apply if you are found to be operating a contractor business with anything less than the legally mandated insurance minimums. This can mean not only fines but potential criminal charges against those operating the business.
No matter what type of insurance you need, and what you need to be covered, Contractors Liability is has been providing affordable Texas contractors insurance to construction businesses for years. Make sure you are keeping yourself and your business protected.
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Your Texas Contractors Insurance Questions Answered
Get answers to your most common questions from Contractors Liability
For General Liability Insurance in Texas you need $1,000,000 per occurrence and $2,000,000 aggregate almost 100% of the time. 99% of all General Liability policies we sell in Texas are $1,000,000/$2,000,000.
For Commercial Auto Insurance in Texas you need $1,000,000 CSL meaning $1,000,000 Combined Single Limit for Bodily Injury and Property Damage to the other party combined. To protect your Texas vehicle you need to have Comprehensive and collision coverage. Commercial Auto Collision Insurance in Texas covers any collision and Comprehensive Commercial Auto Insurance covers anything but collision.
For Workers Compensation Insurance in Texas you need $500,000/$500,000/$500,000 in general. This covers your workers in the event of a claim where the owner is liable up to $500,000. In 99% of cases the owner is not liable and coverage for workers compensation is unlimited.