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Performing quality electrical work requires mastery of complex wiring systems and meticulous attention to detail.
But operating a successful electrical contracting business comes with its share of thorns, from fires to falls, electrocution, and liability claims.
What happens if faulty wiring causes a fire that damages a client’s home or business?
Or does an employee get injured while working on an electrical panel? Situations like these highlight why having proper insurance can help protect electrical companies.
But what exact coverages should you carry to protect your finances and business? How much liability insurance is enough?
And does workers’ compensation apply to electricians? Let’s explore these common electrical contractor insurance questions further.
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Table of Contents
Critical Insurance Requirements and Additional Coverage Options for Electrical Contractors
Whether upgrading commercial lighting or repairing electrical systems, electrical contractors enable businesses and households to stay powered up.
Impeccable installation and safety are crucial for delivering results that meet the code and wow customers.
However, performing electrical work comes with substantial risks, ranging from liability claims to workplace injuries.
Proper insurance is crucial to protect your finances and business assets if the unexpected occurs.
This article outlines essential commercial insurance coverages electrical contractors need, including:
- General liability insurance
- Workers compensation coverage
- Commercial auto insurance
- Equipment coverage
- Installation floater insurance
- Umbrella liability coverage
The Allen Thomas Group is happy to provide you with essential business insurance for electricians to safeguard your business assets and reputation.
General liability insurance is crucial for contracting businesses working in both residential and commercial spaces. It covers legal defense costs and settlements up to your policy limits if you are deemed liable for bodily injury, property damage, or other harms.
Electrician liability insurance protects your finances under the following types of situations:
- Faulty cables cause a fire that damages a client’s property
- Electrocution injury due to improper grounding or insulation
- Employee negligence damages sensitive computer systems
- Accidental damage to a customer’s furnishings or finishes
Even with strict safety protocols, you cannot prevent accidents. Professional liability coverage from a top insurance company provides peace of mind if faced with a sizable claim.
Employee injuries are a real possibility when you are responsible for handling live electrical wires and working from heights. Falls, shocks, burns, cuts, strains, and other claims could result in substantial lost time and medical expenses.
Carrying proper workers’ compensation insurance is mandatory in most states. It covers lost wages, medical bills, rehabilitation, and long-term care for injured employees. When an accident happens, use workers’ comp coverage to help the injured worker without worrying about claim costs.
Key aspects of workers’ comp insurance for electrical businesses include:
- State-required limits based on payroll and risk classifications
- Claim administration expertise to facilitate medical care and return to work
- Discounted prescription drugs and access to provider networks
In addition to fulfilling state requirements, workers’ compensation insurance can help prevent workplace injury claims from depleting your finances.
Partner with an insurance broker specializing in helping electrical contractors safeguard their business.
As an electrical pro, you rely on expensive tools like conduit benders, wire pullers, cable cutters, volt testers, and power drills to deliver professional results efficiently. Having proper insurance to repair or replace these assets following financial losses is essential.
Options for covering contractor equipment include:
- Inland marine insurance – Broad coverage for tools and equipment with a blanket limit.
- Scheduled policy – Covers specific high-value items with selected limits per item.
- Installation floater – Tools and materials for a specific job site can be covered.
Discuss the right approach with your insurance advisor based on your tools, materials, and exposures.
Don’t leave crucial equipment uninsured.
Performing major electrical installation contracts often means you have substantial money tied up in materials staged at the job site and work completed awaiting sign-off. Fire, storms, floods, theft, and vandalism could all strike before the customer accepts and pays for the finished electrical work.
Installation floaters and builders’ risk policies cover materials and contracted work against loss while on a customer’s premises during a project.
This coverage helps safeguard your invested time and materials if a catastrophe strikes.
A serious injury claim could exceed your policy’s limits even with a general liability insurance policy. This opens your electrician business assets up to potential seizure without extra protection.
Adding an umbrella liability policy provides a second layer of coverage above your general liability maximum. It provides $1 million to $5 million (or more) in additional protection to cover catastrophic claims that breach your primary policy limits.
For electrical contractors taking on major installation projects, umbrella insurance provides coverage and invaluable peace of mind.
It prevents having to pay claim amounts beyond your normal policy limits if faced with a worst-case incident.
How To Find the Right Electrician Insurance Agent?
Navigating the numerous risks contractors face requires an insurance agent familiar with the electrical trades.
When you are looking for essential insurance for electrical contractors, be sure to choose an agency that:
- Focuses specifically on electrician business insurance. They understand why you need insurance.
- Has relationships with multiple carriers, so they have unlimited options to shop for and give you the optimal combination of price, coverage and service.
- Provides ongoing support, not just at the renewal time.
The right agent becomes a trusted risk management advisor, helping you avoid coverage gaps and continually improve safety protocols.
When you are looking for expert yet affordable electrician insurance, trust the experts at The Allen Thomas Group to fulfill your coverage needs.
Get started on a quote for business insurance, like general liability coverage, workers compensation, commercial property insurance, errors and omissions insurance, and commercial auto coverage, quickly.
Getting The Right Insurance For Your Electrical Installation Business
We know how frustrating and complex the process of finding the right coverage and getting a COI can be and how it slows down your ability to care for your customers.
Let us help fix it for you in 3 easy steps.
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Electrician Business Insurance for Contractors FAQs
Average annual premiums range from about $15,000 to $100,000+ depending on your payroll, revenue, claims history, and trade classifications.
Your insurance agent can provide quotes tailored to your business.
Carrying robust business liability along with umbrella coverage is strongly recommended.
Given the severe shock and fall risks, limits of $2 million or more are advisable.
An insurance expert can advise on prudent levels for electricians and electrical contractors.
General liability covers legal defense costs and payouts (up to your policy limits) if you are liable for third-party bodily injury or property damage stemming from your electrical work.
Yes, maintaining proper commercial auto insurance is essential for electrical contractors operating any vehicles for business purposes.
It protects your company if an employee causes an at-fault accident while driving for work.
Workers comp requirements vary by state. Virtually all states require electrical contractors to carry comp insurance.
This coverage can help cover lost wages and medical expenses for employees injured on the job, regardless of fault. Get professional insurance advice to maintain state-compliant coverage.
- New York
- North Carolina
- South Carolina
Need Insurance? Get the Best Insurance Cost To Protect Your Business
With electrical contractors working, there is a vast potential for risk, from falls to electrocution, burns, and costly damage claims.
Carrying proper insurance coverage to help pay expenses is crucial to avoid financial hardship when accidents and mishaps happen.
Work with an independent insurance agent experienced in covering electrical and contracting trades.
They can assess the electrical contractor’s unique risks and build a comprehensive program with appropriate insurance products.
They understand the value of comprehensive coverage and ensure your insurance policy covers you against all potential dangers and liabilities.
With the right insurance portfolio, you have a guarantee of coverage against potential mishaps that threaten your business and reputation.
When you need coverage, contact The Allen Thomas Group’s commercial insurance experts to discuss various types of business insurance requirements for your electrical contracting business.
Apart from essential insurance, our experts will help explore if you need additional coverage.
Take the first step to shield your business now. Contact us to get affordable coverage.
Insurance helps safeguard your business against potential risks and liabilities. The process to get a certificate of insurance gets easier with us.