Working in the construction industry can be very tricky at times for builders. A construction site is one of the most dangerous places to be if you are not equipped with personal protective equipment such as helmets, goggles or even boots. This is because these sites are highly prone to accidents resulting from dropping materials, flying objects or faults in the construction equipment. As a potential investor in this industry, you need to be aware of the potential hazards to your employees. This way, you can effectively budget for the insurance premium you will take for them. This information is not only relevant to an investor. Even a builder can research the risks involved and take the right insurance.
Tradesman Insurance Solutions is one of the best insurance agencies that you can consult within the construction industry. The company has been providing builders, electricians and plumbers with several insurance policies covering the different hazards that come with working on site. Before committing to any policy, you need to research the various types of policies attached to a builder.
Types Of Insurances For Builders
- Builder Public Liability Insurance
This policy protects third parties from injury during a construction project. This policy covers any injury caused to a passerby during construction if you are held liable. The policy is designed to cater to anyone or any property not related to the ongoing project in case of any mishaps.
- Employers Liability Insurance
This is a legal obligation for every construction company. The company takes this policy to protect all the people involved in the construction in case they are injured while performing their duties at the construction site. Most independent contractors tend to overlook this, which could cost them if charges are brought against them.
- Professional Indemnity Insurance
This insurance is very important to any building company. It protects the company in the event a client claims they have been shortchanged in the project. This policy will help shoulder the cost of defending the claim or even compensate the client if the claim is legit.
Installer’s All-Risk Cover
This policy covers the work done by builders that are accidentally destroyed before completion or before an extension of the policy covering this kind of damage. This insurance is mostly overlooked, but you can cover all your bases by signing up for it.
With the types of policies attached to a builder penned down, we can now answer the question of how much it will cost. The cost of a builder’s insurance varies depending on the size of the construction project and the extra costs incurred when replacing and repairing tools and machinery. The larger the project, the more money you should be ready to part with. There are policies that are inclusive compared to others; hence it is advisable to purchase a comprehensive policy that covers most building aspects rather than going for a cheaper and basic option that comes with several add ons. Here is a working average you can go by a point of reference.
The average cost of a builder’s risk insurance ranges from $95 per month to about $200, or it can be paid annually depending on your arrangement with the insurance company. These values are in close proximity to what a construction company is set to pay. Small construction companies are, however, expected to pay between $1000 and $2000 annually. This value is generated from the structure’s completed value, with most policies being worth between 1 to 4% of the total value.
For an expensive project involving the use of expensive construction materials and high labor wages, you may have to take a more comprehensive insurance cover. Most of these covers are designed to cater to damages per incident. The average limit for this policy comes down to around $460,000 with no deductibles.
One thing that stands out is that there is no specific price tag on how much insurance for builders will cost. The values keep changing from one project to another, with the bigger and complex projects having to cough up more on insurance compared to the smaller projects like residential homes. However, builders should not compromise on their safety when it comes to selecting insurance. Browse through the various options presented by different firms to find out what works best for you.
