You are expected to provide a service everyone needs while also accounting for the dangers inherent in electrical systems. Without the proper insurance, one bad day could cost you everything you worked so hard to achieve.
But how much does it cost? Your business is unique and thus rates are tailored based on your exposure. It is highly recommended to use an Electrician Insurance estimator to get a more accurate cost.
Electrical Contractor Insurance Cost
Some of the factors that affect Electricians insurance cost are:
Total Revenue: The more revenue you make the higher your premiums will be.
Exposure: If the percentage of your operations is mostly commercial than residential, chances are the premium might be higher. Bottom line is, get insured appropriately according to your business exposure to avoid unexpected cost from third-party claims.
Policy Limits: The most common limits are $1,000,000 per occurrence $2,000,000 aggregate. Some jobs might require you to have greater limits. If this is the case you will need to pay more coverage.
Claim history: For companies with impeccable safety records, this could mean a reduction in insurance rates. If you’ve had claims, your premiums will be higher.
Where your business is located: As a general rule of thumb the more liberal the state is, the higher the insurance premiums. An electrician that does work in the 5 Burroughs of New York City can expect to pay 4 to 5 the amount on insurance the same business in Houston, Texas.
Not only that, there are several types of policies that you need to consider to protect you directly and your assets. Below is a list of them:
1. Commercial Auto
This needed if you use your vehicle to transport work supplies like parts, testing equipment, and other tools. If your vehicle only has personal liability coverage, there is good possibility that claims will be denied if the insurance company finds out you were using a vehicle for commercial purposes.
2. Workers Compensation Insurance
If you have employees you are required by law to have coverage. Employees and owners will not be covered by General Liability Policy should anyone employed or sub-contracted by the company get injured while doing the work.
3. Inland Marine Insurance
If all your tools where stolen or destroyed you would be in a pickle. No tools mean no way to make money. Inland Marine Insurance for electricians covers your tools if they are lost or destroyed.
4. Electrician’s Payment and Performance Bonds
If you are doing a project for a GC or a Government entity they may require a bond to ensure the work is completed. These types of bonds are based on credit. If your credit score is above 700 and the job is under $400,000 they can be obtained with just a one-page application and signature.
In most states, having general liability coverage is required by law. Even if it is not, you should obtain a low-cost Electrician’s General Liability Insurance Policy. You will be able to have confidence that if there’s an accident – you will be covered. You also have the benefit of knowing that your clients will also be protected as well.
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