What is construction insurance? Construction insurance provides various types of coverage for the construction industry. If you have a construction business, you need safeguards in place to ensure you, your employees, and your business as a whole is protected if an incident occurs. Below, learn what construction insurance is and discover eight key types of construction insurance.
What is Construction Insurance?
So, what is construction insurance, and why does my construction company require coverage? Ultimately, there is a lot of risk involved in the construction industry. Heavy machinery, equipment, and the general nature of the work are all factors that can lead to injuries, delays, and other common issues. Luckily, several types of construction insurance protect your business and keep things running smoothly.
Moody Insurance is a Colorado insurance agency with deep roots in the construction industry. We are affiliated with a massive network of high-caliber construction industry partners. These partnerships empower our team members to remain ahead of the industry’s risk-management needs. Moody provides ongoing professional development opportunities for employees to gain a comprehensive knowledge of the complexities within construction industries. Ultimately, working with our agents means you are working with an expert In construction industry insurance – so you can rest assured you’re getting the right coverage for your needs.
Types of Construction Insurance
If you’re wondering where to start, it’s a good idea to look at the different types of construction insurance. Ultimately, nearly every construction company will require surety bonds, general liability, insurance, commercial auto insurance, builder’s risk insurance, worker’s compensation, professional liability insurance, and even key person life insurance. Get the breakdown of all these key coverage options below:
- Surety Bonds
- General Liability Insurance
- Commercial Auto Insurance
- Builder’s Risk Insurance
- Workers Compensation
- Employee Benefits
- Professional Liability Insurance
- Key Person Life Insurance
1. Surety Bonds
Surety bonds are a key component of construction insurance. Essentially, surety bonds outline the nature of your contract with a client, guaranteeing your construction company fulfills the terms that you agreed to at the onset of the project. However, if your construction company cannot complete the project or fulfill the terms outlined in the contract, the insurance company can provide reimbursement to your client for the financial losses.
When it comes to construction insurance, the surety bonding process can be one of the more complex aspects of protection. Luckily, agencies like Moody Insurance have dedicated surety managers that will build a surety insurance plan that aligns with your business’ specific needs. We also provide contracts with all major sureties, as well as regional sureties, environmental sureties, and high-risk markets.
2. General Liability Insurance
General liability insurance is a key coverage option for essentially any business, across industries, and there’s a reason why. Essentially, general liability insurance provides holistic coverage for several types of risks so you don’t have to pay out-of-pocket for things like slip-and-fall incidents, reputational harm lawsuits, or property damage. It can often cover things like medical expenses and administrative costs for claims. Plus, if your business goes to court, it can even cover those costs, including settlements for covered claims.
3. Commercial Auto Insurance
Chances are, your construction company utilizes multiple vehicles to get to jobsites, and work on those jobsites. When employees are tasked with operating those vehicles, commercial auto insurance becomes a crucial component of that business’ insurance suite. If a member of your team uses a commercial vehicle for a work-related task and gets into a crash, that’s when commercial auto insurance comes into play. It can help compensate for damages and medical expenses from an incident.
4. Builder’s Risk Insurance
Builder’s risk insurance covers the risk of property damage for construction projects. Accidents happen on job sites, and it’s important have coverage when property inevitably gets damaged. Property could include the materials, equipment, or fixtures involved in a build. A building could also face fires, high winds, theft, and beyond while under construction. Builder’s risk insurance ensures your business does not take on that liability when the unexpected happens.
5. Workers Compensation
If an employee gets injured on a jobsite, they are typically entitled to worker’s compensation for medical treatment and adequate leave. All construction companies must take the proper precautions to protect their employees, but sometimes an inevitable accident occurs. In those cases, worker’s compensation covers wage replacement and medical benefits – which in turn removes the threat of legal action for negligence from the employee.
This is a critical component to your construction insurance (and the insurance needs for nearly every industry). Worker’s compensation is required for employers in many states, including the state of Colorado.
6. Employee Benefits
Many businesses opt to provide employee benefits to incentivize team members and provide coverage for medical, dental, vision, and other common expenses. It supports retention and provides important services to employees. With the help of an employee benefits expert, you can create a solid insurance plan that aligns with your construction company’s size, package requirements, and any other important factors. As an independent insurance agency, Moody has access to several insurance providers so you get great coverage that aligns with your budget and your team’s needs.
7. Professional Liability Insurance
Professional liability insurance covers certain causes for legal action that are not covered by general liability insurance. It applies if a construction company does not properly deliver the service or end product outlined in the contract with a client. Typically, professional liability insurance comes into play if a client reports negligence from the construction company. Professional liability insurance is required for all businesses in certain states, including the state of Colorado.
8. Key Person Life Insurance
Another element of business insurance is key person life insurance. This is particularly beneficial for larger organizations with key leaders. In the event that a designated person passes away, this insurance compensates for the financial losses that would arise. Many construction companies have major stakeholders and leaders who manage a large breadth of the business. If one individual acts as a major income generator, or provides skills that are difficult to replace, this insurance is a great way to make sure your business remains financially protected while restructuring.
What is Construction Insurance: Creating a Plan
So, what is construction insurance? Essentially, it’s a package of key insurance offerings catered specifically to the risk involved in construction projects. The best way to determine which packages your business needs is to work with an agency that specializes in construction insurance services. Moody’s team of insurance experts can walk you through all your options, and provide recommendations based on over 50 years of experience providing construction insurance.
Types of Construction Insurance: Access all Options with Moody
If you’re ready to discuss the types of construction insurance that best suit your business, contact Moody Insurance Agency today. We provide commercial insurance, small business insurance, employee benefits, personal insurance, and surety services. Our team can provide custom recommendations based on your organization’s needs so you receive the ideal coverage options.
Get in touch today to get started.