What is contractors insurance? 

Working in construction or the trades presents many notable risks. Anyone who’s been in the industry knows what can happen on a job site, and many of the other things that can go wrong. Contractors insurance can help industry professionals in Vermont protect their businesses from a variety of risks.

Contractors insurance provides specialized coverages for those in the construction industry. Policies can come with a variety of property and liability protections for contractors.

What kinds of contractors in Vermont are contractors policies for? 

Vermont professionals both in construction and the trades might get contractors policies. General contractors, subcontractors and others all purchased these types of policies.

Some specific examples of who typically purchases these policies include:

• General contractors, subcontractors and independent contractors
• Residential developers, residential contractors and new home builders
• Remodelers and renovation contractors
• Commercial developers and new commercial construction builders
• Demolition contractor specialists
• Marine contractor specialists
• Trade professionals (plumbers, roofers, electricians, etc.)
• Landscapers and hardscapers doing large projects

Because such diverse businesses and professionals get these policies, policies are often highly customized to the particular type of work that someone does. An insurance agent who specializes in contractor and trade insurance can assist with customizing a policy.

What insurance coverages should contractors look for?

Contractors typically need a combination of contractors liability insurance and property insurance protections. The former generally protect against situations where a contractor or trade professional could be responsible for harm to another. The latter generally protect the things that a contractor owns.

A few oft-important contractors liability insurance protections are:

• General Contractors Liability Insurance: Typically covers everyday accidents that result in third-party injuries or property damage, such as slip-and-fall incidents at contractor facilities, customer locations or construction sites.
• Commercial Auto Insurance: Typically covers business vehicles. Usually provides both physical damage protection, and liability protection if there’s an accident.
• Commercial Umbrella Insurance: Typically covers large lawsuits and settlements that exceed the limits of other liability insurances, acting as an additional layer of protection.

Some property coverages that contractors and tradespeople frequently get are:

• Commercial Property Insurance: Typically covers structures, like buildings and garages owned by a contractor. Normally also covers equipment, tools and supply inventory that a contractor has.
• Inland Marine Insurance: Typically covers equipment, tools, and supplies during transportation to, from and between construction sites.
• Contractors Equipment Insurance: Typically covers equipment, tools and supplies present at a construction site.
• Equipment Breakdown Insurance: Typically covers unforeseen breakdowns of necessary equipment, usually paying emergency repair costs to fix the equipment quickly.
• Builders Risk Insurance: Typically covers construction-specific risks associated with the building process and the materials involved. Protection primarily applies to work done and items kept at a construction site.

What work can be covered by a contractors policy?

Contractors policies are versatile, and able to cover many different types of construction. A policy might afford coverage for new construction, renovation or repair of residential or commercial properties.

Can contractors policies cover multiple projects or sites? 

Yes, most contractors policies can be designed to cover multiple projects or sites. An experienced insurance agent can help make sure that a contractor’s chosen policy is able to cover multiple worksites at once.

Do general contractors policies cover subcontractors? 

Whether a general contractor’s policy covers the subcontractors they hire depends on that policy’s terms. Some policies will provide coverage, while others may not. 

One common way to extend certain protections to subcontractors is to name them as “additional insureds.” This is typically a person or business that can also file claims against the policy, even though they aren’t actually the one to purchase the policy.

An insurance agent who regularly works with contractors can help check a general contractor’s policy. They also can help subcontractors ask that they be listed as additional insureds, or help them get their own policy if necessary.