Why General Liability Insurance is Important for Construction

Construction can be a very aggressive and demanding industry. Strong liability coverage can protect against injuries, accidents or property damage suffered on the job.

Workers can easily damage property mishandling materials and tools, or while a remodeling process is underway. With many jobs, it is a requirement to provide evidence of general liability insurance as part of the qualification process. Subcontractors are also required to present proof of insurance before beginning a particular job.

The Benefits of General Liability Coverage

This policy protects your business from lawsuits or damages made by claims during the construction process. The most significant advantages of securing this coverage are:

  • Protecting your business against injury and/or property damage.
  • Assisting you in covering costs and damages after a judgment has passed.
  • Providing a certain level of value and security knowing that your assets and employees are protected.
  • Using it to cover the cost of attorney fees, witness fees, court expenses, and more.
  • Protecting in many different ways: your company as a whole and individual claims against the company.

Coverage

Construction liability insurance might be used in the following circumstances:

  • Injury claims – Might be used to pay for medical expenses, funeral, and court-awarded compensation. (Not a worker’s comp type of coverage).
  • Damage claims – Protects you when your company damages the customer’s property or if your business is responsible for their inability to use that property.
  • Product claims – Claims related to damages caused by equipment installed by your company, can be managed and addressed.
  • Copyright claims – If you own a design or product, you might be sued for copyright infringement when it is very similar to your competitors’.

Cost & Limits 

The cost associated with your liability insurance will depend on the risk perceived with the type of work you are doing. Normally, commercial contractors with a higher risk of damages, for example, a roofing contractor, or contractors who perform highly specialized trades are the ones with the biggest insurance coverage. The amount of liability insurance is directly related to the amount of money that the contractor is executing. It’s recommended to have insurance coverage of two or three times the amount of construction project budgets.

It is important to be aware that general liability insurance for construction does have limitations. You must set limits per each occurrence and aggregated values. Limitations are also set for fire damage to property under construction as well as medical expenses for injured workers on the job site that aren’t covered under workers ’ compensation. No matter the size of the job, having adequate general liability insurance for construction is always the best policy.

About SB One Insurance Agency

At SB One Insurance Agency, we have served the businesses and residents of New Jersey, New York, and Pennsylvania for more than 60 years. We are a wholly-owned subsidiary of SB One Bank, the region’s premier banking institution, and we are prepared to offer you personal, business, employee benefits, and risk management solutions. To learn more about our coverage options, contact our specialists today at (888) 990-0526.