The construction industry is rife with risks and exposures. Even the most well-maintained worksites with advanced safety measures may eventually experience accidents, errors and other mishaps, potentially incurring significant financial consequences. Fortunately, construction insurance can limit losses and help affected parties recover and resume operations.

What Is Construction Insurance?

Construction insurance can generally be seen as a specialized form of business insurance focused primarily on the needs and circumstances of those in the industry. Contractors, subcontractors and large construction firms can all benefit from the financial safety net cast by adequate construction insurance. An adequate construction insurance portfolio typically consists of several types of policies, depending on a policyholder’s unique circumstances.

What Does Construction Insurance Typically Cover?

Construction insurance typically comprises several types of insurance featuring various coverages and financial protections. In many cases, the following types of insurance may apply to a construction business’s needs:

• Errors and omissions (E&O) insurance

• Commercial property insurance

• Business interruption insurance

• General liability insurance

• Workers’ compensation insurance

• Builders risk insurance

• Inland marine insurance

• Commercial auto insurance

• Tools and equipment insurance

• Commercial umbrella insurance

Does Construction Insurance Cover Subcontractors?

When enlisting the assistance of subcontractors for a project, both the general contractor and project owner must diligently delve into the unique circumstances of the job at hand. While subcontractors may require their own insurance, including workers’ compensation coverage and E&O coverage, they may also be listed as an additional insured on another party’s policies. Subcontractor insurance needs can be influenced by specific aspects of a project, such as its location, so it’s essential to work with a qualified insurance professional to assess each situation on a case-by-case basis.

How Much Does Construction Insurance Cost?

Many factors can influence construction insurance rates, and carriers may analyze the following:

• Location

• Construction services offered

• Number of employees

• Years in business

• Value of insured assets

• Business revenue

• Claims history

• Coverage details (e.g., types of insurance needed, deductibles and coverage limits)

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Lakenan Insurance has been serving businesses, homeowners and families since 1938. Contact us today to get started.