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California Contractor Liability Insurance

It’s hard to be uninsured these days. There’s danger lurking around, waiting for the right moment to pounce on you. And being a contractor, you always want to cover all your bases. You don’t want to have any surprises along the way. That’s why it’s wise to get insurances to shield you from any risks that might spring up.

Furthermore, the State of California requires all contractors to have insurance so that they could protect themselves, as well as their employees to any unforeseeable risks in the future. Thus, getting California contractor liability insurance is not just some luxury to be had, but a necessity so you could conduct business without worrying the future.

By being insured, you transfer equitably the risk of a loss, from your company to another, in exchange for a premium. You pay a guaranteed little amount of money to prevent a potentially large and upsetting loss that might lead to your own bankruptcy. Simply put, by investing in a risk management policy, you evade the risk of a devastating loss.

Now comes the hard part, you have to decide the best insurance company that can give you the best California contractor liability insurance policy. There are lots of insurance companies out there but you have to determine which of them can give you more coverage.

First, you have to research on various insurance companies. Check if they are credible; check their credit rating and their insurance report card. Usually, they always give a quote of the insurance premium, and then compare the premium being offered to you with other insurance companies. Select the best offer that gives you the most out of the insurance policy.

Once you have decided which insurance company to go to, read the fine print of the policy being offered to you. Before you sign and make the first payment, understand first the coverage of the insurance policy. Know the general liability of your policy, the workers compensation (in case of any accidents), auto insurance and bonding.

Generally, all contractor insurance policies protect you from common risks present in any construction projects. Example of these typical risks is delay in remuneration, workplace accidents, or lagging on time frame requirements.

However, I suggest that you ask more coverage on some areas that are also risks prone. As a rule, always try to include in your California contractor liability insurance policy these two: insurance against defective products and insurance protecting you from any litigation. Apart from being necessary, these two clauses are crucial to your company’s future. Imagine if you installed faulty wirings on a home, or unwittingly used substandard housing materials and then an accident happened because of the wirings or the walls caved in. In such cases, it is the contractor who is liable for the damages. Thus, any long term insurance planning can protect the contractor from these scenarios.

Aside from the defective product clause, you should also pay close attention on whether you are insured from future costs of litigation. Unfortunately, the cost of litigation is very expensive and can ruin any company that is not prepared for it in the long haul. Hence, it would be wise for you to insure yourself from these costs by protecting your financial future.

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Bryan McDonald is author of this article on Independent Contractor Insurance. Find more information about Worker`s Compensation Insurance Companies here.

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