In general, electrician insurance will start from a general business owner's policy, which is a combination of mainstay coverages such as general liability, commercial property, and business income insurance. From there, electricians can customize their policy based on their coverage needs, the number of employees they have, and electrician specialization.
General Liability
A general liability insurance policy is to provide coverage for claims that your business caused property damage or personal injury to someone else. General liability is common for most businesses and is considered an essential policy, which is why it's the backbone of a business owner's policy. General liability insurance will usually cover the electrician business as a whole, but not individual employees.
Commercial Property
Commercial property insurance is protection for any of your owned or rented properties you used to run your business. For example, if you have a brick and mortar location to store amp meters, screwdrivers, wire strippers, power tools, or other tools and equipment, the commercial property insurance coverage will protect your property from theft, fire, or other damages.
Business Income
Business income insurance is another mainstay of a business owner's policy. Business income insurance will provide coverage for lost income if you cannot run your electrician business because of property damage. In other words, business income insurance will give your business protection while you are recovering from damages to your business location or electrician equipment.
Other Types of Insurance Coverage to Consider
In addition to the basic coverage you should expect from your business owner's policy, there may be other types of insurance coverage you want to consider. For example, you may want to include worker's compensation insurance, coverage for tools and equipment, or commercial auto insurance based on the specifications of your small business.
Worker's Compensation
Because electricians are at a higher risk of being injured on the job, it's imperative for business owners to provide employees with worker's compensation insurance. In many states, you are required to provide worker's compensation insurance, even if you only have a few employees. Worker's compensation insurance will provide coverage for medical care, disability benefits, and lost wages.
Commercial Auto
Commercial auto insurance may also be a good policy to include on your electrician insurance plan. Commercial auto insurance will cover any commercial vehicles that you use for your business, including vehicles that are used to transport materials to work sites.
Most commercial auto insurance will provide coverage if a vehicle is stolen or damaged in a car accident and may also provide auto injury liability, property damage liability, collision insurance, and uninsured motorist coverage. Because many electricians use specialty commercial vehicles, having this insurance policy is important.
Hired & Non-Owned Auto
Hired and non-owned auto insurance is also a good type of coverage to have. This policy will provide coverage for property damage and bodily injuries that are caused by an accident if you or your employee is using a personally owned or rented vehicle for business purposes. For example, if you or your employee use a personal or rented vehicle to visit a client, this insurance policy will cover the costs of vehicle repairs and physical injuries.
Equipment Breakdown
Equipment breakdown insurance is essential for jobs in various industries, including the electrician industry. This type of policy will cover the cost of replacement or repairs for equipment that unexpectedly breaks down. Specifically, this insurance policy will provide coverage for mechanical breakdowns due to faulty manufacturing. This policy will not cover the repair or replacement of equipment that breaks down through wear and tear.
Tools and Equipment
Tools and equipment insurance can also be important. This policy will provide coverage for electrician tools and equipment that is stolen, lost, or damaged. However, be sure to remember that this type of policy has certain limitations. For example, some insurance policies for tool and equipment insurance will be limited to electrician tools that are less than five years old.
Errors and Omissions
Finally, it might be important for your business to have errors and omissions insurance coverage. This coverage is helpful if a client ever accuses you of not doing a job correctly. This type of policy will provide coverage for any legal costs and settlements your business may have after a claim. Because legal costs can be very expensive, this type of insurance can allow your business to recover more quickly after a complaint without losing momentum or profits.
What Isn't Covered By Your Insurance Policy?
There are several things that will not be covered by your business owner's insurance policy. For example, the vast majority of policies will not cover damage to business property caused by natural disasters such as earthquakes, floods, hurricanes, or wildfires. Your insurance policies may also not cover infectious diseases, intentional fraud, or the government seizing your property.
Which Electrical Contractors Need Insurance?
Regardless of specialty, most electrical contractors will need to have an insurance policy. For example, electricians that work with electrical control installation, fiber optic installation, low and high-voltage electricity, lighting, residential and commercial electricity, and general electric services all need to have insurance.
How Else Can Electricians Support Their Business?
Robust insurance coverage is only one part of the equation when you are trying to run a successful electrician business. Streamlining your daily business management by using home service software can be a great resource to increase your profits and customer satisfaction. This software can include easy scheduling and dispatching, invoice and payment programs, and integrated accounting features.
Having insurance as a business owner is the best way to ensure your business is protected. For electricians, your business owner's policy should include general liability, commercial property insurance, business income insurance, and other policies such as worker's compensation, commercial auto, and equipment breakdown. To learn more about how to improve your electrician business, contact ServiceBox today.
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