How Much Does Electrical Contractors Insurance Cost?
Electrical contractors’ insurance is often a requirement for electrical contracting businesses to conduct any work. Electrical contractors take on a vast responsibility whenever they carry out their services and help to power homes, buildings and communities. According to the Bureau of Labour Statistics, there are almost 50,000 electrical contracting businesses operating in the country. With this increased competition, it is imperative that electrical contracting businesses minimize their costs without compromising safety in order to stay competitive in this market.
It is therefore important that contractors carry their own policies that meet all of their businesses’ needs. Read more below on the average cost of electrical contractor’s insurance and the policies involved.
Electricians insurance includes general liability, worker’s compensation and professional liability for damages and fees up to $1M. The cost for this type of insurance is usually about $100/month for most electrical contracting businesses. However, the monthly cost for this type of insurance varies depending on several factors, including:
- The size of the business in terms of its annual gross sales
- Years of experience
- The number of employees
- The states they perform work in; and
- Claims filed against the business.
In addition to the standard policies mentioned above, additional policies can be purchased for an extra cost. Depending on the needs of your business, a commercial auto insurance and property insurance can also be purchased to cover the vehicles used for transport and the warehouse or office of the electrical contractors. Auto insurance policies will provide insurance for any vehicles registered under your business. Additionally, if your business operates out of an office, you can purchase property insurance to cover your business and equipment. This is especially useful for electrical contracting businesses as it protects their tools, equipment, buildings, and more. Both policies, along with others, can be purchased for a small additional monthly premium.
The above-mentioned policies normally only cover damages and fees of up to $1M. However, electrical contracting businesses often work with equipment worth hundreds of thousands or millions of dollars, and legal fees can quickly add up. Umbrella insurance policies can be purchased separately, which can increase the protection for all the existing policies to above $1M. Umbrella insurance is often a requirement for most electrical contracting businesses as their liabilities can easily go beyond $1M.
The cost for electricians liability insurance can vary depending on factors associated with your business. For example, for smaller businesses with only a handful of employees, the monthly cost of insurance can be relatively low. However, for a larger business with only a few years of experience operating as a business, the cost of insurance can be much higher. In addition to the size of the business and years of experience, factors such as location, revenue, assets, and others can all affect the monthly cost of insurance.
There are a wide number of factors that affect the cost of your electrical contractor’s insurance. The average monthly cost for insurance for electrical contracting businesses is about $100/month, but this can vary widely depending on your business. The best way to find the most accurate cost for insurance for your business is to speak to an insurance broker who has all the details of your business.
According to Farmerbrown Insurance, below is a rough estimate of premiums that usually cost electricians depending on their annual gross sales. Please note that prices vary from state to state.