What type of Contractor Insurance do you need?
As a contractor, you have certain duties and responsibilities not only to your client but also to the public. Mistakes in your work can sometimes lead to a financial loss on the part of your client. Although it seldom happens when clients sue their contractors. But when they do, the costs for the claims can be very high.
That is why it is essential that you must get the right insurance policy that is suitable for your business needs. Insurers offer a range of insurance products so you can easily make your own comprehensive insurance package.
How to create your own insurance package?
The life of a contractor or a freelancer is full of freedom. Nevertheless, the downside is as a contractor you are solely responsible for solving any problems that might come your way. For instance, what if your client files a claim against your work or you can’t work because your equipment was stolen or broken. You’ll have to deal with these financial consequences by yourself. Fortunately, there are various types of contractor insurance policies that can help you in dealing with these potential interruptions.
There are different types of policies that you can choose from. Be sure to choose the ones that are required in your line of work so you can make your own personalized insurance policy. You could choose professional indemnity insurance which can cover your client’s claim in the event that you are accused of committing a mistake. Sometimes errors can lead to financial loss and reputation damage.
A public liability policy is another coverage that is relevant to your work. It can cover the costs for the claims on property damage or if you caused someone to get injured. There are a lot of things to consider when making your own insurance package. For instance, the kind of service that you offer to your clients, the equipment as well as the building that you use for your business.
Which insurance policies should you consider?
There are a lot of insurance policies that every contractor should get and the most common ones are Professional Indemnity Insurance, Employers Liability Insurance, and Public Liability Insurance. All of these policies can cover you against negligence in different types of circumstances.
Professional Indemnity Insurance
Professional indemnity insurance can cover the cost of claims in the event that your client decided to sue you after realizing that there is a problem with the work that you have done.
Before purchasing a professional indemnity policy, you must examine the risks that you might be facing. Typically, this policy can cover negligence, defamation, breach of copyrights, and others. Having this policy can give you peace of mind. However, if you want to include your previous work in your coverage, then you can get a retrospective cover. It is essential that you should have a precise amount of coverage for your business. Hence, before purchasing your policy, you might consider several factors such as the projects that you are going to handle, the potential amount of legal fees, etc.
Employers Liability Insurance
This is legally required if your business has one or more employees. Employers’ liability insurance can cover the costs of your employees’ work-related injuries or illness. Business owners are responsible for taking care of their employees, this includes their health and safety while at work. By having the right insurance, you won’t have to worry if something goes wrong.
An employers’ liability insurance can cover you if your employee got injured or ill while working in your company and they decided to file a claim. For instance, an employee who doesn’t have sufficient training got injured while operating a piece of equipment. This employee can make a claim against you.
Public Liability Insurance
A public liability insurance can cover for the costs of legal fees and compensation payments if you’ve caused someone to get injured or damaged someone’s property. For instance, if your client or someone in the building tripped over on the wire of the projector while you are giving a presentation. Or if you have accidentally spilled coffee on your client’s laptop which caused its damage. With public liability insurance, you won’t have to worry when these things can happen to you.
Regardless if you are at fault or not, legal fees are costly, and you might find yourself struggling financially if you don’t have the right insurance policy.
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About business banking
A business bank account is essential for any business – whether you are a contractor or a large firm with thousands of employees. There are many business account options with different account features based on your specific needs, including overdraft options, online banking, free business banking and interest on in-credit balances.