Plumbing insurance – cost and types of policies

Whenever you budget the expenses of your business, Plumbing insurance must be near the top of the list because you can’t always know exactly what could happen in the future.

With the protection provided by liability insurance and all the other sorts of insurance we will tell you about, you can protect your business and yourself in case something unforeseen happens.

Like any business owner, for your Plumbing enterprise, you must consider how much financial risk you are taking on.

If your Plumbing business runs without proper insurance, you are taking a giant chance not just of losing some money but of a complete wipe-out.

This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the results of their actions. 

In this article, we are giving very general guidelines for growing businesses to explain what the main kinds of insurance that you need are, and where we can, a rough guide to how much you can expect to pay.

The question is, can you afford to NOT have insurance for your Plumbing business?

What this means, for any Plumbing business owner, is that if some person claims that your work caused them some physical or economic damage, a court can award damages far beyond the total size of your business.

Your Plumbing business is not sheltered by laws in the same way as states are, where edicts can place a “cap” on the maximum level of liability.

In some states, like Montana, there are specific monetary levels that limit the amount a court can award in any case against the state.

In a court case, it’s purely the privilege of the jury to award whatever amount they deem appropriate, even sometimes giving a plaintiff more than they have sued for.

When you are running your Plumbing operations, you can’t avoid responsibility for the outcomes of your actions.

Even more importantly, unless you have spent beforehand the money necessary to have your business running as a limited liability company, all of that liability belongs to you as a person.

What does Plumbing insurance protect you from?

For your Plumbing business, the most important kinds of insurance are intended to cover the risks to your business from accidents, from unexpected events, and from mistakes.

Also there are some mandatory kinds of insurance that various states require.

In the next few paragraphs, we will outline the most important points any Plumbing business owner should know when negotiating the insurance needed.

The main categories of insurance for your Plumbing businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.

Liability insurance

General liability insurance

Any Plumbing business is dealing directly with customers, and that means you always have the danger that some accident can happen to them bodily or else something of theirs can be damaged.

In such a case, they can require compensation.

General liability insurance policy for your Plumbing business protects you against claims coming from injury to clients or damage to their property.

It protects your Plumbing business from the claims themselves and as well to any resulting court costs and legal fees of the lawsuits.

In many cases, it will even help you to qualify for extra business from city and state organizations, where contracts demand proper liability insurance.

The usual level of general liability insurance for your Plumbing business would be with a upper limit of $1 million for a single claim and a total of $2 million for the whole year.

See the table in the costing section below for average prices of general liability insurance for your Plumbing insurance operations.

Professional liability insurance for your Plumbing business

In the event where a client alleges some negligence, errors, or omissions in how you conducted your Plumbing business for them, you can quickly have to fight a law suit.

Even if the matter against you is decided in your favor, the cost of defense can be high, and the impact on your reputation can be damaging.

Most small Plumbing business should have enough professional liability insurance to cover an individual claim of $25,000, with annual cover of $50,000.

See the table in the cost of Plumbing insurance section below for average prices of professional liability insurance for your Plumbing operations.

Product liability insurance

Whatever goods you sell or advice you give about the goods, you are running a risk that clients may claim that what you delivered didn’t meet your description of function, or that your guidance was basically incorrect.

You need to know the particular laws of product liability in your own state.

For example, in California, all businesses in the supply chain can be held liable for results caused by products claimed to be defective.

To cover yourself against any likely lawsuit, you need Product liability insurance for Plumbing

Only you can know exactly how much insurance you should get.

Best advice is to talk to experienced insurance agents, brokers or company representatives for guidance.

Commercial insurance

Commercial vehicle insurance for your Plumbing business

Beware! – almost all policies for private vehicle insurance do not cover any occurrence like theft or accidental damage when the van is being used for business purposes.

The proper way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a direct commercial vehicle insurance package.

Commercial car policies insure the value of any vehicle in case of accident, malicious damage, fire, or theft.

As well, in case of any accident, the car itself, the content and any legal bills, medical expenses, and property damage is insured if your van is involved in a collision.

Most states, other than Virginia and New Hampshire, require this type of insurance.

The necessary value of the insurance is worked-out for the depreciated value of the vehicle, and your intended level of cover of contents. 

Tools and Equipment insurance

Since your Plumbing business needs specific and costly equipment, you will realize how much it can cost to replace it in case of any damage, loss, or theft.

The equipment may be subject to malicious damage, deliberate fire, theft, other such unforeseen acts.

In addition, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can wipe-out your whole business in one stroke.

Unless you can afford to immediately replace such unique gear quickly out of your own pocket, you need full-level equipment insurance so that you can immediately buy everything needed to keep your Plumbing business running.

It is impossible to advise how much equipment insurance you need – it’s essentially dependent on how much you have invested in your Plumbing business’ equipment.

Commercial Property insurance

Any Plumbing business that owns or rents space in a building should have a commercial property insurance policy.

If you own the space, you may already have a substantial capital investment, in addition to a big liability if there’s a mortgage.

Any physical building location should carry insurance coverage for the value of the premises and contents against unexpected occurrences like fire and storms, and against man-made damages like theft and vandalism.

If your Plumbing business operates in areas of high risk, like Texas or Georgia, extra coverage may be needed for earthquakes and hurricanes or tornadoes.

In other states like Rhode Island, where unlimited cold snaps can cause damage to outer coverings of Plumbing business premises, there is a need for more extra cover than in warmer climes.

Whereas the level of cover depends completely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of Plumbing insurance section below to give some indication of the average prices per million dollars of property insurance for your Plumbing business.

Temporary insurance by month, week or day for your Plumbing business

Is your Plumbing business working part-time or casually, or is the level of business fluctuating?

Using short-term insurance makes perfect sense. Business insurance by the month, day, or week – temporary insurance for Plumbing – are special policies where you can cover a nominated period when you want to be covered.

By only paying for that period of cover, you will save by having lower premiums but still having the same risk cover.

The key feature of short-term insurance is that you purchase the cover for a defined period – a nominated date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.

When you are expecting periods of larger business activity, get the existing cover increased.

Talk to your insurance agent, broker or the company’s representatives to see what options you have.

Business Owners Policy BOP for your Plumbing business

You have the choice to combine a few of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.

A BOP merges commercial property and public liability insurance by incorporating these coverages into one insurance policy, which can save you money.

BOP insurance will shield you if any claims of injury or property damage are made.

It is often the right choice for small and medium-sized Plumbing businesses, such as yours.

There are two limits that will dictate whether BOP is suitable for your own business.

BOPs cannot cover your professional liability or commercial vehicle cover.

Also, the size of your business will dictate whether you are permitted to take out BOP cover.

The normal business that can take out a BOP policy must have less than one hundred employees, and maximum five million dollars in annual revenue.

In addition, you must separately take out the necessary worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your Plumbing business employees

In most states, it is mandatory to have workers compensation insurance when your Plumbing business has one or more employees.

Workers compensation insurance covers the operation against any costs that arise if a worker experiences an injury or becomes sick as a result of work.

The benefits include medical expenses, death benefits, lost wages, and vocational rehabilitation.

Failure to meet a state’s regulations in this regard can leave you as the employer having to pay penalties levied by the states.

Some states, such as North Dakota, Ohio, Washington, West Virginia, and Wyoming only authorize coverage from the government-run monopoly state funds.

In these states, you cannot get your workers compensation obligations from private insurance corporations.

Workers compensation charges are worked out based on the employee’s pay, and usually come out at around $1.00 per $100 per month.

However, you must consult the relevant authorities in your state.

Average costs of these types of insurance

Although every Plumbing insurance need is unique, there are enough examples of usual quotes from insurance companies for us to give approximate guidelines, including what are the cheapest rates offered.

Of course, you should always check with an insurance representative what’s relevant for your business.

The list below is of annual premiums we have collected for the main types of insurance your Plumbing businesses needs.

Cost of insurance for your Plumbing operations depends on many different factors.

We have estimated these figures for small independent Plumbing businesses.

In larger states like California, premiums are generally about 20%-30% higher than national averages, but in smaller states like Utah, they will be about 20%-30% cheaper.

The location and size and type of your Plumbing business can have a big effect on the cost of different policies.

You should consult with professional insurance agents and brokers, or insurance company representatives.

As well you can let the internet do the work for you by looking for insurance companies near where your business is located.

Another good source of information is the local Better Business Bureau in your town.

FAQ

What is small business insurance for Plumbing operations?

This is a general term used to describe standard insurance policies designed to protect Plumbing business owners from risks like bodily injury, property damage, claims of negligence.

Does my Plumbing business have to have insurance?

Some of the types of insurance are not mandatory for you to operate your business, but they can protect you from risks in your business operations.

Several other forms are required by state law, such as workers compensation and vehicle insurance.

What does a small Plumbing business insurance policy cover?

Liability insurance provides insurance against lawsuits or claims filed by a client for bodily injury, property damage, or negligence.

The precise cover will vary based on your own operations.

See the table in the costing section above for average prices of the recommended policies for Plumbing insurance.

How much will Plumbing business insurance cost?

On top of the size of the business, some other factors, such as location and claims history, are used to determine your policy’s cost.

You should discuss with professional insurance agents and brokers, or insurance company representatives.

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