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Given the nature of the construction industry and the type of work that piling contractors do, many risks can put a contractor out of business. For example, if damage occurs to a property during a project and the client sues the contractor, the damages can run in the thousands of dollars.
If the contractor has the proper insurance, they will be covered against this damage. However, if they do not, they will have to pay the damages out of their pocket, which could be devastating to the business. Even if the lawsuit is dropped, the legal expenses alone will be a significant sum of money. However, contractor insurance goes further than only property damage. It covers loss or damage to property, equipment and tools that are stolen, and even injuries to people.
When it comes to limiting financial exposure because of damage or loss, a comprehensive insurance program is vital to any contractor’s business risk management strategy. Here are some of the core types of insurance coverages that piling contractors should have.
What is contractor insurance?
Contractor insurance refers to a class of insurance designed to protect construction businesses, rather than individuals, against financial losses due to events that happen in the ordinary course of their business.
As businesses can suffer losses far more significant than individuals, commercial insurance is commonly far more comprehensive than individual insurance. It covers areas like damage to property, damage to equipment and professional liability.
Types of insurance piling contractors need
Piling contractors have various coverages to consider when taking out insurance for their business. However, there are core types of insurance that every contractor needs to be adequately protected.
Commercial general liability insurance
Commercial general liability insurance (CGL) offers the contractor liability protection against claims or lawsuits alleging bodily harm or damage to property that occur during business operations.
For example, a client could sue a contractor for damage to their property during a project. Should the lawsuit be successful, CGL would cover the damages owed to the third-party as well as the legal defense costs.
For this reason, CGL is vital to any contractor’s business, and certain contractors may even be required to have a minimum level of CGL before starting on a specific project.
Builder’s risk insurance
Also known as “course of construction insurance,” builder’s risk insurance protects a contractor’s building and liability against expensive property claims throughout a project’s duration.
For instance, the foundations of a building are installed incorrectly, which leads to damage to the structure. In this case, the contractor’s builder’s risk insurance would cover the cost to repair the building’s foundation.
Contractors typically require their clients to carry this coverage, although contractors are sometimes responsible for this coverage. When finalizing the details of a project, be sure to confirm who will be responsible for purchasing the policy and ensuring all involved parties are covered.
Equipment and tool insurance
Another vital consideration is equipment and tool insurance covering equipment and tools in the case of loss, theft or damage. It also covers equipment or tools that are the property of others, but are in the contractor’s possession.
Suppose a contractor’s tools are stolen from the jobsite before working on a new project. In this case, proper equipment and tool insurance would cover the replacement of the equipment.
Commercial auto insurance
Commercial auto insurance covers a contractor’s commercial vehicles in the same way auto insurance protects an individual’s vehicle. With this insurance, the contractor would be covered should they suffer any loss, like damage to a car or theft of a business-owned vehicle.
It might also be worth considering non-owned vehicle coverage, which covers vehicles that are not owned by the contractor, such as leased, borrowed or employees’ cars, but are used for business purposes.
Get insured
Proper contractor insurance is vital for any contractor to ensure they are adequately protected in the case of damage, whether it’s through an injury, theft or other loss. 
Zensurance leverages data analytics and technological advancement in process automation to deliver Canadian contractors insurance policies for their businesses. It has serviced over 150,000 small businesses across numerous industries. It is one of the most advanced commercial insurance platforms operating across nine Canadian provinces.
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