Your Trusted Advisor For Plumbing Insurance Including General Liability, Workers' Compensation, Commercial Auto, Property, and Business Owners Policy (BOP) Insurance
As a plumber in business for yourself, your most valuable asset is your reputation. Responsible plumbers that care about their business and their clients should have plumbing insurance to protect clients, and to make sure one small issue doesn't derail your entire plumbing business. Plumbing insurance is much more than protection from liability, it also protects against the rising costs of lawyers and litigation from false accusations.
In some locations, you may be required by state and/or local law to carry insurance to be licensed. If that's the case for you, it's especially important to work with someone who knows what types of insurance is required, and what types of insurance coverage is acceptable. Not all liability polices may meet your legal requirements. In other words, one policy that may otherwise appear just fine for your plumbing business, may not be acceptible for your license. Sometimes, there's alternatives, for example, bonding that will take the place of liability insurance, but again, you want to make sure you're doing things the correct way the first time, otherwise you run the risk of having to buy another policy when you would rather be plumbing and making money.
We have plumbing insurance and much more specifically designed with your business in mind. It doesn't matter if you're brand new just starting your first business, or a seasoned veteran with years of experience. The types of trades that are within the plumbing industry type of coverage include the following:
- Plumbing Contractors
- Plumbing Business Owners including those with a retail store
- Pipe Fitters
- Septic Tank Installers
- Sprinkler and/or home irrigation Installers
- Home Builders and Contractors
- Handypersons (we also offer coverage designed specifically for handymen/persons)
A Business Owners Policy (BOP) is a package of coverage that includes general liability and property coverage. The property coverage can be real estate, and/or business personal property. Business Owners Policies normally also include loss of income coverage. Under qualified business interruptions, the policy will help pay your business expenses to keep the doors open and the lights on.
General Liability is the most often sought after insurance coverage. It's usually the "main" in plumbing insurance. General Liability is the type of coverage that's designed to protect a business in case an owner or employee causes property and/or bodily injury, and importantly it can provide for legal defense in the case of a lawsuit. If a business doesn't require the transfer of their risk of loss for property, then this is the most common alternative to BOP coverage.
Commercial Auto for Plumbers is what is sounds like. It covers vehicles that are used for the purpose of making money in a business. This is maybe the most misunderstood types of coverage for new business owners. Many plumbers just starting out are under the incorrect belief that their personal auto coverage will be fine for their work vehicles without even checking with their current agent. Many are outright surprised to find their personal auto coverage does not cover their truck or work vehicle used for their plumbing business. Sometimes, the owner learns of this after an accident, and that's when things really go bad. This is especially true when you're pulling a commercial trailer behind your work vehicle.
It's a challenge for anyone to argue the use is within a standard personal policy when your truck and trailer have your plumber logo on the side, and you're going from one job site to another. If that's the case when you're in an accident, you can expect to push-back from your personal lines auto insurance. To make matters worse, if it's an employee driving your vehicle, your challenge just went up even further. In short, if you're using a vehicle for your plumbing business, you're almost always better off with a commercial auto insurance policy.
The most common types of vehicles with commercial auto coverage for plumbers is the standard pick-up truck, vans, box trucks, and trailers.
Workers' Compensation Insurance isn't just for plumbers with employees. Many self-employed plumbing contractors are required by contractors to have workers' compensation even though they don't have employees. Most plumbers acting as a sub-contractor don't want to have their own payroll count towards a workers' compensation, even though they're required by the main contractor. The solution to this is getting a workers compensation ghost policy. You can read more about it by clicking on the link, but for now, consider it a workers compensation policy that covers no one, hence the name "ghost policy".
For those with employees, we have various options available including dividend paying policies in Wisconsin, and pay-as-you-go workers' compensation in every state we're in, including Wisconsin, and including assigned risk (workers' comp pool insurance). In some places, including Wisconsin, workers' compensation pricing is the same from every insurance carrier and the only choice for a plumber is selecting from what agent they like best. That said, even in Wisconsin with the premium price the same between various carriers, there can be a difference in the total cost because of dividend payments. Dividends are not guaranteed, but over a long-enough number of years, dividends have historically lowered the total cost of workers' comp insurance for employers. What that means is, if you're a Wisconsin plumbing employer, and your workers compensation insurance policy isn't elegible for a dividend, you'll likely want to look at alternatives to lower your total labor cost.
Pay-as-you-go workers compensation is just as it sounds. You pay some as a deposit, often much lower than otherwise, and then you simply pay for the use as you use it. It shifts the timing of premium payments from before the use, to after the use and can be a great benefit for a plumbing contractor's cash-flow, especially if there's a lot of employees.
Another type of coverage often found in workers compensation is employer's liability. Employer's liability covers types of liability claims that don't fall within general liability and are beyond a standard workers' compensation policy. The usual types of employer liability claims fall into the following classes:
Third-party over actions – When another party is found liable and has a cause of action against the employer. Manufacturers may sue an employer to collect for contributory negligence (in states that allow for contributory negligence). An example may be if an employee sues a manufacturer for an injury caused by a powertool. If the manufacturer believes your maintance program was faulty and negligent, the manufacturer may try to collect its cost from you.
Dual-capacity Lawsuits – when an employee is injured from a product your business manufactured. For plumbers, this could be as simple as a special tool you made to make a job.
Loss of Consortium – lawsuit from a family member (typically a spouse) because they're not able to participate in the normal activities a given family member may enjoy as a member of the family.
Consequential bodily Injury – Again, typically a spouse, and often because of a family member's stress manifests itself in a physically delibriating and/or painful manner as a result of their family member's injury while working.
Property Coverage Insurance can be for your building and/or business personal property. Personal property is generally anthing that isn't considered real property. Real property is land, building, and anything permanently attached to the land or other real estate. For example, a furnace is real property when it's connected to a building, but if you disconnect it and place it in your truck, it reverts back from real property into personal property.
Within the category of business personal property is inventory. Inventory is property for sale and not (usually) for use. Also within the business personal property category is "inland marine". Inland marine insurance is coverage for business personal property that leaves the shop. A great example for plumbers is the tools used to perform work on the job site. Business personal property coverage is usually limited to so many feet from the business location (often 500 or 1000 feet). For property that moves around, inland marine coverage protects it from losses including theft and damage (damage doesn't normally include damage from use, but rather if there's a fire or something along those lines).
As you can tell, plumbers have unique risks that require a professional business focused agent that understands the contractor industry as it applies to plumbing contractors. Because plumbers normally work with water unless it's new construction, and even then, at some point the water gets turned on, a simple basic general liability policy not designed for the plumber in mind may have serious exclusions, including water damage that can render the policy worthless for many times of problems at a time you want insurance protection the most.
How much does Plumbers Liability and other types of insurance cost?
The primary influencers are the amount of coverage (the most common amount of liability is $1 million per occurrence and $2 million aggregate), what your gross revenue for the next 12 months is (estimates are made at the start of the policy period), years of experience, if you're bundling more than one type of coverage (for example – a BOP policy and commercial auto, and/or workers compensation), and any claims, lawsuits, and/or losses in the past three and five year periods. If you have losses, the amount paid out may have an influence.
By working with an independent agent, you can count on receiving real value for your dollar. Independent agents can shop coverage for you, and are not "stuck" with only one option available. When it comes to business insurance, one size really doesn't fit all. The best part is you don't have to pay extra to get high quality consulting to find the appropriate policy for your plumbing business.
According to the 2017 North American Industry Classification System (NAICS)
238220 Plumbing, Heating, and Air-Conditioning Contractors:
This industry comprises establishments primarily engaged in installing and servicing plumbing, heating, and air-conditioning equipment. Contractors in this industry may provide both parts and labor when performing work. The work performed may include new work, additions, alterations, maintenance, and repairs.
Cooling tower installation
Heating, ventilation, and air-conditioning (HVAC) contractors
Duct work (e.g., cooling, dust collection, exhaust, heating, ventilation) installation
Lawn sprinkler system installation
Fire sprinkler system installation
Fireplace, natural gas, installation
Refrigeration system (e.g., commercial, industrial, scientific) installation
Sewer hookup and connection, building