3 Types of Insurance to Protect Construction Businesses
BY Jim Loughlin
As with any company or industry, road building comes with potential risks that can have a significant impact on the business. Because of industry risks, there’s a great need to protect the business against significant financial losses due to claims or lawsuits. Keep in mind that even one lawsuit can have a serious impact on your finances.
For example, a 2017 accident along Beltway 8 in Houston, Texas, caused the death of 41-year-old Heywood Freeman and his two children. Freeman’s car was hit by another driver while they were trying to drive through a construction zone. Even though the accident was between two motorists, Freeman’s wife has now filed a lawsuit against the construction company, claiming they did not safely manage the traffic flow in a work zone, or post adequate signs to warn drivers of the construction.
It’s not just motorists and pedestrians that can get hurt in a work zone. The road workers themselves face tremendous risk. According to the Bureau of Labor Statistics, between 2011 and 2015 over 600 road workers were killed while on the job in the United States, with 46 percent of those killed after being struck by a car. These are sad reminders of the dangers of working in this industry, and highlight the need to protect your business and your employees.
No matter how prepared you think you are, accidents can happen at any time. That’s why it’s crucial to carry adequate insurance to make sure you and your employees are covered. It’s designed to protect your company against significant financial losses, whether from a worker’s compensation claim or a lawsuit. Just one claim can cripple operations and even force a business to shut down.
Insurance comes in many types, and each is designed to protect a particular aspect of a company. To choose the right kind of coverage, the key is to know what you’re up against. In the case of a road builder, it’s crucial to assess the needs of the company and the potential risks involved in the industry. Here are a few types of insurance those in the road building industry should have:
General Liability insurance
Chances are, you and your employees interact on a daily basis with people such as clients, vendors, subcontractors, and motorists driving through a work zone. Any one of them could experience an injury or loss and if your business is to blame they can file a lawsuit. This type of coverage protects both your business and your employees. It will take care of the medical bills and costs related to property damage due to day-to-day operations.
Business Owner’s policy
If you’re a business owner, you’re subject to liability. You need to make sure you’re protected. The Business Owner’s policy is a combination of the General Liability and Commercial Property insurance, offering savings compared to purchasing the coverage separately. It’s ideal for small and medium-sized businesses because it’s a convenient way to be adequately protected.
Worker’s Compensation insurance
Worker safety should always be a top priority; however, accidents can happen at any time. This policy is a legal requirement in most states in the United States; it takes care of the medical expenses and salaries lost of employees who sustain injuries at work. It protects both parties—the business owner against expensive lawsuits, and the employees who will receive benefits in case they get sick or injured at work.
Having proper coverages is one method of risk management to minimize the chance of a damaging claim or lawsuit shutting down your business. Carry adequate contractor’s insurance and set up management plans so everyone knows what to do and what to avoid while working. Make safety a priority, not only for the business but also for motorists on the road.
Jim Loughlin is an insurance industry veteran with 25 years of experience. He is currently the senior sales director at CoverWallet, a tech company that enables businesses to understand, buy, and manage insurance online. For more information, contact him at (646) 844-9933 or visit coverwallet.com.