Types of Insurance Contractors Need

As a homeowner, commercial property owner, or property manager who is undertaking a construction or restoration project, one of the most crucial decisions you’ll make is which contractor to hire.

There are many variables to consider before you select a company, such as cost estimates, the customer service track record, and references. But possibly the most crucial question to ask when you interview prospective contractors in the Billings area is, “What type of insurance do you have?”

If your contractor does not have adequate insurance, you could be held liable for an unfortunate accident or mishap that occurs while your property is under construction. Such a calamity could cost you tens of thousands of dollars out of pocket. The state of Montana requires contractors to possess a minimal amount of insurance. That doesn’t mean you shouldn’t hire one who has more coverage for extra peace of mind!

What types of insurance should you expect your contractor to have?

1. Workers Compensation Insurance

This is the only type of insurance that the Treasure State requires. Workers Compensation Insurance covers medical care if a member of a construction crew becomes ill or has an accident while working on your property. Without it, an employee could hold you or your contractor liable for a catastrophe and thus responsible for medical expenses, such as hospital bills or prescriptions. The result would be a major financial setback.

2. General Liability Insurance

This type of insurance typically covers bodily injuries or property damage that occurs as a result of a contractor’s products, services, or operations. For example, if your contractor accidentally drops a heavy ladder into a neighbor’s yard and it crushes their play equipment, the insurance would kick in to cover the costs to replace their structures. General liability also covers accidents or injuries that occur as a result of shoddy craftsmanship. This even covers if the incident occurs several months after the work is completed.

3. Commercial Vehicle Insurance

Contractors often use specialized commercial vehicles to transport bulky tools and other items to and from construction sites. Commercial vehicle insurance covers any accident or damage resulting from a car or truck that is part of a company’s fleet. For example, if a member of a crew hits another vehicle while on the job, this type of insurance will kick in to cover wreckage both to the company’s vehicle and to the collision victim’s car.

It is protective for you as a homeowner or business owner because it will pay for any harm caused to you or your property by a contractor’s vehicle, such as an incident involving loading or unloading equipment.

4. Tool Coverage

If a contractor’s tools are stolen out of the back of his or her commercial vehicle, tool coverage insurance would fund the cost of replacements. In addition, there are times that contractors possess equipment that is too cumbersome to remove from a work site at the end of each day. If that equipment is stolen from your home, business, or backyard, it is a gray area as to whether you or the company would be held liable. If it is determined to be your responsibility, insurance coverage for tools would fund new supplies.

Making sure that your contractor has these essential forms of coverage will protect both you and the workers who are helping you restore your home. Alpha Omega Disaster Restoration is the premiere property restoration company for businesses and homeowners in the Billings West End, Billings Heights, Laurel and Red Lodge areas.

Our trusted, experienced team completes repairs due to water damage, fire damage, mold remediation and storm damage . We’re motivated by our passion to go above and beyond to provide our clients with high-quality emergency and reconstruction services.