Plumbing businesses are unsung heroes, showing up at all hours and wading into messes to protect homes and businesses. Plumbing businesses need protection, too, and plumbing insurance can help. Learn more about how it works and the best providers.
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How Plumbing Insurance Works
There’s no single plumbing insurance policy. Instead, each plumbing business should choose policies that best meet its needs and its budget. A self-employed plumber who works out of their home will have different needs than a large plumbing business with multiple employees.
Most plumbing businesses will need general liability, commercial property and commercial auto insurance. You can typically save on insurance costs by purchasing multiple policies with one insurance provider.
Types of Plumbing Insurance
Which business insurance policies should a plumbing business choose? Here are several types of plumbing insurance.
General Liability Insurance
General liability insurance protects your business from 3 types of claims. The first type is bodily injury, which covers claims if someone is injured due to your business. For example, if a client slips and falls in your shop or trips on a tool while you’re making repairs, the client could sue. Your general liability coverage would help cover their medical costs and defend you from potential lawsuits.
The 2nd type of coverage is property damage. This helps cover damage to someone else’s property that’s caused by your business. If water leaks while you’re making a repair, general liability insurance may help cover the repairs and restoration along with any resulting lawsuits.
The 3rd type is personal or advertising injury. This provides coverage due to libel and slander. Say your employee tells a business owner that one of your competitors uses shoddy materials, but that isn’t true, the competitor could sue for damages.
Commercial Property Insurance
Whether you work from home or rent or own a workspace, commercial property insurance is critical. It protects your business’ physical structure along with your inventory, tools, furniture and any personal property on the premises. It covers losses due to fire, theft, wind, vandalism and civil unrest.
It doesn’t typically cover damage from earthquakes or floods, so if you live in an area that’s prone to either, consider purchasing additional coverage.
Business Interruption Insurance
If there’s damage to your business, it hurts more than your physical property. You may also need to close down or relocate due to the damage, which costs you income. Business interruption insurance helps cover that income and other operating expenses like lease payments, loan payments, taxes and payroll.
Policies typically limit coverage to a 30-day restoration period, but you can request a longer one. Unfortunately, policies don’t usually cover closures due to a pandemic or virus.
Business Owner’s Policy
Many plumbing businesses are good candidates for a business owners policy (BOP). This policy bundles general liability, commercial property and business interruption insurance. Bundling these types of coverage together saves money and ensures you have appropriate coverage in each area.
In general, businesses with fewer than 100 employees and less than $5 million in annual revenue are eligible for a BOP but check with insurance providers to be sure.
Commercial Auto Insurance
If you or your employees drive to or from client appointments, commercial auto insurance is critical. Commercial auto insurance covers any vehicles, including trucks and vans, driven for business purposes.
At a minimum, a commercial auto policy should have liability insurance, which covers the injuries and property of the other parties if your or your employees are found to be at fault in a collision. Your state may also require uninsured/underinsured motorist coverage. Even if it’s not required, it’s worth considering in case you’re involved in an accident with an uninsured, underinsured or hit-and-run driver.
Your state may also require medical payment coverage. This covers injuries to the driver of your vehicle and any passengers. You may also want to consider comprehensive and collision coverage. Comprehensive coverage helps to pay for damage that’s not due to a collision, including flood, fire, theft, falling objects and earthquakes. Collision covers damage to your business vehicle if it’s involved in an accident.
Workers’ Compensation Insurance
Workers’ compensation insurance is essential because it covers your employees if they have a work-related illness or injury. It can help cover their medical care, lost income and even assist them with rehabilitation, depending on the terms of the policy.
Workers’ compensation insurance is required by most states, although the exact laws vary significantly based on where you live. It also protects you from employee lawsuits due to work-related injuries. If you don’t carry workers’ compensation, you may be violating state law and you’re leaving yourself vulnerable to lawsuits. If you have employees, talk to a reputable insurer about workers’ compensation insurance.
Cybersecurity/Data Breach Insurance
While cybersecurity might not sound like a concern for a plumbing business, most businesses store client information in databases. They may also have payment information for their clients, and both of those are appealing targets for cybercriminals.
Cybersecurity insurance should be a part of your cybersecurity plan. It helps you recover in the event of a data breach or another cyber attack. Cybersecurity insurance may cover loss of assets due to viruses, legal defense fees, fines, penalties and business interruptions due to cyber attacks.
Commercial Umbrella Insurance
Insurance policies have limits. For example, you might purchase a general liability policy with a $500,000 limit. That might sound like a lot, but if a client is hurt and no longer able to work, their medical costs and lost income could easily add up to more than $500,000, and you’re responsible for the difference.
Commercial umbrella insurance picks up when you exceed your policy limits. It provides additional coverage up to its policy limit. It typically provides additional coverage for multiple policies, and you purchase it from the same insurer that holds your general liability or commercial property insurance.
Cost of Plumbing Insurance
Many factors impact the cost of plumbing insurance. Insurers consider:
- The size of your business
- The condition of your business location
- Your industry
- Number of employees you have
- Your claims history
- Whether you’re taking measures to prevent injuries
- Where you and your employees drive (for commercial auto)
- You and your employees’ driving history (for commercial auto)
- Type of vehicle being driven (for commercial auto)
|Policy||Annual Premium||Coverage Limit|
|General Liability Insurance||$350||$2 million|
|Commercial Property Insurance||$755||$60,000|
|Business Income Insurance||$500-$1,500||Based on business income|
|Business Owners Policy||$800-$2,000||$1 million per occurence/$2 million per policy term|
|Commercial Auto Insurance||$1,700||$1 million|
|Commercial Umbrella||$500-$1,500||$1 million|
|Cybersecurity/Data Breach||$1,500||$1 million|
You can lower the cost of your insurance by increasing your deductibles or by lowering your policy limits. This also leaves you more vulnerable to claims, so aim to balance your insurance costs and having the coverage you need.
Choosing Plumbers Insurance Policies
Which policies are right for you? That depends on your business and the specific risks you face. To learn more about policy costs, contact multiple insurance providers and get quotes. Review each quote carefully, comparing the premiums, coverage and service. Choose a provider with competitive rates and outstanding customer service.