A contractor carries certain obligations, legal responsibilities and financial risks. Although claims against contractors are rare, they do happen due to mistakes, which result in considerable wastage of a client’s money and time. Usually, the claims are very high. In such a situation, contractors insurance safeguards your business and financial future.
Why do you Need Contractors Insurance?
Here are some reasons why you would require contractors insurance:
More clients now legally require contractors to be covered by contractors insurance.
Every client has a legal option to claim for mistakes, omission and act of negligence.
In most cases, an agency contract will not cover you.
Liability insurance provides cover in case damage is caused to your client’s property and equipment.
What Policies are Available in Contractors Insurance?
Contractors insurance is of different types. It includes professional indemnity insurance, public liability insurance and employers’ liability insurance.
A professional indemnity insurance policy is designed to protect your firm from legal claims that arise from professional advice and services. Claims typically arise due to mistakes, negligence or omissions.
The insurance policy also pays for a lawyer’s legal costs and compensates the claimant with the claimed amount, if the court awards him/her compensation.
To sum up on indemnity insurance, it offers protection in the following situations:
Breach of written contract, copyright or confidence inadvertently.
Client data or documents that are stolen, misplaced or damaged.
An employee behaves dishonestly or steals from a client.
Public liability insurance is another type of insurance that helps to protect a firm if it is sued by a third party for injuries, death or damage to their property. However, claims occur during the duration of the company’s work.
Liability insurance covers the cost of defending a person against the claim, investigation costs, legal expenses and lawyer’s fees. It also covers compensation amount awarded to a claimant up to a fixed limit.
An employer’s liability insurance policy protects you in case of injuries or death to employees. This is because employees have a legal recourse to file a suit against you in case of your negligence. So, get the best deals by choosing a reputed insurer for contractors insurance.