Electrician Insurance Cost, Coverage, & Providers

Electrician insurance refers to policies protecting against financial loss resulting from property damage, workplace injuries, income loss, and vehicle accidents in work trucks. Electricians may need multiple policies to provide full coverage, but can save using a Business Owner’s Policy (BOP). Electrical contractors usually pay an annual average of $500 to $1,006 for a BOP.

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How Electrician Insurance Works

Electricians can’t just buy one policy to provide coverage for all potential risks. However, many providers offer bundled coverage allowing electricians to group policies to achieve cost efficiencies. Electricians interested in saving on coverage for property damage and general liability can purchase a Business Owner’s Policy as well as supplementary coverage specific to their trade.

A Business Owner’s Policy includes commercial liability insurance, which pays for claims arising if an electrician injures someone or causes someone property damage. The BOP also includes property damage coverage if an electrician’s own property is damaged. And, it sometimes includes business interruption insurance in case an electrician temporarily becomes unable to operate.

Top Electrician Insurance Providers

The Hartford

If you’re looking for the simplest way to get all coverage you need, The Hartford is best for bundled coverage. Getting bundled coverage is simple because of The Hartford’s “Stretch” endorsements tailored to policyholders in particular industries. Stretch endorsements bundle key coverage with a Business Owner’s Policy—such as $10,000 in installation coverage—so you don’t have to determine what additional protection you need.

Hiscox

Hiscox is a small business insurance specialist that prides itself on understanding the specific risks faced by the industries they cover. Hiscox’s familiarity with the electrician trade allows it to provide customized coverage to its clients. Hiscox offers professional liability policy options that may be attractive for small and growing firms. Moreover, electricians can pay annual premiums in monthly installments for no extra charge. Quotes are instantly available online after a brief application.

Insurance 321

When you want a little more hand-holding from an agent perfectly matched to you, turn to Insurance 321. Insurance 321 uses proprietary technology to connect electricians with a commercial insurance agent best suited to help them find coverage. Agents are experienced in servicing small businesses and talk with more than 30,000 companies monthly. The process of getting coverage is streamlined, with agents assisting in finding the right coverage and quotes available within minutes.

Progressive Commercial Insurance

If you have lots of work trucks and want to save on commercial auto insurance, choose Progressive. Progressive provides a package discount if policyholders purchase commercial auto insurance along with other coverage they need, including an Owners and Contractors Protective Liability policy sometimes required for subcontractors. Discounts could be as high as 15 percent. Progressive allows policy shoppers to obtain quick online quotes for their package policies to make getting covered easier.

AP Intego

When you’re looking for the best priced policy, check out AP Intego. Their nationally licensed agents will shop and compare your coverage needs to top-rated insurance companies such as Travelers. If you’re not sure what coverage you need, let their expert agents guide you in selecting policy types appropriate for electricians.

Types of Electrician Liability Insurance

Electricians need coverage for risks their work presents to others and for potential loss to their business. Electrician liability insurance and permit bonds protect against loss to others. Property coverage and workers’ compensation protect against damage to equipment and employee injury. Auto insurance provides both coverage for work vehicles and coverage if an accident injures others.

A Business Owner’s Policy groups general commercial liability, property coverage, and loss of business income into one policy. Bundled coverage can be significantly cheaper than buying individual policies. Many insurers, including those listed above, allow additional endorsements or add-ons to a BOP to provide the additional coverages electricians need.

Most Common Types of Electrician Liability Insurance

Business Owner’s Policy

Every electrician needs a commercial general liability policy due to risks associated with electrical work. You could be sued for damaging someone’s property; your own equipment could be damaged; or your business could be forced to stop operating due to disaster. You need coverage for all these potential calamities, and a Business Owner’s Policy groups these three important coverage types to achieve cost efficiencies.

With a BOP, the three types of coverage you’ll get include:

• General liability policies, which cover damage to someone else’s property or injury you cause. If you cause a fire due to faulty wiring, your policy would cover burn injuries to property owners and the cost to restore the structure.
• Property damage policies, which cover damage to your own property, such as equipment. If your tools are stolen from your office or damaged by vandalism, they’d be covered.
• Business interruption insurance, which covers income loss. If your trucks and equipment are destroyed by a fire and you can’t work for two months, you’d be covered for lost profits and operating expenses.

A Business Owner’s Policy provides all three types of coverage bundled in one policy for significant cost savings.

Surety Bonds

Surety bonds are insurance you may need to buy, but these bonds don’t protect you. They protect people you’re working for. If you work for the government or certain property owners, you’ll be required to buy surety bonds to act as a guarantee that you’ll perform appropriate work.

There are different kinds of surety bonds, including completion bonds guaranteeing you’ll complete work as contracted, as well as license and permit bonds guaranteeing you’ll obtain permits and comply with other building codes. If you don’t fulfill your obligations, the surety pays the property owner for losses and tries to collect from you to recoup the payout.

Workers’ Compensation Insurance

If you have employees, there’s a significant risk of on-the-job injury or workplace fatalities. In fact, according to the Occupational Safety and Health Administration, electrical injuries are one of the top four causes of all fatal construction accidents. Workers’ compensation insurance protects against the risks of an on-the-job injury or death.

In case of injury, workers’ compensation coverage pays for:

• Medical costs incurred in treating on-the-job injuries
• Lost wages if workers miss time at work
• Temporary or permanent disability benefits for total or partial disability
• Death benefits to surviving dependents after a workplace fatality

Workers’ compensation insurance is required in most states, with limited exceptions. For example, Texas doesn’t require workers’ compensation coverage, while other states require coverage only if you have a certain number of workers (more than three is common).

Commercial Auto Insurance

Commercial auto insurance provides coverage for all work vehicles you own. It also provides coverage for injuries and property damage caused by an employee involved in an auto accident on-the-job. Employees are considered agents of your company and you can be liable for losses if they cause an accident while driving for work.

Builder’s Risk Insurance

Your property damage policy may limit coverage for damage to equipment in situations where tools or machinery are on your property. If you sustain damage while on a construction site, you may need builder’s risk insurance to be fully covered. It also provides coverage if something goes wrong with your work product before a job is complete, such as a storm or fire destroying wiring you installed.

Electrician Insurance Costs

When buying electrician insurance, the size of your business, policy limits, and deductibles affect costs. Median premiums for Business Owner’s Policies run $500 to $1,006 for $2 million in coverage. Electricians typically pay $200 to $1,257 for surety bonds with policy limits determined by project costs, and around $2,135 to $4,857 for workers’ compensation. Auto insurance adds $1,672 to $4,377 in costs for $1 million in coverage, and builder’s risk insurance runs between $1,000 and $4,000 when necessary.

Electrician Insurance Costs & Deductibles by Insurance Type

The cost of your policy will be affected by:

• Your experience and credentials: If you’re fully licensed and certified and have been in business for many years with no history of problems, your costs will be lower than if you’re just starting out or if you have a history of past claims.
• The number of employees: The more people who work for you, the higher the cost you can expect to pay for workers’ compensation insurance coverage.
• The number of vehicles in your fleet: If you have many work trucks driven by multiple employees, your commercial auto insurance costs will be much higher.
• The value of the equipment and tools you own: When you have very expensive specialized equipment to cover, your Business Owner’s Policy will come at a higher cost due to the need for added property damage coverage.

If you’re a one-man shop that does small projects and is covered by the general contractor’s Builder’s Risk policy, self-employed electrician liability insurance costs are low. If you’re a major electrical contractor with a team of employees you provide with work trucks, costs are much higher.

Tips on Getting/Applying for Electrician Insurance

Buying electrician insurance can be complicated because you need many different types of coverage and will likely have multiple insurers to choose from. When comparing policies and applying for electrician insurance coverage, it’s important to know what to look for and to shop carefully for the right coverage. These tips from insurance experts can help.

Start the Process Early

If you don’t have insurance coverage but will soon be performing electrical work in a professional capacity, don’t hesitate to begin shopping for insurance.

“As soon as an electrician is performing any work for a customer, they should have at least general liability in place,” advised Greg Knepper, an insurance agent with Integrated Coverage Group. “The process for applying for this type of coverage should start at least several weeks prior to needing the coverage in place.”

An insurance certificate will provide proof of insurance, if necessary, to submit bids for work or to obtain permits. In Philadelphia, for example, contractors seeking electrical permits must provide proof they have at least $500,000 in liability coverage before a permit will be issued.

Understand Your Coverage

When you begin exploring options for electrician insurance, it’s imperative you research coverage options carefully.

“Electricians should make sure that they understand what’s included and what’s excluded in the policy,” Knepper said.

He urges electricians to focus on the specifics. For example, while damage you cause to someone’s home while performing work is covered by a commercial general liability policy, if you damage only the electrical panel you’re installing, that likely wouldn’t be. Knepper also stressed that you may need more insurance coverage as you expand operations.

Get Multiple Insurance Quotes

To make sure you get the best price on electrician liability insurance, compare prices for multiple policies. Ideally, try to get at least three quotes. You can do this on your own using online sites such as Insureon or work with insurance brokers to find the right coverage.

“An independent insurance broker will procure quotes from several carriers and present the best options,” Knepper said.

Electrician Insurance Frequently Asked Questions (FAQ)

You can check out the answers to some frequently asked questions here to find out more about getting covered.

How do policy limits work on general liability insurance for electricians?

When you obtain general liability insurance as a standalone policy or as part of your Business Owner’s Policy (BOP), there are two policy limits: a per occurrence limit and a per policy limit. The per occurrence limit caps the maximum amount paid per claim, while the per policy limit caps the total paid per policy.

Does a general liability policy cover faulty work?

If faulty work results in property damage or injury, the losses you caused would be covered by your general liability policy. However, if no one was harmed and you’re sued for not fulfilling work in accordance with contract terms, this is a breach of contract claim—not an injury or property damage claim—and isn’t covered.

What does insurance cover if you’re sued?

If you’re sued for a covered occurrence, your electrician liability insurance should provide coverage for costs up to your policy limit related to the investigation, defense, and settlement or damage awards. You’ll be covered for claims settled out of court, decided in civil court, or decided using another dispute resolution process (e.g., arbitration).

Bottom Line

Electricians need to ensure they have appropriate electrician liability insurance coverage in case claims are made against them, or in case injury or damage to their equipment or other property occurs. Get covered before you begin work, as having the proper coverage is essential to be eligible for certain jobs and can protect you from financial disaster.

If you’re an electrician, you should be sure that your policy protects you from potential lawsuits and disasters. The Hartford is an industry leading insurer that offers policies specifically designed to help electricians. Visit The Harford today to get a quote in minutes.

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