Landscaping Insurance: Cost & Coverage for Your Business

Landscaping insurance, or lawn care insurance, is a group of policies that protect a landscaping business’s assets. The most common lawn care business insurance policy is general liability, which pays for nonemployees’ injuries and property damage. Landscapers’ general liability insurance starts at around $2,200 per year. However, most landscapers need additional policies, and that increases the overall costs.

The policies you need and the total cost of your lawn care insurance depend on many factors, including your business size, location, and the services you offer. For a better idea of how to insure your landscaping business, complete a short online form to receive a quote from the experts at Hiscox in minutes.

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Landscaping Insurance Costs

Landscaping insurance costs vary widely depending on the total policies chosen, the coverage options selected, and your primary operations. A sole proprietor might see an annual cost of $500 while a larger company offering stump removal might have costs of $1,000 for Business Property. Most companies can expect to pay $7,200 to $17,900 in premiums per year if they are getting general liability, workers’ compensation, and commercial vehicle insurance.

Landscaping Business Insurance Costs by Policy

Typical lawn care insurance costs are based on these factors:

• Location: Your city and state dramatically affect all insurance policy premiums. For example, businesses in California are more expensive to insure than businesses in Oregon but, within California, San Bernardino is less expensive than San Diego.
• Payroll: Workers’ compensation coverage is directly related to payroll costs and increases based on the type of risks employees face and the amount they are paid.
• Revenue receipts: Insurance carriers use annual receipts to determine the exposure for liability insurance purposes. The higher the company revenues are, the higher the premium costs.
• Property value: Business tools and equipment value determine the overall amount of property coverage required. The more business property is worth, the higher the insurance premium will be.
• Vehicle type: The year, make, and model of the truck or van used for your lawn care business directly impacts the cost. Different vehicles have different safety features and ratings.
• Main landscape duties: Landscapers who excavate or move earth are a higher risk category than those who have a small garden and lawn care maintenance business.
• Deductible: Higher deductibles reduce the annual premium but make the business responsible for more out-of-pocket expenses in a claim.

All these factors combined are part of the underwriting process, along with the business owner’s industry experience and claims history.

Who Needs Landscaping Insurance?

Lawn care insurance is designed for businesses that maintain commercial or residential lawns or install shrubs, plants, trees, and grass. Policies typically cover a variety of services, including:

• Lawn care services & maintenance: Mowing, weeding, and general gardening services to maintain already-completed landscapes
• Tree pruning & removal: Dusting, spraying, trimming, branch and stump removal, and related tasks—may require licensed tree surgeons to address tall trees safely
• Excavation & grading: Adjusting ground level to create drainage and prepare the land for landscaping
• Hardscape design & implementation: Landscapes with rocks, boulders, and other nonplant concepts often require bigger equipment to relocate heavy items

All 50 states require some sort of license or certification for lawn care and landscaping businesses—about 20 states want to see proof of insurance before issuing a license.

In some states, most landscape contractors have to get licensed while others only mandate licensure for specific operations—most commonly for using pesticides.

Types of Landscaping Insurance Coverage

Landscaping insurance is an industry-specific collection of policies that most lawn care companies need. Landscapers need coverage for third-party claims, employee injuries, and business property damaged by theft or vandalism.

Most Common Landscaping Insurance Policies

Commercial General Liability

General liability covers bodily injury or property damage to third parties, specifically people or entities other than your employees or your business. Third-party injury and property damage are the greatest risk exposures in the lawn care business, with claims and lawsuits that can exceed hundreds of thousands of dollars.

Imagine hitting a gas line when digging a hole, leading to an explosion and fire that engulfs a million-dollar home. Without general liability insurance, a lawsuit could bankrupt your business. What’s worse is that your personal assets may be at risk if you’re a sole proprietor.

Commercial Property Insurance

Commercial property insurance covers assets like your building, equipment, tools, or nursery inventory of plants, trees, and shrubbery. The specific coverage depends on the policy, but most pays for losses from events like:

• Fire
• Theft
• Vandalism
• Hail
• Windstorms

Other events are often covered, so be sure to clarify coverage with your insurance agent or broker.

Another important thing to know about commercial property insurance is that it usually only covers equipment at the address listed on the policy. If someone steals a lawnmower out of the back of your truck, your property insurer most likely won’t pay. For that, you need inland marine insurance.

Inland Marine Insurance

Inland marine insurance covers your equipment, tools, and supplies as you move them from one job to another or while delivering your landscaping products, such as plants and trees, to a client. Policies can also cover any equipment that you store away from your primary location in places like a client’s shed or a garage. Because transporting equipment is common in the industry, most insurers include at least some inland marine coverage on their property policies.

Commercial Vehicle Insurance

Commercial vehicle insurance pays for the other party’s injuries or property damage if you or your employee cause an accident while driving for work. However, that’s just liability coverage, and it’s the minimum required in most states. Landscaping business owners can opt for coverage that pays for damage to their vehicles, roadside assistance, their medical bills, and those of their passengers.

Riding lawn mowers are a common vehicle used by both landscapers and lawn care businesses. However, riding lawn mowers aren’t usually considered a vehicle for insurance purposes as they aren’t designed to be used on public roads. Riding lawn mowers are considered mobile equipment and are insured by either a home insurance policy or a business property policy for lawn care companies.

Workers’ Compensation Insurance

Workers’ compensation insurance covers medical bills and wage replacement for employees who suffer work-related injuries or illnesses. This coverage is necessary for many landscaping businesses because of the risks involved, plus most states require workers’ comp coverage if you have any employees.

Your workers may face several hazards, such as sharp tools, heavy equipment, machinery and vehicles, and even animal bites, which makes workers’ comp coverage critical for your small business.

Business owners usually don’t need to get workers’ compensation for independent contractors. However, to prevent penalties and fines, you’ll need to make sure to treat them as independent contractors based on IRS requirements.

Commercial Umbrella Insurance

Commercial umbrella insurance provides coverage above the liability limits of other primary insurance policies. Lawsuits or significant injuries can lead to very expensive legal and medical bills. If you have a general liability limit of $2 million, but your legal fees are $3 million, umbrella insurance can pay the $1 million not covered under general liability.

Commercial umbrella insurance adds liability coverage to general liability, commercial auto, and workers’ compensation policies. It doesn’t add coverage for professional liability or personal business property coverage.

Surety Bonds vs Landscaping Insurance

In addition to the insurance policies listed above, some landscaping businesses need to be bonded. Surety bonds aren’t a type of insurance. Instead, they act as a guarantee to clients that there’s some level of financial coverage. The landscaper pays a premium to the bond issuer, often an insurance company. If a claim is made, the bond issuer pays the injured parties and then collects that amount back from the small business. Bonds usually cost between 1% and 15% of the total bond amount.

Landscape contractors are often required to purchase a form of surety bond as part of their requirements for getting their license. Note that in most states, landscape contractors are licensed by the state contractors board. Having a surety bond indemnifies the contractor, hence they are ultimately responsible for any losses that they may incur.

Bottom Line

Every landscaping business, whether it’s a sole proprietor lawn service or a full-service landscaping business, should have at least some small business insurance coverage. Even if you don’t have a building or valuable business assets to protect, you work with the general public, which opens up many potential risk exposures, especially employee bodily injury and property damage.

Purchasing insurance for your landscaping business is a relatively inexpensive way to prevent a potentially devastating financial loss. If you need a quick, no-hassle quote for landscaping insurance, a good place to start is with the experts at Hiscox. Plans are easy to understand and customized to meet your needs.

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