Carpenters Insurance Policy Information
Carpenters Insurance. As a carpenter, you provide an invaluable service to your clients; however, there is always a chance that an accident could happen or that your property could become damaged.
Carpenters may perform interior work only, exterior work only, or both. Exterior carpentry includes framing work, such as structural support for a new building or structure. Interior carpenters perform remodeling, repair, finishing or refinishing. Interior carpentry consists of either rough or finish work.
Rough work includes framing windows and doors, laying floor joists and subfloors, or stairways. Finish work involves hanging doors, installing baseboards and molding around doors and windows, and making or installing cabinets, shelving or other built-ins.
Whether you are a solo practice or you employ a crew, if you own a carpenter business, keeping yourself, your clients, and your employees (if you have them) protected needs to be a top priority. Commercial insurance coverage is the best form of protection you can buy.
Carpenters insurance protects your carpentry business from lawsuits with rates as low as $47/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked carpentry insurance questions:
- How Much Does Carpentry Insurance Cost?
- What Type Of Insurance Do Carpenters Need?
- Why Is Commercial Insurance Is Important For Carpenters?
- What Type Of Carpenters Should Carry Insurance Coverage?
- Do Carpenters Need Commercial Auto Insurance?
How Much Does Carpentry Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small carpentry businesses ranges from $47 to $59 per month based on location, size, payroll, sales and experience.
What Type Of Insurance Do Carpenters Need?
The most common small business insurance policies carpenters carry are: general liability, commercial property and commercial auto. There are other specialty coverages available based on their specific operations.
Why Is Commercial Insurance Is Important For Carpenters?
Someone could become injured on a job site or property could be damaged. When a catastrophe arises and you are liable, the results could be devastating. Medical bills, repairing or replacing property, and legal fees could drown you and ultimately destroy your carpentry business.
Having the right carpenters insurance coverage will help to offset any financial liabilities that may occur, preventing you from having to pay for damages on your own. In other words, insurance will protect your business from significant financial losses. Furthermore, some types of insurance are required by law and you need to carry them in order to legally operate your business.
What Type of Insurance Do Carpenters Need?
There are several types of insurance policies carpenters should carry. Some are required and some are optional, but all are a valuable asset to your business. Essential carpenters insurance policies include:
Commercial General Liability. No matter how big or small your business may be, general liability insurance is an absolute must. This type of insurance offers coverage for third party injuries and property damage, as well as legal fees and settlements.
For instance, if you or an employee damages a client's property, general liability insurance will help to pay for the repair or replacement of the damaged property. If that client files a lawsuit against you, this type of carpenters insurance will also help to cover the cost of legal expenses.
Commercial Property. A business property insurance policy covers damages to your business, including the structure, the contents within it, and parts of the property surrounding it. For example, if a storm damages your building, someone steals equipment, or there is an act of vandalism, this type of insurance coverage will help pay for any repairs that need to be made and the replacement of stolen or damaged equipment.
Workers Compensation. If you employ a crew of carpenters, workers comp is vital. In most states it's required. This coverage protects your employees from any work-related injuries or illnesses that they may sustain.
If an employee suffers an injury while operating machinery, workers comp insurance will pay for medical bills, wages that are lost while the employee is unable to work, any rehabilitation that may be necessary, and a number of other things.
Business Auto. If you rely on cars or trucks for your business, having a commercial auto insurance policy is a wise idea. Should you be involved in an accident while driving a work van to a job site, this policy will cover the damages to vehicles involved in the accident, medical bills, and damaged equipment inside your van.
What Type Of Carpenters Should Carry Insurance Coverage?
Rough and finish carpenters aren't the only professionals who should carry the above-mentioned policies; any professional who performs carpenter-related services should protect themselves with insurance coverage, including:
- Home, business, and framing contractors
- Cabinet installers
- Deck installers
- Construction companies
If you work in any facet of the carpentry industry, carrying the right insurance coverage is crucial.
Do Carpenters Need Commercial Auto Insurance?
Carpentry involves a lot of travel to and from work sites. It also involves specialized equipment that may need to be driven, like cement mixers and bulldozers. You'll need the right business auto coverage to protect your business.
What Does Business Auto Insurance Cover?
Personal auto insurance doesn't cover any vehicle used for work purposes. It also won't cover your construction trucks and equipment. Commercial auto insurance will.
If you own a fleet of company vehicles or trucks, this insurance is required by law in most states.
In the event you need it, you'll be glad you have it. Commercial auto policies have far higher limits for every type of coverage than personal auto policies. Getting maximum liability coverage is especially important, as an accident with any of your trucks or construction equipment can result in hundreds of thousands of dollars in damage.
Without this coverage a single auto accident lawsuit can destroy your ability to do business.
What Else Should Carpenters Consider With Commercial Auto?
If you ever send employees out to run business errands in their own vehicles, you'll want to consider a "hired and non-owners" auto policy. An HNOA policy will cover any liability the company may take on.
Note that you'll need this coverage even if all you're doing is sending an employee to purchase nails or screws. While the employee may bear their own liability for the accident, you as their employer will also bear responsibility. Of the two, lawyers are more likely to be vigorous about suing your business. The perception is you have assets where your employees don't.
You'll want this policy even if you classify your employees as independent contractors. Often, a driver's employment status will not protect you. If the employee was out doing business on your behalf, then in many cases you'll still bear some responsibility.
If you want to avoid having to purchase HNOA coverage, then make sure employees only do errands or business on your behalf while driving company vehicles. This will save you a little money. It will also ensure your employees remain covered every time they drive, which means both your people and your business are taken care of.
How Much Does Carpenters Insurance Cost?
The cost of carpenters insurance varies. The type of commercial insurance policy, the company that provides your coverage, the size of your business, and the liabilities that are associated with your business are just some of the factors that are taken into consideration when determining the cost of coverage.
Carpentry Risks & Exposures
Property exposures at the carpenter's own location are usually limited to an office and storage of materials, equipment, and vehicles. If the carpenter does shop woodworking, fire can result from the flammability of wood, paints, varnishes, and wood dust. There should be adequate ventilation and a dust collection system.
Flammable varnishes and glues should be properly labeled, separated, and stored away from combustibles. Some carpenters store lumber in their yards, increasing the potential for fire loss. Three-sided storage structures are highly susceptible to wind damage.
Premises liability exposures at the carpenter's shop or office are generally limited due to lack of public access. Fires or fumes from woodworking and/or lumber storage operations can spread to neighboring businesses or homes. Outdoor storage may create vandalism and attractive nuisance hazards. Off-site exposures are extensive. Jobsite operations include the potential for bodily injury to the public or employees of other contractors, or damage to their property or completed work.
Tools, power cords, building materials and scrap all pose trip hazards even when not in use. The use of saws and other power or hand tools is inherently hazardous due to sharp edges and moving parts. In enclosed buildings, the buildup of dust and scraps can result in catastrophic fire and explosion. Disposal of waste materials (dust, scrap, varnishes or paints) could create environmental hazards. There may be significant subcontractor and contractual liability exposures.
Completed operations liability exposures are high if the carpenter provides the structural framework of a building due to the potential for collapse. Quality control and full compliance with all construction, material, and design specifications are necessary. Inadequate monitoring of work orders and change orders may be a concern. Poor record-keeping may necessitate payment of otherwise questionable claims. Inspection and written acceptance of the work by the owner or general contractor is critical.
Workers compensation exposures vary based on the size and nature of the job. Work with hand tools and sharp objects such as saws, chisels and nails can result in cuts, piercings, and accidental amputation. Back injuries, hernias, strains, and sprains can result from lifting. Minor injuries may be frequent even when the severity exposure is controlled. When work is done on ladders and scaffolds, there is a potential for severe injury or death from falling, being struck by falling objects, or adverse weather conditions.
The absence of good maintenance of scaffolds, proper use of basic safety equipment, such as properly installed guards, steel-toed shoes, and eye protection, and strict enforcement of safety practices may indicate a morale hazard. Employees must be carefully selected, trained and supervised. Occupational disease exposures can result from exposure to noise, dust, and chemicals, such as from pressure-treated lumber.
Inland marine exposures include accounts receivable if the carpenter offers credit to customers, contractors' equipment for owned or rented tools and equipment, goods in transit, installation floater, and valuable papers and records for customers' and suppliers' information. Equipment at a jobsite can be damaged by drops from heights, weather damage, or being struck by vehicles. Equipment and supplies left at jobsites are subject to theft and vandalism.
Lumber or woodwork can be damaged during transport from shifting, improper loading or inadequate tie down. Oversized loads can be damaged by collision with stationary structures or other vehicles.
Crime exposures are from employee dishonesty. Background checks, including criminal history, should be performed on all employees providing services to customers or handling money. All ordering, billing and disbursement should be handled as separate duties with reconciliations occurring regularly.
Business auto exposures are limited unless lumber and pre-made items are transported by the carpenter. MVRs must be run on a regular basis. Random drug and alcohol testing should be conducted. Vehicles must be well maintained with records kept in a central location. Hazards of transport include failure to secure the load properly and equipment failure, especially tie-downs and hitches. If oversized items are transported, vehicles must be clearly marked.
Commercial Insurance And Business Industry Classification
- SIC CODE: 1751 Carpentry Work, 1521 Single-Family Housing Construction
- NAICS CODE: 238130 Framing Contractors, 238330 Flooring Contractors, 238350 Finish Carpentry Contractors, 236118 Residential Remodelers
- Suggested ISO General Liability Code(s): 91340, 91341, 91342
- Suggested Workers Compensation Code(s): 5645, 5437, 5403
Description for 1751: Carpentry Work
Division C: Construction | Major Group 17: Construction Special Trade Contractors | Industry Group 175: Carpentry And Floor Work
1751 Carpentry Work: Special trade contractors primarily engaged in carpentry work. Establishments primarily engaged in building and installing cabinets at the job site are classified in this industry. Establishments primarily engaged in building custom cabinets for individuals in a shop are classified in Retail Trade, Industry 5712. Carpentry work performed by general contractors engaged in building construction is classified in Major Group 15.
- Cabinet work performed at the construction site
- Carpentry work-contractors
- Folding door installation-contractors
- Garage door installation-contractors
- Joinery, ship-contractors
- Ship joinery-contractors
- Store fixture installation-contractors
- Trim and finish-contractors
- Window and door (prefabricated) installation-contractors
Business insurance can save you from severe losses that could cause severe financial strain and potentially shut down your business. To find out what type of insurance coverage you should carry and how much it will cost you, speak to a reputable agent who specializes in insurance for carpenters.
Types Of Small Business Insurance - Requirements & Regulations
Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.
Commercial insurance steps in to help you manage these risks, avoiding a situation which requires you to pay exorbitant costs out-of-pocket.
Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.
Small Business Insurance Information
In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.
The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.
Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.
According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.
Types Of Small Business Insurance
Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:
- What type of business am I running?
- What are common risks associated with this industry?
- Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
- Does my state require me to carry this type of insurance?
- Does my lender or do any of my investors require me to carry this type of policy?
A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:
|Business Insurance Policy Type||What Is Covered?|
|General Liability Insurance||What is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.|
|Product Liability Insurance||What is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.|
|Commercial Property Insurance||What is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.|
|Business Owners Policy (BOP)||What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.|
|Commercial Auto Insurance||What is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.|
|Commercial Umbrella Policies||What is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.|
|Liquor Liability Insurance||What is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.|
|Professional Liability (Errors & Omissions)||What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.|
|Surety Bond||What is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).|
Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.
Business Insurance Required by Law
If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.
Your insurance agent can help you check applicable state laws so you can bring your business into compliance.
Other Types Of Small Business Insurance
There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:
- Business Interruption Insurance
- Commercial Flood Insurance
- Contractor's Insurance
- Cyber Liability
- Data Breach
- Directors and Officers
- Employment Practices Liability
- Environmental or Pollution Liability
- Management Liability
- Sexual Misconduct Liability
Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.
Additional Resources For Contractors & Home Improvement Insurance
Learn about small business contractor's insurance, including what it covers, how much it costs - and how commercial insurance can help protect your contracting business from lawsuits.
- Air Conditioning Systems Installation Repair
- Appliance Repair & Service
- Blacksmith & Metal Workers
- Builders Risk
- Building Cleaning & Maintenance Services
- Cabinet Installer
- Cable And Satellite TV Installer
- Chimney Sweep
- Contractor Liability
- Curtain Cleaners
- Deck Builders
- Door And Window Installers
- Dryer Vent Cleaning
- Drywall Contractor
- Electrical Contractors
- Environmental Remediation Contractors
- Fence Installation
- Fire Sprinkler Contractors
- Fire & Water Restoration Contractors
- Flooring Contractor
- Garage Door Installer And Repair
- Glass Contractor
- Glazier Insurance
- Gutter Installation And Repair
- House Cleaning
- HVAC Contractor
- Insulation Contractor
- Janitorial Cleaning Services
- Lawn Care
- Lawn Irrigation Sprinkler System Installation
- Paperhanging Contractors
- Plastering And Stucco Contractor
- Pressure Washing Contractors
- Propane And Fuel Dealers
- Rug, Upholstery & Carpet Cleaning
- Sandblasting Contractors
- Security Alarm
- Septic Tank Cleaning
- Siding Contractor
- Sign Installation & Repair
- Solar Panel Installers
- Snow Plow
- Stone And Tile Installer
- Surety Bonds
- Swimming Pool Contractor
- Swimming Pool Service And Maintenance
- Tree Surgeon
- Tree Trimming
- Tank Cleaners
- Upholstery Shop
- Waste Haulers & Garbage Collection
- Water Well Drilling
- Welding Contractor
- Wildlife & Pest Control
- Window Cleaning
A contractor that wants to begin or stay in business, liability coverage must be obtained for the premises or operations, off-site locations and products/completed operations exposures. These coverages may be included as a part of a businessowners policy (BOP) or purchased in a commercial general liability (CGL) policy. Owners and contractors protective liability and railroad protective liability coverages may also be required in certain cases in order for a contractor to obtain a particular job.
Physical damage coverage for tools, supplies and equipment, both on and off the contractor's premises, is a concern. Liability exposures at the premises of the contractor, and at the premises of the contractor's customer, must be properly addressed along with completed operations. Business insurance is very important as is workers compensation insurance protection for employees.
Contractors may work under a general contractor as a subcontractor in larger construction projects - like a new commercial site or residential subdivision. They can work on smaller projects directly with a home owner, usually specializing in renovations or remodels.
In business insurance speak, often called 'artisan contractors' or 'casual contractors', they are involved in many aspects of construction and contracting work – and include various trades and skills. Carpenters, painters, plumbers, electricians, roofers, tree trimmers, landscaping are just a few examples. They may do roofing, fencing, drywall, tile work and many other trades that involve skilled work with tools at the customer's premises.
An artisan contractor performs a single trade or job, and each has its own specialized liability needs with its own exposures to risk and accidents. Contractors liability insurance can offer coverage for bodily injury, property damage, advertising injury and medical payments.
Most artisan contractors should have commercial general liability at the very least, but many need broader coverages - like an umbrella to increase their limits of liability, inland marine policy to protect their tools, workers compensation if they have employees, and even commercial auto if they use vehicles for business purposes.
Minimum recommended small business insurance coverage: Business Personal Property, Employee Dishonesty, Contractors' Equipment and Tools, General Liability, Employee Benefits Liability, Umbrella Liability, Automobile Liability and Physical Damage, Hired and Non-owned Auto & Workers Compensation.
Other commercial insurance policies to consider: Building, Business Income with Extra Expense, Earthquake, Flood, Leasehold Interest, Real Property Legal Liability, Accounts Receivable, Builders Risk, Computers, Goods in Transit, Installation Floater, Valuable Papers and Records, Cyber Liability, Employment-related Practicesand Stop Gap Liability.