What is the best plumber’s or plumbing contractors’ insurance in Westchester and Rockland Counties, NY?
How do you get the best plumber insurance coverage for your contracting business?
What does plumbing contractors’ insurance cost?
In this video and post, I’m going to answer those questions and give you some advice on how to approach business insurance for plumbers and plumbing contractors in Westchester and Rockland, coming right up.
So, you probably are thinking about your business insurance for your plumbing company and are curious about costs, coverages, or some other issue or common insurance problem and looking online for advice or guidance.
I hope to cover some of the common issues we find with plumbing contractors’ insurance here, but if there’s a question you have that I didn’t answer, please contact me for a conversation, I promise no hard-core selling or pushing to quote your account and I love solving problems for business owners so I’d welcome your call or email.
What is the best plumbing contractor insurance?
In my opinion, the best plumbers insurance protection is one that is thoughtfully planned and carried out by an expert.
That typically means working with an insurance broker that is experienced in business insurance and who works with contractors on a regular basis.
I don’t think that websites that promise to get you a quote in 10 minutes by answering a few questions make a lot of sense.
Why?
Because, like it or not, business insurance is complex.
And in that 10-minute process who is the expert?
You are.
You’re being asked to be the insurance expert to understand your risks and the thousands of insurance coverages, forms, and options available in the marketplace.
Look, I get it, convenience is great – but at what cost?
Do you want to potentially sacrifice the business you’ve built and worked so hard for to be lost in a lawsuit because you didn’t know what excluding action over liability mean? Or why do you need an umbrella policy?
The other point here is that just because an insurance website says that they are the cheapest for plumber’s insurance and the most convenient doesn’t necessarily make it true.
What coverages should plumbers think about?
For most plumbing contractors in Westchester & Rockland Counties, a business owners policy or BOP policy is going to give you the core property and liability coverage you’re going to need. Inside that BOP you’re going to look at the following things:
General Liability
Most BOPs provide a $1,000,000 limit of liability per occurrence and $2,000,000 in the aggregate.
If you’re working with a broker to get a quote, I recommend asking them to quote as an option a $2M occurrence limit.
I find that the price difference to double your protection here is pretty affordable and makes sense.
Property Coverage
Here you’re going to purchase protection on the tools, equipment, supplies, and other personal property stored in your office, shop, or home office.
Tools and equipment stored in your trucks are commonly insured separately on an inland marine floater which we’ll cover in a moment.
A quick comment here – if you work out of your home, don’t think that your business property is covered under your homeowner’s policy.
In fact, it’s typically excluded, so you need to cover your business property on your business policy.
Inland Marine
Sometimes this policy is called a tools floater or equipment policy.
The word floater means that the property you’re insuring – tools and equipment is not fixed in any one place, but “floats” around and is mobile.
Business Auto
This is a separate policy from your BOP and insures your commercial vehicles are owned, leased, or used in the business.
Here, we sometimes see plumbing contractors register vans or pick-ups in their personal names and insure these trucks on their personal auto policy. This can be a problem as the name of your business is usually not a named insured on your personal auto policy and in the event of a claim where your business is sued, you won’t have coverage.
Now, some insurance agents will say: “well, the business has hired non-owned auto coverage, so it’s not a problem!”
I don’t agree.
The intent of hired and non-owned auto is to provide the insured protection for temporary short-termed use of vehicles rented, borrowed, or hired.
The other problem that occurs in these situations relates to umbrella coverage discussed next. The last issue with business auto is regarding limits of coverage.
We recommend $1m limits of auto liability protection which is what most umbrella underwriters will require as underlying protection, and when it comes to physical damage consider higher deductibles. When you assume more risk in the form of higher deductibles the costs go down.
Umbrella coverage
Umbrella or excess liability insurance provides extra liability insurance over and above your underlying general liability and auto liability policies – if properly scheduled.
Commonly umbrella coverage is purchased in $1m increments
Do you need it?
I think every plumbing contractor should strongly consider purchasing umbrella protection.
If you’re a small one-person operation your costs will be minimal and for the added protection it’s worth it.
For larger firms that do commercial work, umbrellas are almost always required for your certificate holders, and lately, we’re seeing the demand by your customers to carry $5m, to $10m in limits, so yes, it’s important.
Workers Compensation
If you have employees, you’re required to have workers comp in NY.
You can purchase workers comp directly from the web, or the State Insurance Fund or SIF, there are some SIF safety groups that provide some discounts, or you can package your workers’ comp with the same insurer that covers your BOP and auto insurance.
The advantage here is convenience – one broker or insurer to call for a certificate, one insurer that performs your year-end audits, one billing statement.
Plumbers have a lot of options when it comes to workers comp in NY.
Again it comes down to price and getting the coverage right.
I have seen too many instances of plumbing contractors who purchased what they think is the best plumbers insurance coverage directly online and had things fouled up due to miscommunications, or lack of engagement by an expert, so you’ve got to be careful.
Other Options to Consider
Cyber insurance – if your business runs on data, meaning your billing, appointments, and customer lists are stored on a computer, or in the cloud, cyber insurance is a good idea to explore. The cost of cyber insurance is cheap, compared to the broad protection it provides and is critical in today’s world of hackers and ransomware.
Pollution Insurance – depending on what you do, the contractor’s pollution remediation coverage may be worth reviewing and often is mandated by certificate holders in some industrial settings.
Bonding – while technically not a form of insurance, many plumbing contractors may need bid and performance bonding, which we can also assist with.
What Does Plumbers Insurance Cost?
If you do some searches online regarding costs you may see things like basic, standard, custom cost charts that provide a monthly insurance cost for a plumbing contractor. Like $89 per month.
You may also see some online insurance brokers provide median premiums for insurance. The median premium for plumbers is less than $125 per month.
To me, these are unrealistic numbers that don’t really indicate what YOU are going to pay for business insurance.
So, how much does insurance cost for a plumbing contractor?
The answer is going to be based on several rating factors, such as:
The type of plumbing you do. Is it primarily residential or commercial work? Or is it industrial process piping? Or sewer main hookups? All of these different types of plumbing work are charged different rates for both general liability and worker’s compensation insurance.
Geography – typically plumbers working predominantly in the 5 Boros will pay more than a firm working in Westchester or Rockland Counties.
The number of employees and payroll are the rating basis for general liability and workers compensation so the larger your payroll, the more premium you’ll pay.
The number of trucks you insure.
Limits of coverage and deductibles you choose.
Your claims history. Plumbers with no claims will pay less than a similar plumbing company with several claims in the last 5 years.
How do you save money on your plumbing insurance or find the best plumbers insurance?
Good question.
Keep accurate records and make sure that your employees are characterized properly for payroll purposes.
If you do several types of plumbing and contracting operations be sure that each project and employee is characterized properly.
Next, as I mentioned earlier, the better job you can do to have fewer claims, the better off you’ll be.
That means having a solid risk control and safety program. If you don’t have one or don’t know where to start with a safety plan, we can help here with a deep library of risk management resources.
Related to risk control is a driver selection process, and ongoing monitoring of the MV process is also important to be sure that your drivers exhibit good driving characteristics on and off the job.
Lastly, speak to your broker about 3 months prior to your policy renewal dates to see what their opinion of the marketplace is.
We don’t recommend shopping your account out every year –
in fact, this will have negative consequences on your pricing over the long term, but it does make sense to evaluate this every three years or so to be sure you’re insured with the right insurance company.
Here’s the bottom line when it comes to insurance for plumbers.
Now more than ever you have a wide variety of choices when it comes to purchasing “the best plumbers insurance.” You can do it yourself online through a variety of websites, which I mentioned earlier is not recommended.
Or you can work with an expert firm who has the team to answer questions, issue certificates quickly, and give you advice when you need it.
In most cases, that expert broker is not going to cost you more than doing it yourself, so why add the hassle and burden of thinking through all those choices when you’ve got enough on your plate?
If you choose to work with a broker like me, you’re going to want to find someone who represents a wide variety of insurers that can offer you choice, and have the resources as I mentioned earlier to provide advice on managing risk, safety, and compliance.
By the way, we have all those things!
If you have any other questions, issues or thoughts you’d like to talk with me about. Please reach out. Just click below to get started.
Thanks!
