new york contractor insurance
As a contractor in New York, you face unique challenges and risks every day. Whether working on a high-rise in Manhattan, a residential renovation in Brooklyn, or infrastructure projects in upstate New York, having the right insurance coverage is crucial. Blake Insurance Group specializes in helping contractors like you protect your business, your employees, and your livelihood.
Contractor insurance is not just a regulatory requirement; it’s a vital safeguard against the unexpected. The right insurance can mean the difference between a minor setback and a major financial disaster, from accidents on the job site to property damage and liability claims. In this guide, we’ll explore the various types of contractor insurance available, why they are essential for your business, and how Blake Insurance Group can assist you in securing comprehensive coverage tailored to your specific needs.
Navigating the complexities of contractor insurance can be daunting, but you don’t have to do it alone. Our team of experienced independent insurance agents is dedicated to providing personalized service and expert advice, ensuring you have the protection to focus on what you do best—building and maintaining the structures that keep New York thriving.
Types of Insurance Coverage for General Contractors
General Liability Insurance
General Liability Insurance is fundamental for any contractor. It covers bodily injury, property damage, and personal and advertising injury that might occur during operations. In New York, the minimum
Workers’ Compensation Insurance
Workers’ Compensation Insurance is mandatory for all businesses with employees in New York. It covers medical expenses and lost wages for employees injured or ill due to their jobs. This ensures that your employees are taken care of and protects your business from potential lawsuits related to workplace injuries.
Commercial Auto Insurance
If your business uses vehicles, Commercial Auto Insurance is essential. This policy covers bodily injury and property damage from vehicle accidents, theft, vandalism, and weather-related damage. It is crucial for contractors who rely on trucks, vans, or other vehicles to transport tools and materials.
Builder’s Risk Insurance
Builder’s Risk Insurance protects buildings and structures under construction. It covers damage from fire, theft, vandalism, and certain weather events. This policy is crucial for ensuring that your investment in a construction project is protected from unforeseen events that could cause significant financial loss.
Professional Liability Insurance (Errors and Omissions)
Professional Liability Insurance, or Errors and Omissions Insurance, is essential for contractors who provide design or consulting services. This policy covers legal fees and damages if you are sued for mistakes or negligence in your professional services. It’s vital for design-build firms and contractors involved in complex projects.
Umbrella/Excess Liability Insurance
Umbrella or Excess Liability Insurance provides additional coverage beyond the limits of your General Liability, Commercial Auto, and Workers’ Compensation policies. This extra layer of protection is crucial for contractors working on large projects or in high-risk environments where potential claims could exceed standard policy limits.
Tools and Equipment Insurance
Tools and Equipment Insurance covers the repair or replacement of your tools and equipment if they are damaged, lost, or stolen. This policy is vital for contractors who rely on expensive tools and machinery to complete their work. It ensures that your operations can continue smoothly without significant financial disruption.
Surety Bonds
Surety Bonds guarantees that you will fulfill your contractual obligations. If you fail to complete a project as agreed, the bond provides financial compensation to the client. Common types of surety bonds include bid, performance, and payment bonds.
Pollution Liability Insurance
Pollution Liability Insurance covers claims related to environmental damage caused by your operations. This is particularly important for contractors working with hazardous materials or in industries where environmental impact is a concern.
Legal Requirements and Compliance for Contractor Insurance in New York
General Liability Insurance
General Liability Insurance is a fundamental requirement for contractors in New York. This insurance covers bodily injury, property damage, and personal and advertising injury that might occur during operations. The minimum coverage typically required is $1 million per occurrence and $2 million aggregate.
Workers’ Compensation Insurance
Workers’ Compensation Insurance is mandatory for all businesses with employees in New York. This insurance covers medical expenses and lost wages for employees injured or ill due to their jobs. It ensures that employees are taken care of and protects the business from potential lawsuits related to workplace injuries.
Commercial Auto Insurance
If a business uses vehicles, Commercial Auto Insurance is essential. This policy covers bodily injury and property damage from vehicle accidents, theft, vandalism, and weather-related damage. The minimum limit is typically $1 million per accident.
Builder’s Risk Insurance
Builder’s Risk Insurance protects buildings and structures under construction. It covers damage from fire, theft, vandalism, and certain weather events. This policy is crucial for ensuring that investments in construction projects are protected from unforeseen events that could cause significant financial loss.
Professional Liability Insurance (Errors and Omissions)
Professional Liability Insurance, or Errors and Omissions Insurance, is essential for contractors who provide design or consulting services. This policy covers legal fees and damages if sued for mistakes or negligence in professional services. It is vital for design-build firms and contractors involved in complex projects.
Umbrella/Excess Liability Insurance
Umbrella or Excess Liability Insurance provides additional coverage beyond the limits of General Liability, Commercial Auto, and Workers’ Compensation policies. This extra layer of protection is crucial for contractors working on large projects or in high-risk environments where potential claims could exceed standard policy limits.
Tools and Equipment Insurance
Tools and Equipment Insurance covers repairing or replacing tools and equipment if damaged, lost, or stolen. This policy is vital for contractors who rely on expensive tools and machinery to complete their work.
Surety Bonds
Surety Bonds guarantee that contractors will fulfill their contractual obligations. If a contractor fails to complete a project as agreed, the bond provides financial compensation to the client. Common types of surety bonds include bid, performance, and payment bonds.
Pollution Liability Insurance
Pollution Liability Insurance covers claims related to environmental damage caused by operations. This is particularly important for contractors working with hazardous materials or in industries where environmental impact is a concern.
Compliance Requirements
Policy Forms and Limits
Unless otherwise specified, all policies must be written on an occurrence basis. The types of coverage and policy limits required are detailed in the contract documents.
Certificates of Insurance
Contractors must provide Certificates of Insurance in a form satisfactory to the relevant New York State office (e.g., ITS, OGS). These certificates must reference the contract number and name the appropriate New York State office as the certificate holder. They must also disclose any deductibles, self-insured retentions, aggregate limits, or exclusions that materially change the coverage required by the contract.
Additional Insured and Waiver of Subrogation
Contractors must include a waiver of the insurer’s right to recovery or subrogation against the State, ITS, and any authorized entities. Additionally, policies must name the State of New York and relevant entities as additional insureds using specific ISO forms or equivalent coverage.
Notice of Cancellation or Non-Renewal
Policies must include requirements for notice of cancellation or non-renewal under New York State Insurance Law. Contractors must provide proof of replacement coverage that complies with the insurance requirements if any notice of cancellation or non-renewal is received.
Subcontractor Compliance
Contractors must ensure that subcontractors procure and maintain the required insurance policies. An Additional Insured Endorsement evidencing such coverage must be provided before a subcontractor commences work.
Cost Factors for Contractor Insurance in New York
**Business Type and Risk Level**
– **Higher Risk Businesses:** Companies with a higher risk of third-party injury or property damage, such as roofing companies, will pay more for General Liability (GL) insurance than lower-risk businesses like landscaping companies.
– **General Liability Insurance:** The average cost for general contractors is around $142 per month, or $1,700 annually.
**Policy Limits and Coverage Types**
– **General Liability Policy Limits:** Typical limits for small companies are $1 million per occurrence and $2 million aggregate. Higher limits or adding an umbrella policy will increase the cost.
– **Business Owner Policy (BOP):** A BOP, which includes GL, business property, and business interruption coverage, will cost more than a GL-only policy.
**Equipment and Tools**
– **Scheduled Equipment:** High-value equipment like backhoes and excavators need to be added as “scheduled” equipment, which increases the premium.
– **Unscheduled Equipment:** Collections of small tools under $5,000 to $10,000 are typically added to a BOP under a package endorsement. Collections over $10,000 can be added as unscheduled or written on a separate Inland Marine policy.
**Commercial Auto Insurance**
– **Vehicle Type and Number:** The cost varies depending on the type and number of vehicles, coverage amount, business type, and drivers’ driving records.
– **Average Cost:** General contractors spend an average of $180 per month, or $2,157 annually, for commercial auto insurance.
**Workers’ Compensation Insurance**
– **Employee Wages and Business Type:** The cost depends on the total wages paid to employees and the business type. Higher-risk jobs like roofing will have higher premiums.
– **Average Cost:** The median annual cost for general contractors in New York is $4,799, significantly higher than the national median of $3,682.
**Professional Liability Insurance (Errors and Omissions)**
– **Coverage for Design and Consulting Services:** This insurance covers legal fees and damages if sued for mistakes or negligence in professional services.
– **Average Cost:** Construction businesses and contractors pay an average of $74 per month or $886 annually.
**Builder’s Risk Insurance**
– **Coverage for Construction Projects:** This insurance covers damage to buildings and structures under construction from fire, theft, vandalism, and certain weather events.
– **Average Cost:** General contractors pay an average of $134 per month or $1,608 annually.
**Umbrella/Excess Liability Insurance**
– **Additional Coverage:** This policy provides extra coverage beyond the limits of GL, commercial auto, and workers’ compensation policies.
– **Average Cost:** The cost varies but is generally higher for contractors working on large projects or in high-risk environments.
**Surety Bonds**
– **Guarantee of Contract Fulfillment:** Common types include bid, performance, and payment bonds.
– **Average Cost:** The average cost of a surety bond is $10 per month, or $125 annually.
Average Premiums for Contractor Insurance in New York
– **General Liability Insurance:** $142 monthly, or $1,700 annually.
– **Builder’s Risk Insurance:** $134 per month, or $1,608 annually.
– **Workers’ Compensation Insurance:** $4,799 annually.
– **Professional Liability Insurance:** $74 per month, or $886 annually.
– **Commercial Auto Insurance:** $180 monthly, or $2,157 annually.
– **Surety Bonds:** $10 per month, or $125 annually.
Comparison of the Top Contractors Insurance Companies in New York
| Insurance Company | Key Coverages | Special Features | Target Contractors | Additional Services | Estimated Cost |
|---|---|---|---|---|---|
| Travelers Insurance | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk, Umbrella/Excess Liability, Environmental Liability, Professional Liability | IndustryEdge® tailored products, Risk Control, Construction Claim Services | General contractors, highway, street, and road contractors, millwright contractors, tile and flooring contractors | CyberRisk, Contract Surety, Management and Professional Liability, Construction Resources | General Liability: $142/month, Workers' Comp: $400/month, Commercial Auto: $180/month |
| Main Street America Insurance | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk, Umbrella/Excess Liability, Business Owners Policy (BOP) | Customizable small business solutions, Main Line BOP, Identity Theft coverage | Small and medium-sized businesses, including contractors, carpentry, masonry, painting, landscaping, electrical work | Cyber Insurance, Equipment Breakdown, Employment Practices Liability Insurance | General Liability: $150/month, Workers' Comp: $450/month, Commercial Auto: $200/month |
| American Empire Insurance Company | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk, Umbrella/Excess Liability | High-risk construction insurance, no height limits | High-hazard industries such as roofing, scaffolding, environmental remediation | Specialized underwriting solutions | General Liability: $160/month, Workers' Comp: $500/month, Commercial Auto: $220/month |
| Markel | General Liability, Pollution Liability, Professional Liability | Creative underwriting solutions, broad coverage for environmental contractors | Environmental contractors, hazardous materials industries | Risk management services | General Liability: $155/month, Workers' Comp: $480/month, Commercial Auto: $210/month |
| Chubb | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk, Umbrella/Excess Liability | Strong financial stability, comprehensive risk management services | General contractors, design-build firms | Cyber Insurance, Management and Professional Liability | General Liability: $170/month, Workers' Comp: $520/month, Commercial Auto: $230/month |
| The Hartford | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk | Tailored coverage options, strong customer service | General contractors, small and medium-sized businesses | Risk management services, Cyber Insurance | General Liability: $145/month, Workers' Comp: $460/month, Commercial Auto: $190/month |
| Farmers Insurance | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk | Customizable coverage options, strong customer service | General contractors, small and medium-sized businesses | Cyber Insurance, Equipment Breakdown | General Liability: $140/month, Workers' Comp: $440/month, Commercial Auto: $185/month |
| Admiral Insurance Company | General Liability, Workers' Compensation, Commercial Auto, Builder's Risk, Umbrella/Excess Liability | Broad coverage forms, reasonable pricing | High-risk contractors, roofing, scaffolding | Specialized underwriting solutions | General Liability: $165/month, Workers' Comp: $510/month, Commercial Auto: $225/month |
| Gotham Insurance Company | General Liability, Umbrella Liability | Unique rating basis on the number of new homes, tailored coverage for residential contractors | Residential general contractors | Risk management services | General Liability: $150/month, Workers' Comp: $470/month, Commercial Auto: $200/month |
| Merchants Mutual | General Liability, Workers' Compensation, Commercial Auto | Hands-on approach, understanding of upstate contractors' needs | General contractors, small and medium-sized businesses | Risk management services | General Liability: $145/month, Workers' Comp: $450/month, Commercial Auto: $195/month |
**Travelers Insurance**
Travelers Insurance is a well-established company offering a wide range of insurance products tailored to contractors’ needs. These include General Liability, Workers’ Compensation, Commercial Auto, Builders’ risk, and Umbrella/Excess Liability Insurance. Travelers is known for its comprehensive coverage options and risk management services, making it a reliable choice for contractors of all sizes.
**Main Street America Insurance**
Main Street America Insurance, a subsidiary of AMFAM, Incorporated, provides customizable insurance solutions for small and medium-sized businesses, including contractors. Their products include Business Owners Policy (BOP), General Liability, Commercial Auto, Workers’ Compensation, and Commercial Umbrella Insurance. Main Street America is known for its financial stability and broad coverage options, making it a preferred choice for contractors in various trades.
**American Empire Insurance Company**
American Empire Insurance Company specializes in high-risk construction insurance, offering comprehensive coverage for contractors in high-hazard industries such as roofing, scaffolding, and environmental remediation. They are known for their financial stability and ability to provide coverage with no height limits, making them a top choice for contractors working on large and complex projects.
**Markel**
Markel is a reputable insurance company offering specialized coverage for environmental contractors, including General Liability and Pollution Liability. They are known for their creative underwriting solutions and ability to provide comprehensive coverage tailored to the unique risks faced by contractors in the environmental sector. Markel’s financial stability and broad coverage options make them a reliable choice for contractors dealing with hazardous materials.
**Chubb**
Chubb is a global insurance company known for its extensive range of products and services. For contractors, Chubb offers General Liability, Workers’ Compensation, Commercial Auto, Builders’ risk, and Umbrella/Excess Liability Insurance. Chubb is recognized for its strong financial stability and comprehensive risk management services, making it a trusted contractor partner.
**The Hartford**
The Hartford provides a variety of insurance products for contractors, including General Liability, Workers’ Compensation, Commercial Auto, and Builders’ risk Insurance. It is known for its customer service and tailored coverage options designed to meet contractors’ specific needs. The Hartford’s financial strength and commitment to risk management make it a solid choice for contractors seeking reliable insurance coverage.
**Farmers Insurance**
Farmers Insurance offers contractors a range of insurance products, including General Liability, Workers’ Compensation, Commercial Auto, and Builders’ risk Insurance. It is known for its customizable coverage options and strong customer service. Farmers Insurance is a well-established company with a reputation for providing contractors with reliable and comprehensive insurance solutions.
**Admiral Insurance Company**
Admiral Insurance Company specializes in providing comprehensive coverage for high-risk contractors, including those in the roofing and scaffolding industries. It offers broad coverage forms and reasonable pricing, making it a preferred choice for contractors working on high-risk projects. Admiral’s financial stability and ability to provide tailored coverage solutions make it a reliable partner for contractors.
**Gotham Insurance Company**
Gotham Insurance Company offers specialized insurance products for residential general contractors, including General Liability and Umbrella Liability Insurance. They are known for their unique rating based on the number of new homes, which helps contractors budget better and avoid large audit surprises. Gotham’s financial stability and tailored coverage options make it a good choice for residential contractors.
**Merchants Mutual**
Merchants Mutual is a New York-based insurance company offering contractors a range of insurance products, including General Liability, Workers’ Compensation, and Commercial Auto Insurance. They are known for their hands-on approach and understanding of the needs of upstate contractors. Merchants Mutual’s financial strength and comprehensive coverage options make them a reliable choice for contractors in New York.
Frequently Asked Questions (FAQs) Related to Contractors Insurance in New York
- General Liability Insurance: Covers bodily injury, property damage, and personal and advertising injury.
- Workers' Compensation Insurance: Required for all employers to cover medical expenses and lost wages for employees injured on the job.
- Disability Benefits Insurance: Covers off-job injuries and illnesses of employees.
- Commercial Auto Insurance: Required if the contractor uses vehicles for business purposes.
- Builder's Risk Insurance: Covers damage to buildings and structures under construction.
- Surety Bonds: These bonds guarantee reimbursement for the client if the contractor fails to fulfill the contract terms.