Contractors discussing budget plans in the office.

How to Know if You’re Overpaying for Your Contractors Coverage


As a contractor, it’s important to carry adequate insurance coverage to protect your business from unexpected events and to fulfill your clients’ requirements. At the same time, you don’t want to pay too much. In fact, many contractors are unaware that they might be overpaying for the coverage they have and may not be getting the best coverage for their business needs.

Why? Because you’re expected to carry certain types of insurance, and you might not have gotten the best deal.

Standard Insurance Coverage for Contractors

Contractors must carry a range of insurance policies, and while this list isn’t exhaustive, it gives you an idea of how robust your insurance portfolio should be:

  • Liability Insurance: Protects your business against legal claims that arise from damage to property or injury to others while on the job.
  • Workers’ Compensation: Covers medical expenses and lost wages for employees who are injured on the job.
  • Commercial Auto Insurance: Covers vehicles used for business purposes and provides liability coverage in the event of an accident.
  • Environmental Liability: Protecting your business against claims that you’ve polluted the local environment of broken local or federal regulations.
  • Commercial Property Insurance: Protecting your facility and any items contained therein.
  • Builder’s Risk: A builder’s risk policy protects products on the worksite, tools left on the worksite, incomplete projects, and even complete projects in some cases.

3 Ways to Cut Business Insurance Costs

Cutting costs is just as Important as buying insurance. But what can you do to save money in the long-term? Use these three tips to cut your overhead and make certain that your business is protected.

  • Bundle policies: You can save money by purchasing multiple policies from the same insurance company.
  • Increase your deductible: Increasing your deductible can lower your premium, but you must balance this move with the ability to pay or absorb the deductible.
  • Shop around: Compare quotes from different insurance companies to ensure you are getting the best coverage for the best price. Working with independent agents at Liberty Arizona is quite helpful.
  • Trim coverage you don’t need: There are times when you may not need certain coverages because they don’t impact your business as much as others. Ask you’re agent how to drop coverages you don’t truly need or how they may overlap with other insurance products.

Business Insurance Coverage You Can’t Skimp On

While you may want to save money, remember that you cannot skimp on every insurance policy. These coverages are worth the money because they protect you from massive losses, liens, judgments, settlements, fines, and more.

  • Liability Insurance: This is a critical coverage for contractors as it protects against potential lawsuits. You may even want to invest in umbrella coverage so that your limits are in line with average claims in your industry.
  • Workers’ Compensation: Failing to carry this coverage can result in severe financial penalties. Plus, you will be liable for all work-related accidents and illnesses.
  • Equipment Coverage: This coverage protects your business’s equipment, which is often expensive to replace. Equipment insurance is especially helpful if you often rent equipment and don’t want to pay for replacements.

Annual Reassessment of Contractor’s/Business Insurance

It is important to reassess your business model and coverage needs every year. Speak to an insurance agent and make sure you have scaled your coverage properly. Blindly renewing insurance policies can result in insufficient coverage and missed cost-saving opportunities.

Contact Liberty Arizona for Help With Insurance for Contractors

At Liberty Arizona, we can help you write new insurance, review your existing coverage, and provide access to the best insurance carriers on the market. Contact us today to see how we can help you save money on your contractors coverage.

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