Property Preservation Insurance

Several factors affect insurance premiums for property preservation contractors during the underwriting process, such as:

• Type of services: Insurers will review the services you offer, such as maintaining vacant commercial properties, winterizing residential properties, or removing debris.
• Business property: Expect to pay more to insure a large office or expensive landscaping equipment than basic supplies.
• Annual revenue: Higher revenue often brings greater exposure to liability claims and larger potential losses, which increases your insurance rates.
• Business location: Insurance costs can vary based on property values, litigation trends, crime rates, and the cost of doing business in your region.
• Coverage limits and deductibles: Higher policy limits generally increase premiums, while choosing a higher deductible can lower them.
• Claims history: Contractors with previous insurance claims may pay higher rates than those with a clean history of claims.
• Number of employees: A larger workforce increases the cost of workers' comp and other policies, as each employee brings the risk of an injury or accident.

Depending on your location, you may need to obtain a contractor's license from a state licensing board or local governing body before you accept your first job in property preservation. Some regions require insurance or a bond as part of their licensing requirements.

The type of license you need depends on the work you do, such as plumbing, electrical work, or debris removal. You might also need a permit for a specific project, especially if it involves structural changes.

Clients may ask to see proof of insurance or a license before they'll hire you. Being insured, bonded, and licensed shows your business is reputable and gives your customers peace of mind, which is especially helpful when you're working to attract clients to a new business.

Property preservation contractors typically need insurance to operate legally and sign contracts, but the specifics depend on your location and the services you offer.

Here are the insurance policies you likely need to run your business:

• General liability insurance covers accidental bodily injuries and property damage that impact clients and other third parties. You might need proof of liability insurance to rent a commercial space, sign a client contract, or obtain a license. Property owners and others may ask to be included in your liability policy as an additional insured endorsement.
• Professional liability insurance, or E&O insurance, covers accusations of professional negligence, including mistakes and missed appointments. Property preservation contractors often need E&O coverage to sign contracts with clients, and it's required in some states for licensed real estate professionals and contractors.
• Workers' compensation insurance is required in most states, including New York and California, for employees and occasionally for solo contractors. It pays for medical treatment if you're injured on the job and provides disability benefits during recovery.
• Commercial auto insurance covers accidents involving business vehicles. Almost every state requires this coverage for vehicles owned by a business.

Commercial insurance provides crucial financial protection for every property preservationist, even when it's not required. It can help pay for catastrophic water damage and liability costs if you miss a hidden pipe leak, fail to properly drain a system before winter, or make other oversights in property maintenance.

In addition to the policies mentioned above, property preservation contractors should consider the following:

• Commercial property insurance covers your building and its contents, such as tools, furnishings, and computers. It protects against financial losses from fires, storms, and burglaries.
• Equipment breakdown insurance helps pay to repair or replace machinery that your business depends on, such as a sump pump or furnace that fails unexpectedly.
• Business interruption insurance, also called business income insurance, reimburses you for lost income and day-to-day expenses if your business is forced to close temporarily due to a fire or other covered property claim.
• Cyber insurance helps property preservation companies recover financially after a data breach or cyberattack. It's recommended for any business that stores client information.
• Commercial umbrella insurance boosts the coverage on your general liability, commercial auto, or employer's liability insurance once the policy limit is reached.

Property preservation contractors can save money on insurance by comparing quotes from different providers. With Insureon, you can get free quotes from top-rated insurance companies by filling out our easy online application.

Other ways to save money include:

• Bundle policies. Contractors can often buy general liability coverage and commercial property insurance together in a business owner's policy, which costs less than buying these policies separately.
• Customize your coverage. Choose lower limits or a higher deductible to reduce your premium, but make sure your policy can still cover a potential claim and that you can afford to pay the deductible in a crisis.
• Avoid accidents and claims. You can prevent employee injuries and client accidents that lead to claims by implementing a strong risk management strategy that includes employee training and strict enforcement of safety protocols.

Insureon's licensed agents can help you find the right insurance solutions for your business needs, whether your focus is home winterization, foreclosures, or commercial properties. Our flexible payment plans let you pay monthly or annually to fit your business's budget.