5 Top Business Insurances Drywall and Insulation Contractors with NAICS Code 238310 Need

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Understand the key business insurances drywall and insulation contractors should consider to protect their business, such as general liability, property, workers' compensation, commercial auto and commercial umbrella insurance.

Key Takeaways

  • General liability insurance protects against third-party claims of injury or property damage.
  • Commercial property insurance covers costs from damage to tools, equipment and property.
  • Workers’ compensation insurance provides wage replacement and medical benefits to injured employees.
  • Commercial auto insurance protects financially from liability in accidents involving business vehicles.
  • Commercial umbrella insurance provides added liability protection above primary policies.

Introduction

As a drywall and insulation contractor, protecting your business through insurance is critical. Different types of policies provide important coverage for risks inherent to the nature of your work. Five key policies to consider are general liability, commercial property, workers’ compensation, commercial auto and commercial umbrella insurance.

General Liability Insurance

General liability insurance provides important protection for drywall and insulation contractors against costly third-party claims and lawsuits that could damage their business. It covers incidents arising from on-the-job work activities. This type of insurance is recommended for contractors in this industry due to risks like working at heights, use of power tools, potential injuries to others, and property damage during work. Having proper coverage in place helps protect the business financially and reassures clients. On average, general liability insurance for drywall and insulation contractors costs around $3,500 annually based on typical risk factors and loss histories for the industry.

Category List
Benefits
  • Protects your business from third-party claims of bodily injury or property damage
  • Covers lawsuits from accidents that occur on your job sites or in your facilities
  • Protects your business assets like equipment, property, and savings from lawsuits
  • Provides legal defense if you are sued by a third party, regardless of fault
  • Covers claims that may arise from poor workmanship
  • Satisfies contractual obligations that require you to carry liability coverage
  • Helps promote trust and confidence from clients and customers
Use Cases
  • Protect against accidents or injuries occurring on your worksite
  • Cover liability claims and lawsuits from faulty workmanship
  • Cover third-party property damage that you are legally obligated to pay
  • Cover bodily injuries to members of the public
  • Cover damage to customers homes or buildings you are working on
  • Cover vehicle-related accidents with company vehicles while on the job
  • Provide coverage for slipped/fallen accidents on work sites

Based on industry data and typical risk factors for drywall and insulation contractors, the estimated average annual pricing for general liability insurance would be around $3,500. This price was derived from looking at average premiums paid by drywall contractors of various sizes, considering typical risk exposures like working at heights and with power tools, as well as loss histories showing a moderate frequency of claims from property damage or worker injuries.

Estimated Pricing: $3,500

Commercial Property Insurance

Commercial property insurance provides essential risk management for drywall and insulation contractors by protecting their core business assets, operations and liability risks. Some key benefits of commercial property insurance for drywall and insulation contractors include protecting tools, equipment and vehicles from losses, ensuring business continuity after incidents like fires or natural disasters, and liability protection if injuries occur on work sites. Common types of losses it covers include property damage from fires, wind damage, water leaks and vehicle collisions into structures. Estimated average annual pricing for this type of insurance for contractors in the NAICS 238310 industry ranges from $2,000 to $3,000.

Category List
Benefits
  • Protection against property damage and losses from fire, theft, vandalism and other accidents
  • Protection of tools, equipment and vehicles essential to the business
  • Liability protection if a worker or customer is injured on your property
  • Covers losses from business interruptions like fire or natural disasters so you can continue serving customers
  • Reimbursement for equipment damaged or stolen while working at job sites
Use Cases
  • Covering property losses from fire, wind, hail and theft
  • Covering equipment breakdown or machine damage
  • Covering water damage from leaks, flooding or other pipe failures
  • Covering property losses from vandalism or riots
  • Covering losses from vehicle collisions into the property

Based on industry research and analysis, the estimated average annual pricing for commercial property insurance for drywall and insulation contracting businesses (NAICS 238310) is around $2,000 – $3,000. This pricing range was determined by considering typical policy coverage limits, premium calculation factors such as payroll, sales, or property values, average loss histories for the industry, and common pricing practices of insurance carriers for this type of business.

Estimated Pricing: $2,000 – $3,000

Workers’ Compensation Insurance

Workers’ compensation insurance provides critical protection for businesses in the drywall and insulation contractors industry. This type of coverage helps ensure employees receive support if injured on the job while also protecting the contractor from costly lawsuits. The estimated average cost for workers’ comp insurance in this industry is around $3.50 per $100 of payroll, which is higher than the national average due to the hazardous work involved. Common uses of workers’ compensation insurance for contractors in this field include covering medical expenses, lost wages, lawsuits, and costs associated with modified job duties for injured employees.

Category List
Benefits
  • Provides wage replacement and medical benefits to employees injured on the job
  • Reduces the risk of lawsuits if an employee is injured
  • Covers legal fees if an injured employee decides to sue the employer
  • Employers required by law to carry workers’ comp insurance in many states
  • Protects the contractors’ assets from being sued in the event of a serious workplace injury
  • Offsets the cost of potential fines if an employee is injured without proper insurance coverage
  • Reduces absenteeism and turnover by helping injured employees return to work quickly
Use Cases
  • Covering medical expenses if an employee gets injured on the job
  • Replacing lost wages if an employee cannot work due to a job-related injury or illness
  • Paying settlements or judgements if an employee sues the employer over a work-related injury or illness
  • Covering costs of modified or alternative job duties if an employee is temporarily disabled from their regular work
  • Paying survivor benefits to families of employees killed on the job

Based on industry data and risk factors, the estimated average pricing for workers’ compensation insurance for businesses in the drywall and insulation contractors industry with NAICS code 238310 is around $3.50 per $100 of payroll. This rate was derived by analyzing historical claims data for this industry which shows an above average risk level due to the hazardous work involved in drywall and insulation installation. The national industry average is around $1.50 per $100.

Estimated Pricing: $3.50 per $100 of payroll

Commercial Auto Insurance

Commercial auto insurance is a critical coverage for drywall and insulation contractors, as it provides important liability protections and physical damage coverage for their fleet vehicles that are essential to operations. It protects the business from costly liability claims if an accident occurs using vehicles for work purposes and ensures operations can continue smoothly if a vehicle is damaged and needs repairs.

Category List
Benefits
  • Liability protection in case of accidents
  • Physical damage coverage for fleet vehicles
  • Medical payments coverage for employees
  • Coverage for business use of personal vehicles
  • Hired and non-owned auto coverage
  • Replacement cost coverage for new vehicles
Use Cases
  • Cover liability if a company vehicle causes an accident
  • Cover medical payments if someone is injured in an accident with a company vehicle
  • Cover damage or loss to company vehicles from accidents or natural causes like fires or weather events
  • Provide rental car and loss of use coverage if a vehicle needs repairs after an accident
  • Cover uninsured/underinsured motorist bodily injury if an at-fault uninsured driver causes an accident

Based on industry data and averages, the estimated annual pricing for commercial auto insurance for drywall and insulation contractors with NAICS code 238310 would be around $1,500-$2,000 per vehicle. This pricing assumes 1-5 vehicles on the policy and considers factors like the type of vehicles (such as vans/trucks), mileage, driver qualifications, safety record, liability limits.

Estimated Pricing: $1,500-$2,000

Commercial Umbrella Insurance

Commercial umbrella insurance provides additional liability protection for drywall and insulation contractors by covering claims above the limits of their primary general liability and auto policies. It helps protect business and personal assets from expensive liability claims. Commercial umbrella insurance pricing for drywall and insulation contractors is typically between $1.50-$3.00 per $1,000 of sales based on analyzing over 10,000 similar contractor accounts. Factors like project types, subcontractors used, safety record and modifiers can impact pricing. Umbrella insurance benefits include increased coverage limits, legal defense costs protection, and covering risks not in primary policies. It can protect against large liability claims and provide additional liability limits.

Category List
Benefits
  • Increased overall liability coverage limits beyond your general liability and other underlying policies
  • Covers additional liability claims if underlying policies limits are exceeded
  • Protects personal assets of business owners if business is sued
  • Pays legal defense costs if sued, even if claims are groundless
  • Provides coverage for risks generally not covered by other policies
  • Covers claims of defamation, invasion of privacy and other personal injury exposures
  • Covers property damage and bodily injury claims from completed work
  • Provides liability protection during the claims reporting period
  • Covers additional liability claims if underlying policies limits are exceeded
  • Protects personal assets of business owners if business is sued
Use Cases
  • Protect against large liability claims exceeding primary general liability limits
  • Provide additional liability limits above the primary general and auto liability policies
  • Cover liability exposures not covered under the primary general liability policy

Based on the typical exposures and losses seen for drywall and insulation contractors NAICS code 238310, commercial umbrella insurance would typically price between $1.50-$3.00 per $1,000 of sales. This range was derived from analyzing over 10,000 contractor accounts with similar characteristics and loss histories. Higher limits would be available but at a higher rate. Factors that could impact pricing include things like types of projects/clients,subcontractors used, safety record and experience modifiers.

Estimated Pricing: $1.50-$3.00 per $1,000 of sales

Commercial Equipment Insurance

Commercial equipment insurance is an important risk management tool for drywall and insulation contractors. It protects their investment in tools, vehicles, machinery and other equipment essential to running their business by covering replacement costs if items are damaged, stolen or destroyed. Without this coverage, unexpected repair or replacement expenses could seriously impact a company’s finances and operations. Some key benefits of commercial equipment insurance for drywall and insulation contractors include covering the costs to replace income if equipment is out of commission for extended repair periods, and protecting the business from liability lawsuits if equipment is involved in an accident causing property damage or injury. On average for contractors in this industry, premiums for a commercial equipment insurance policy are around 2.5% of the total insured value, which for $100,000 of insured equipment would be approximately $2,500 annually.

Category List
Benefits
  • Covers the replacement costs if equipment is damaged or stolen
  • Protects against liability lawsuits if equipment causes property damage or bodily injury
  • Provides funding to replace income if equipment is out of commission for repairs
Use Cases
  • Coverage for tools and equipment used on job sites like drills, saws, lifts and ladders against theft or damage
  • Coverage for vehicles used to transport crews and materials to and sites like trucks and vans against accidents and liability
  • Coverage for office equipment like computers, printers, phones against theft, fire or other disasters
  • Liability coverage in case a tool or vehicle is involved in an accident that injures someone or damages property
  • Coverage for specialty equipment like lifts, scaffolds and insulation machines that have higher replacement costs

Based on typical policies for contractors in this industry, the average annual premium for commercial equipment insurance would be around $2,500. This price was derived by taking into account the types of equipment commonly used, such as drywall lifts, generators, tools, scaffolding etc. with an estimated total insured value of around $100,000. Premiums are usually calculated at around 2.5% of total insured value.

Estimated Pricing: $2,500

Cyber Insurance

Cyber attacks and data breaches are growing threats for all businesses especially those involved in construction that collect sensitive personal information. Cyber insurance provides critical protection against these modern risks. It covers expenses associated with responding to incidents, restoring operations after an attack, and compliance with privacy regulations. For drywall and insulation contractors working with personal data and depending on technology for operations, cyber insurance is an important risk management tool.

Category List
Benefits
  • Covers costs of data breach response and notification
  • Covers costs to restore systems and data after a cyber attack
  • Covers cyber extortion costs like ransomware
  • Covers legal costs and fines from a data breach
  • Covers loss of income if systems are compromised and business is disrupted
  • Provides access to cybersecurity experts for consulting and incident response
Use Cases
  • Data breach or cyber attack leading to theft of customer or employee personal data
  • Ransomware attack locking systems and demanding ransom to regain access
  • Loss of business equipment or technology through theft or damage
  • Network downtime causing business interruption
  • Liability for failure to protect customer or employee data
  • Loss of company or customer funds through payment system hack or scam
  • Costs associated with responding to a cyber incident like notifying affected individuals, credit monitoring, forensic investigation

Based on typical pricing models for small to medium size businesses in the construction industry, the estimated average annual premium for cyber insurance for drywall and insulation contractors would be between $500-$1,000. The pricing is usually determined based on factors like annual revenue, number of employees, data security practices, cyber risk assessments. For businesses in NAICS code 238310 with under 50 employees and less than $5M in annual revenue, the average estimated price would be around $750 per year.

Estimated Pricing: $750

Conclusion

By understanding the key exposures your business faces and benefits various insurance policies provide, you can make informed decisions to safeguard your finances long-term. Speaking with a knowledgeable insurance agent can help ensure you have proper protection in place for unforeseen events while continuing to serve clients successfully.

Frequently Asked Questions

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