Key Takeaways
- General liability insurance protects against third party claims for bodily injury and property damage.
- Property insurance covers costs to repair or replace buildings and equipment damaged by insured perils like fire or theft.
- Workers’ compensation provides benefits to employees injured on the job.
- Business interruption insurance replaces lost income if operations are disrupted.
- Commercial auto covers vehicles used for company business.
Introduction
As a business operating in the metal heat treating industry, it is important to understand the types of risks your operations face on a daily basis. While providing heat treating services to customers, there are inherent hazards involved from working with hot metals and industrial machinery. To protect both your company and employees financially from losses, this guide will outline the top business insurance policies metal heat treating companies should consider.
General Liability Insurance
“This reference provides useful information about general liability insurance for businesses in the metal heat treating industry, including the key benefits, common use cases, and estimated average annual pricing.”
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Based on industry research and analysis of risk factors, the estimated average annual pricing for general liability insurance for businesses in the metal heat treating industry (NAICS 332811) is around $5,000-$7,000. This pricing range takes into account factors like the manufacturing nature of the business operations, potential risks from working with heavy machinery/equipment, and hazards associated with high heat processes. The pricing was derived from historical insured data and actuarial modeling of expected losses for this industry type.
Estimated Pricing: $5,000-$7,000
Property Insurance
Property insurance offers essential protection for metal heat treating businesses by covering losses, damages and expenses from covered events like fires, equipment failures and more. This allows businesses to continue operating through difficult times and replace invaluable assets. Insuring buildings, equipment, inventory and more is crucial as damages could cripple a company without coverage.
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Based on industry data, the average property insurance pricing for metal heat treating businesses is around $3.50 per $100 of insured value. This pricing takes into account factors like the industry’s risks of fire damages from furnaces and heat treating equipment. Other factors include risk of physical damages to machinery. The pricing was derived from average premiums paid by businesses in this NAICS code over the past 3 years according to insurance rate filings.
Estimated Pricing: $3.50 per $100 of insured value
Workers’ Compensation Insurance
Workers’ compensation insurance provides important protections for both employers and employees in the metal heat treating industry. This type of insurance helps ensure employees receive medical care and compensation if injured on the job, while protecting businesses from expensive liability claims.
Some key uses of workers’ compensation insurance for this industry include covering common injuries from operating machinery, burns from hot metals, inhalation of fumes, lifting heavy loads, and exposure to chemicals. The nature of operations in metal heat treating like high temperatures, hazards, and lifting poses risks covered by this insurance.
On average, the estimated annual pricing per $100 of payroll is $1.35 based on past claims data for this industry.
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Based on reviewing historical data and claims for NAICS code 332811 (Metal Heat Treating), the average annual pricing per $100 of payroll is estimated to be $1.35. This rate was derived by taking the total premiums paid by companies in this industry over the past 3 years and dividing by the total payroll amounts to get an industry wide average rate.
Estimated Pricing: $1.35 per $100 of payroll
Business Interruption Insurance
Business interruption insurance is a crucial product for companies in the metal heat treating industry to protect against loss of revenue and ongoing expenses if their operations are interrupted by an insured event such as fire, equipment failure, natural disasters, or other covered perils. Some key benefits of business interruption insurance for these businesses include covering payroll, rent/mortgage, utilities and other accounts payable during an interruption, helping avoid laying off employees, and providing funds to purchase temporary replacement equipment if specialized processing equipment is damaged. Common causes of interruptions this industry faces include fire, natural disasters, equipment issues, cyber attacks, labor disputes and disease outbreaks. An estimated annual premium for $5 million in revenue and 6 months of coverage is around $20,000 based on typical risks.
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Based on the average revenue and risks for businesses in the metal heat treating industry, the estimated pricing for 1 year of business interruption insurance would be around $20,000. This was calculated based on the industry average annual revenue of around $5 million, with an assumption of needing to cover ongoing costs for 6 months if the business was interrupted. Major risks considered included equipment breakdown, fire, natural disasters.
Estimated Pricing: $20,000
Commercial Auto Insurance
The commercial auto insurance reference provided gives an overview of the top benefits, use cases and estimated pricing for businesses in the metal heat treating industry with NAICS code 332811. It outlines key considerations for choosing commercial auto insurance and how it can help protect operations that involve company vehicles.
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Based on industry research, the average pricing for commercial auto insurance for a small business (1-5 vehicles) in the metal heat treating NAICS 332811 industry is approximately $2000-2500 per year. Pricing is derived based on industry risk level, number of vehicles, years of experience, driving records, safety features/ratings of vehicles. The metal heat treating industry involves operating heavy machinery and transporting of heavy metals/equipment which increases risk level and pricing.
Estimated Pricing: $2000-2500
Conclusion
By choosing the right combination of general liability, property, workers’ compensation, business interruption and commercial auto insurance policies, metal heat treating businesses can gain important financial protections. Having the right insurance in place ensures losses from covered incidents don’t threaten the long-term viability of operations. It also demonstrates responsibility to employees, customers and the community.