Key Takeaways
- General liability insurance protects against injuries to customers and property damage claims.
- Commercial property insurance covers damage to business property, equipment and lost income.
- Commercial auto insurance is needed if using vehicles for business purposes.
- Worker’s compensation covers medical expenses and lost wages for injured employees.
- Errors & omissions protects against claims of professional negligence or mistakes.
- A business owners policy combines several coverages into one affordable policy.
- Commercial umbrella provides additional liability protection above primary policies.
Introduction
As an appliance repair and maintenance business owner, it is important to understand the types of insurance coverage that are relevant for your industry. These include general liability, commercial property, commercial auto, workers’ compensation, errors and omissions, business owners policy, and commercial umbrella insurance. Each type of insurance provides important protections for your business’s assets, employees, operations, and customers.
General Liability Insurance
General liability insurance is an important risk management tool for appliance repair and maintenance businesses. It protects against a variety of liability claims that could threaten the financial well-being of the business. Specifically, it covers legal costs and damages if a customer sues the business for bodily injury or property damage caused by the business’ operations. It also protects business assets if the business is held liable for accidents that happen on worksites or during service calls. Additionally, general liability insurance insures the business against claims alleging product defects or faulty workmanship related to appliances serviced by the business.
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Based on industry data and average claims, the estimated annual pricing for general liability insurance for appliance repair and maintenance businesses is around $1,250 – $2,500 per year. Pricing can vary depending on factors like number of employees, annual revenue, claims history, and ownership structure. This price range was determined by analyzing typical premiums reported for small businesses in this industry.
Estimated Pricing: $1,250 – $2,500
Commercial Property Insurance
Commercial property insurance is an essential coverage for appliance repair and maintenance businesses. It protects physical assets, inventory, equipment and income from unforeseen disasters or accidents that could damage the business. Commercial property insurance also reimburses lost income if the business needs to temporarily close due to a covered loss and covers extra expenses to continue operations if the property is damaged.
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Based on typical commercial property insurance pricing models and risk profiles, appliance repair and maintenance businesses are usually considered medium risk. Their premiums tend to range between $1.50 to $2.50 per $100 of insured property value. For a small appliance repair shop with $100k of equipment, furnishings and inventory, estimated annual commercial property insurance premium would be around $1,500 to $2,500. Price can vary depending on business location, protection plans selected, loss history and other optional coverages.
Estimated Pricing: $1,500 to $2,500
Commercial Auto Insurance
Commercial auto insurance is a crucial coverage for appliance repair businesses. It protects vehicles used for service calls and transportation while also limiting liability risks from accidents. Top benefits include liability protection, medical payments coverage, and compensation for repair/replacement costs. Key uses involve coverage for accidents while driving between jobsites and protection for technician injuries. Pricing typically falls between $1,500-$2,000 annually per vehicle.
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Based on industry data, the average estimated pricing for commercial auto insurance for appliance repair and maintenance businesses (NAICS Code: 811412) is around $1,500 – $2,000 annually per vehicle. This pricing assumes one to three vehicles on the policy with standard coverage including bodily injury, property damage, uninsured/underinsured motorist coverage. The pricing would vary depending on factors like number of vehicles, driver experience, accidents/tickets on record, coverage limits.
Estimated Pricing: $1,500 – $2,000
Worker’S Compensation Insurance
Worker’s compensation insurance provides critically important benefits and protections for appliance repair and maintenance businesses. It covers medical expenses and lost wages for employees injured on the job, protects the company from costly injury lawsuits, promotes workplace safety, pays the top benefits like medical care and lost wages, protects from liability, reduces litigation costs and ensures fast recovery, and has a common estimated annual premium of $8,800 for a business with 2 technicians making $40,000 each. The top risks in this field also include electric shocks, cuts, back injuries, slip and falls, repetitive strain, and vehicle accidents while traveling between jobsites.
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Based on national averages, the estimated average pricing for worker’s compensation insurance for businesses in the Appliance Repair and Maintenance (NAICS 811412) industry is around $2.20 per $100 of payroll. This rate is derived from considering industry risk factors like injury rates and claims. The average wage for technicians in this industry is around $20 per hour. So for a business with 2 technicians making an estimated annual salary of $40,000 each, the estimated annual premium would be $2,200 × ($40,000 + $40,000)/$100 = $8,800
Estimated Pricing: $8,800
Errors & Omissions Insurance
Errors and omissions (E&O) insurance provides crucial coverage for appliance repair and maintenance businesses to protect against claims of negligence, errors, or omissions that could occur due to the technical nature of their work. The top benefits, use cases, and estimated pricing show why E&O insurance is an important part of risk management for these types of service businesses. Installing appliances incorrectly could damage customer property or cause safety issues. Failing to properly diagnose an appliance problem may result in further damage. Improper disposal of hazardous materials like refrigerants or mishandling of customer data also present risks. Premiums are estimated around $1,000-$2,000 annually based on factors such as revenue and employee count. E&O insurance demonstrates responsibility to customers and can be required in commercial contracts.
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Based on typical pricing factors like employee count, annual revenue, types of services, and claims history, the estimated average annual premium for Errors & Omissions insurance would be around $1,000-$2,000 per year. Premiums are often calculated as a percentage of revenue, usually 0.5%-1%. With most appliance repair businesses generating $100,000-$500,000 in annual revenue, premiums generally fall within this estimated range.
Estimated Pricing: $1,000-$2,000
Business Owner’S Policy
An business owner’s policy can provide comprehensive insurance coverage tailored for appliance repair and maintenance businesses. It combines multiple insurance coverages into an all-in-one package to protect businesses from common risks they may face. Some key benefits included in the policy are property damage coverage, general liability coverage, business interruption coverage, and errors and omissions coverage. The top uses of the policy for businesses in this industry are to cover business equipment and inventory, liability claims from customers, commercial vehicles if used for business, lost income if the business has to close temporarily, and claims of professional negligence or mistakes in repairs. The estimated average annual cost for a business owner’s policy for a business in this industry is $1,500.
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Based on industry data, the average annual pricing for a business owner’s policy for businesses in the appliance repair and maintenance industry (NAICS code 811412) would be around $1,500. This pricing takes into account factors like the small size of most businesses in this industry, low property and equipment values, moderate liability exposure, and average claims experience in this sector. The pricing was derived from insurance rate filings and industry loss data.
Estimated Pricing: $1,500
Commercial Umbrella Insurance
An umbrella insurance policy provides valuable excess liability protection for appliance repair and maintenance businesses. It covers claims above the limits of the underlying commercial general liability, auto, and workers’ compensation policies in place. Umbrella coverage also defends businesses from lawsuits, protects business owners’ personal assets, and covers incidents not covered under regular business policies like property damage accidents during in-home service calls. Some key benefits of umbrella insurance for these businesses include additional protection from lawsuits alleging injuries, coverage for vehicle accidents while transiting job sites, and average annual costs of $1,200 for $1M in liability protection. Umbrella insurance is especially important for these businesses as they work directly in customers’ homes and businesses where accidents damaging customer property or injuries are possible risks.
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Based on typical industry factors such as number of employees, annual revenue, types of business operations, risks involved, claims history, and location, the estimated average annual pricing for a commercial umbrella insurance policy for businesses in the appliance repair and maintenance industry (NAICS 811412) would be between $1,000 to $2,000. Pricing is usually determined based on the business’s underlying commercial general liability policy limits. For a business with 1-5 employees, annual revenue under $500K, and standard business operations, an umbrella policy with $1M in coverage could cost around $1,200/year on average.
Estimated Pricing: $1,200/year
Conclusion
In summary, having the right business insurance tailored for your appliance repair and maintenance operations can help manage risks, limit financial liability, and provide peace of mind. Considering policies that cover liability, property, vehicles, employees, professional mistakes, and excess protection are key areas appliance repair business owners should evaluate to properly insure their operations.