Frequently Asked Questions
Answers to the most frequently asked Property & Casualty questions.
Is my entire premium due upfront?
Depending on the type of insurance and the size of your premium, most insurance carriers allow different payment plans. The carrier will bill you directly and provide payment options. Most premiums are paid with 25% down plus eight or nine additional payments, or in 12 equal monthly installments.
What is business property insurance?
Building and business personal property coverage protects your buildings, equipment, inventory, furniture and fixtures from loss due to fire, theft or vandalism. Some policies also include breakdown and business income coverage.
What is business income coverage?
In the event of a covered loss, business income coverage may reimburse you for the net income that would have been earned if a catastrophic event had not occurred. In addition, losses due to down time or extra expenses needed to restore operations may be covered.
Am I covered if a disgruntled employee destroys part of my business?
It depends on your policy. Some liability policies cover loss that’s caused by an employee who commits a fraudulent act that results in a financial loss to your business.
Liability coverage helps protect your business from claims arising from customer bodily or personal injuries. This coverage may also include: damage to the property of others, products-completed operations, advertising, premises operations, fire, legal liability and related legal defense costs.
How does an umbrella liability policy work?
The umbrella policy provides excess liability limits in the event of a catastrophic loss. Once the underlying limits of the business auto, general liability or employer’s liability policies are exhausted, the umbrella liability policy kicks in to provide additional financial coverage.
What is professional liability insurance?
Also known as malpractice insurance, professional liability insurance protects your business against claims resulting from professional services rendered by you to your clients. This type of insurance covers you and your employees in the event that someone claims you incorrectly performed or failed to perform your professional duties.
Workers' Compensation Insurance
When do I need to buy workers' compensation insurance?
In most states, workers' compensation insurance is required for companies with one or more employees. States typically enforce stiff penalties for employers who do not purchase workers' compensation insurance. Only a handful of states do not require employers to carry this type of coverage.
How much does workers' compensation insurance cost?
Workers' compensation insurance pricing is based on: your payroll, the number and job classifications of the employees, classification of your business and past loss experience. As the employer, you are responsible to pay for the cost of workers’ compensation premiums.
What does workers' compensation insurance do?
Workers' compensation insurance pays for the rehabilitation, recovery or medical bills of employees' work-related injuries, as well as lost time due to a work-related injury . Workers' compensation insurance is not a substitute for health or medical insurance — employees are only covered for on-the-job injuries
I subcontract work to other contractors, but I have no employees — just my partner (half-owner). Do we need workers' compensation insurance for ourselves?
Yes and no. The contractor to which you subcontract is required to have proof of workers' compensation insurance for all workers (including you) in case a claim is submitted. However, your contract for subcontracting work and proof of sufficient liability coverage may suffice as a substitute to carrying workers' compensation insurance. Best practice is to state in the contract: you have no employees, you are sole proprietors and that it is a valid sub-contract.
Commercial Auto Insurance
What is commercial auto insurance?
Commercial auto insurance includes insurance for autos, trucks and vans used for business purposes. If you own a business and use personal vehicles for business purposes, a commercial auto insurance policy can help protect you and your company against third-party claims for property damage or bodily injury. Many personal auto insurance policies exclude coverage if a vehicle is used mainly for business.
Will my employees' personal autos be covered under a commercial auto insurance policy if they are using their autos for business?
Many commercial auto insurance policies cover the liability for your business for employees who use their own autos for business purposes. However, the employees' personal auto policies would be the primary coverage for damage to their automobiles.
When should I drop the comprehensive and collision coverage on my old autos?
Most lenders require comprehensive and collision coverage while you have an outstanding loan on your auto. If you or your business owns the vehicles outright, then the decision should be based on your financial reserves and the auto’s value. Is the vehicle’s value close to the premium paid for comprehensive and collision? Do you have funds available to replace the vehicle if it’s destroyed or stolen? These are some of the factors to consider before you decide to make changes to coverage.
Starting Your Business
We need insurance for our new contracting business, but we don't have a lot of money. What’s necessary to start our operation?*
Small contractor packages are readily available. Pricing is based upon the coverage needed for your operation, your experience, previous claims and your payroll and revenue. Most are priced competitively and include the basic coverage you will need, such as liability and equipment (property). If you have employees, some packages also include workers' compensation, depending on the laws of your state.
*Disclaimer: This is general and informational only; insurance recovery will depend on your individual policy, seek advice of legal and tax advisors etc.