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5 Important Questions Home Business Owners Need to Ask

February 2, 2012 By

Believe it or not, contractors who operate their businesses from home carry risks that are almost identical to those carried by big corporations. Regardless of whether it’s just you and the tools of your trade or you and a hired team of of employees or subcontractors, insurance coverage is a must.

If you have any doubts about whether you need a policy, here are five important questions you need to ask yourself about your business:

  • Home based contractors need to look at their insurance needs.

    Thinking about insurance?

    Can what I do cause personal injury or property damage? – Risks abound and your work and/or the work of your employees or subcontractors could potentially cause injury to others. Moreover, the very materials you use could end up damaging existing property.

  •  What is my business risk? – The answer to this question depends on your profession and the kind of work you do. Some home business owners may need a customized business owner policy whereas others may just need a simple commercial general liability policy.
  • Can I be held liable for injury or damage? – Even the smallest mistakes can land you in court. Liability insurance can protect your company assets if your business is sued for causing personal injury or property damage.
  • Are my labor and materials protected? – If your business takes you and your equipment into the field, you risk losing your materials to fire, theft, vandalism and bad weather or natural disasters. With builder’s risk insurance, you can protect your equipment from circumstances that are beyond your control.
  • Do I need worker’s compensation insurance? –  No matter how safe you think your worksite(s) are, your employees could still get  injured on the job. Workers compensation will cover work-related illnesses in addition to certain medical expenses, lost income and rehabilitation costs.

It’s dangerous to assume that just because you’ve had no problems in the past, you won’t have any in the future. The insurance experts at Statewide can help you determine the policy that’s right for your business. Our brokers are here to keep you covered so that you don’t lose your shirt: contest us today for your free quote.

Photo credit: nokhoog_buchachon
Call Statewide Insurance Brokers at (888) 258-0272 today for fast, free quotes on contractor’s insurance.
Filed Under: Contractors Insurance Tagged With: , ,

New California Laws Discourage Illegal Contracting Practices

January 8, 2012 By

California contractor laws

The changes in California law are intended to protect honest contractors.

The California State Assembly recently passed two measures intended to end the practice of what has come to be known as “black market contracting.” According to Aqua Magazine online, these laws specifically target contractors who “skirt workers compensation insurance.”

The first measure, AB 397, “requires contractors claiming workers’ compensation exemptions to recertify their status or supply proof of insurance whenever they renew their licenses.” The second measure, AB 878, “requires insurers to report client companies underreporting salaries to the Contractors State License Board (CSLB).”

Both laws are intended to address illegal contracting practices that have hurt consumers as well as “law-abiding contractors who have struggled to compete against those who cut corners by not properly insuring workers.” They also come at a time when the CSLB is cracking down on unlicensed contractors through sting operations. Aqua Magazine reports that in November, the Statewide Investigative Fraud Team (SWIFT) unit of the CSLB “arrested eight illegal contractors [in] Murrieta” and that “similar operations netted 113 violators in eight other cities.”

California is, of course, not the only state to face this dilemma, nor is the problem endemic to just one industry: “illegal contracting practices have [plagued a variety of] markets all over the country.” The recession that began in 2008 has only made the situation worse, especially in unstable economic climates like the one that has characterized the Golden State.

If you are a California contractor who is unsure if your own liability coverage meets the requirements, contact the experts at Statewide Insurance. They’ll help you understand the changes so that you can take care of your workers—and ultimately, your business—the right way.

Call Statewide Insurance Brokers at (888) 258-0272 today for fast, free quotes on contractor’s insurance.
Filed Under: California Workers Compensation Insurance Tagged With: , , , ,

About Commercial Truck Insurance

January 6, 2012 By

Commercial truck insurance

Using a commercial truck? You'll need commercial truck insurance. Call Statewide Insurance Brokers.

If your business uses trucks to haul goods or other materials across town or across the country, then you need commercial truck insurance. No matter how good  a trucker’s driving record may be, trucking itself can be a dangerous profession. At some point, a trucker will encounter hazardous conditions on the roadway. Are you prepared?

Carrying a commercial truck insurance policy ensures that both the driver and any other motorists are compensated in the event of accidental injury or damage that may occur in a crash. The two major types of truck insurance that exist include general liability and physical damage plans.

General liability typically covers business employees and any independent truck owner/operators you may hire for a specific haul. This type of insurance policy will take care of damage sustained in an accident by the other motorist(s). This type of protection is required by law no matter the circumstances under which a commercial truck is being operated.

Physical damage coverage protects against damage done to your personal property–for example, any trucks you may own and use for your business–regardless of who’s at fault in the accident. A comprehensive insurance policy will cover you in the event of such unforeseen events as theft, fire, flood and earthquakes, all of which are among the many dangers that exist on the road.

When you buy commercial truck insurance, it’s important to make sure that your policy maximums are equivalent to your estimated repair or replacement expenses. Don’t forget to also factor in state and government restrictions when deciding on the level of coverage to purchase. The experts at Statewide Insurance can help you sort out these issues and determine which insurance plan currently on the market best meets your business needs: call or e-mail us today for an estimate.

Call Statewide Insurance Brokers at (888) 258-0272 to get fast quotes on commercial truck insurance.
Filed Under: Commercial Vehicle Insurance Tagged With: , , ,

Understanding Surety Bonds

December 27, 2011 By

surety bond creates client trust

Surety bonds can help generate trust between you and your clients. Call Statewide Insurance Brokers for more information.

You may be a construction industry veteran, but it’s quite possible that you are one of the many construction professionals who doesn’t completely “get” surety bonds.  As a recent article in Construction Digital online reports, “understanding of [surety bonds] is…surprisingly limited”: moreover, the lack of full comprehension extends to the very contractors who use them.

Surety bonds are important to the construction industry because they bring the three key entities into a legally binding contract. These entities include:

  •  the principal or contractor who buys surety bonds to guarantee his/her work
  • the obligee or project owner/government agency that needs the bonds to protect against financial loss
  • the surety or company that issues the bond and serves as a mediator between the principal and the obligee

In the event a contractor doesn’t meet the terms of a bond, the affected parties can then “make a claim on the bond to gain reparation.” The bond issuer will typically require that a contractor “provide reimbursement according to the bond’s indemnity agreement.”

Bonding also ensures that the bidding process is transparent. When a contractor initially bids for a project, he or she will typically offer bid bonds which guarantee that the contractor “will complete a job for the initial bid without raising the cost.” This encourages bidding from financially stable companies while assuring project owners that they can file a claim to recover any losses incurred from potential price gouging.

Most importantly of all, however, construction bonds “reinforce client trust.” When project owners work with a bonded construction professional, they can rest assured that the contractor has a good reputation and that they will be protected against damages. This is because surety bond providers “conduct thorough background checks”  on all  individuals who seek bonding.

Your clients depend on you. That’s why Statewide Insurance offers information about bonding and surety companies when you need it most: we’re the brokers you can rely on to help make your business a safe bet for success.

For more information about Statewide Insurance Brokers Surety Bonds, call 888-258-0272.
Filed Under: Surety Bonds Tagged With: ,

Changes to Texas Certificate of Insurance Law

December 7, 2011 By

texas capitol certificate of insurance change

Find out how recent legislative changes affect Texas certificates of insurance.

If you are a contractor in Texas, you need to be aware that the law regarding certificates of insurance (COIs) has changed. Property Insurance Coverage Law.com reports that the Texas Legislature passed a bill this past legislative term that adds “a new chapter to the Texas Insurance Code.”

Senate Bill 425, which took effect on September 1st of this year, will formally apply to all certificates of insurance issued on or after January 1, 2012.  The new law states that “the Texas Department of Insurance (TDI) [must] approve certificates of insurance in connection with casualty and property policies.”

Because differences often existed between certificates of insurance and actual insurance policies, the TDI did not approve certificates of insurance prior to the passage of Senate Bill 425. Unfortunately, this situation gave rise to costly litigation. Court cases have since held that “certificates of insurance are issued for informational purposes alone and cannot alter the terms of coverage provided by an insurance policy.”

According to the new law, a certificate of insurance:

  • cannot convey a contractual rights under any circumstances
  • does not “amend, extend or alter the coverage afforded under a policy”
  • confers no  “new or additional rights beyond the policy”

A COI form “must now be filed and approved by the Texas Department of Insurance.” The penalties for noncompliance are stiff: anyone found to have broken the law can be fined $1000 for each infraction. Moreover, “an insurer or agent who violates this chapter will be subject to cease and desist orders, injunctive relief, civil penalties, or any combination of those punishments.”

Knowledge is power: the more you know, the better off you’ll be in the long run, especially if you own and run your own business. Addressing any Texas COI concerns you may have with the specialists at Statewide Insurance will give you the peace of mind you deserve.

 

 

Filed Under: Texas Certificates of Insurance Tagged With: ,

Negligence or Pollution?

December 1, 2011 By

los angeles general liability insurance

If you're a California contractor, understanding environmental issues is a vital part of general liability insurance.

The Thomson Reuters News & Insight website reports that the California state Supreme Court recently ruled that “a commercial general liability policy’s pollution exclusion barr[ing] coverage of third-party damages from environmental pollution also governed first-party property insurance policies.”

The case involved the Villa Los Alamos Homeowners Association (VLAHA); Cal Coast Construction (CCC), a firm the VLAHA had hired to do property maintenance work; and State Farm, the VLAHA’s insurer.

In a residential building that the VLAHA operated and managed, CCC scraped the acoustical ceilings and stairways, causing “asbestos fibers to be released into the air, individual units, and the building’s indoor and outdoor common areas.” As a result, “a local environmental agency ordered the association to perform comprehensive cleanup of the building.” The total cost came to $650,000.

The VLAHA complied, but asked State Farm to cover expenses. The insurer refused, citing a pollution exclusion in the VLAHA’s policy “which covered both first party robbery losses and third-party business liability claims.”

The association won a negligence suit against the CCC and was awarded $600,000. But it lost another suit it filed against State Farm for “breach of contract and bad faith.” VLAHA argued that “a one-time ordinary act of negligence failed to constitute environmental pollution.”

The California Supreme Court ruled that State Farm was within its rights to refuse payment because the work CCC had done for VLAHA “occurred over several days and resulted in sufficient release of asbestos fibers into the air contaminate the building complex in the adjacent outside areas, constituting environmental pollution.”

Statewide Insurance Brokers provides general liability insurance. Call us today with questions and to get fast, free quotes.
Filed Under: California General Liability Insurance, General Liability Insurance Tagged With: , ,

About Certificates of Insurance

November 21, 2011 By

certificates of insurance statewide insurance brokers

Certificates of insurance are available via statewide insurance brokers.

As a contractor, you know how important it is to carry liability insurance.  You should also have certificates of insurance (COIs) as well, since you never know when a client may request information about specific insurance policies you carry in the event  your company incurs losses on a specific job.

According to the website Mondaq.com, a COI will have a record of the following information:

  • the issuer of the COI (this is usually the insurance agent)
  • the name of the person covered by the policy
  • the name of the insurer or insurers
  • the type of insurance
  • the policy number, policy effective date and policy expiration date
  • the limits of coverage
  • any operations, locations, vehicles and/or exclusions added by endorsement
  • the name of the party to whom the certificate is issued
  • cancellation

No standard COI form exists. However, “the predominant form is one of dozens designed and copywritten by the ACORD Corporation, [which] designs forms for specific insurance risks and files them with state insurance departments.” Since ACORD periodically revises its forms, you should take care when requesting a specific one as it may be out of date.

Be aware that “even though you are listed as a certificate holder, you may not be covered by the policy: you must be added as an additional insured to the policy by rider or amendment.” ACORD has created “numerous forms for specific industries and risks [so] it is important to review the specific form as it often contains policy exclusions or other coverage limitations.”

COI forms can be be confusing: consult with your risk manager or insurance agent if you have any questions. Remember that if any COI you have is not issued in accordance with your contractual obligations, questions could be raised regarding liability, which could result in claims and costs you hadn’t anticipated.

For Certificates of Insurance, contact Statewide Insurance Brokers at 888-258-0272.
Filed Under: Certificates of Insurance Tagged With: ,

What Limited Liability Really Means

November 4, 2011 By

When a business owner operates through the structures known as an LLC, it is usually to gain what is called “limited liability.” As Journal-News.net states, “limited liability means that an owner or investor cannot lose more money than the amount [he or she has] invested or personally guaranteed.”

pen and paper

What role does limited liability really play in protecting a business owner?

But what role does limited liability really play in protecting that business owner?

To begin, there’s no foolproof way “individuals can completely shelter themselves from all liability that may arise with the company.” However, if the organization is structured carefully and well, it “can protect the personal assets of members and participants from liability arising out of the acts or omissions of the organization” or “of other members or participants.”

This means that all bylaws and operating agreements and articles should be carefully drawn up to assure that “proper indemnities are provided by the company.” Ensuring that a business entity is properly insured and in good financial health are also important “to limiting the liability of members and participants.”

Getting limited liability could be as easy as filling out a form. However, maintaining it “may require following some administrative formalities” that many business owners dislike but are still very necessary. Some of these may include:

  • Creating and maintaining operating agreements
  • Keeping “separate and accurate accounting records for the business”
  • Disallowing the co-mingling of “money, other assets, income or expenses of the business and its owners”
  • Holding “regular, documented owner/board meetings”
  • Putting all “agreements and policy decisions in writing,” even when they are “between the business and its single owner.”

For small business owners in particular, these formalities may seem excessive. But proper structuring–which is best done with the assistance of good attorney–will go a long way towards ensuring the best protections possible.

Obtaining the proper insurance is the best way to avoid complications arising from the day-to-day actions of doing business. Call Statewide Insurance Brokers at 888-258-0272 today.
Filed Under: General Liability Insurance Tagged With: , ,

Is Faulty Workmanship an “Occurrence”?

October 29, 2011 By

When it comes to determining whether faulty workmanship is an occurrence, inconsistency is the watchword.  No way currently exists to accurately predict when–or even if–a contractor is entitled to coverage from an insurer.

hardhat

Contractors must think strategically and be proactive

Insurance Journal.com offers the following example to illustrate a situation that’s all too familiar to construction contractors: A developer hires you to construct a building.  You then hire a subcontractor to do a portion of the work (say, a façade) which, upon completion, collapses. The developer then tells you to repair the work and you in turn seek coverage from your liability insurer because the property owners do not submit the claim to their own insurer.

Ultimately, your insurer denies the claim and says “there was no occurrence [because] there was really nothing accidental about what happened.”  The work was defective and the ‘your work’ exclusion doesn’t cover defective workmanship. Besides which, your policy has a collapse exclusion.

Insurance Journal.com observes that “the law on these issues varies from state to state.” In some states, faulty workmanship is indeed an occurrence: but in others, it is not. Still others are undecided on the matter while some “say faulty workmanship is not an occurrence but the resulting damage is.”

In the midst of all this confusion, the contractor needs to keep a clear head.  As the website points out that “defective construction is something that’s created over time.” This may offer contractors and their attorneys an effective way to dispute a claim.

The contractor should also stay aware of:

  1. the state in which a policy was issued and,
  2. whether or not there are parties involved in a matter from different states. This is because plaintiffs will often try to “forum shop”–that is, locate a state (associated with the policy or the parties) that is friendly to their claims.

If you are a contractor who finds yourself in this situation, the best advice is to think strategically and be proactive. In other words: “think about what’s being brought [forward] and why and understand “that the insurer is strategizing about the same thing.”  Doing so will help you protect your rights and maximize the possibility that insurers will honor your claim.

Statewide Insurance Brokers offers contractors a safe bet: great insurance quotes from up to 40 insurance providers. Talk to us and know you’re getting a great deal.
Filed Under: General Liability Insurance Tagged With: , , ,

What Is Contractors Insurance And Why Do I Need It?

October 17, 2011 By

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Contractor's insurance is a must. Call Statewide Insurance Brokers at 888-258-0272.

Contractor’s insurance is a special type of insurance for contractors. Contractors are at risk from liability not only from employees but from customers. Employees could be injured on the job, or cause injury to a client’s person or property. There are many ways in which contractors can be held accountable for actions they themselves did not commit and this is because, as a contractor, you assume responsibility as soon as you sign a contract for a job. Contractor’s insurance can prove invaluable in the case of an accident and save your business from expensive lawsuits.

There are several types of insurance that falls under contractor’s insurance. This includes general liability, workers compensation, bonds and commercial vehicle insurance. Each contractor will have a their own specific needs for insurance based on the exact nature of their business and how many employees they have. The best way to find out what the best contractor’s insurance policy is for you is to talk to your insurance representative so you can get a quote.

A contractor’s insurance policy can be written and confirmed in as little as 30 minutes. This means that no matter how much of a time crunch a contractor is on, they never have to send their employees to a job without having adequate insurance. While contractors may think that insurance doesn’t matter, it really does. If an employee is injured while on the job, the contractor could be sued and even lose their business. All it takes is one accident to cause a contractor to lose their business. There is no reason to take a risk like this when contractor’s insurance is so inexpensive and easy to get.

Contractors that don’t have insurance run the risk of being sent to small claims court over injuries sustained on the job. If your employees drive a company car, you are also responsible for injuries that may happen while the employee is driving. There is no way that you can keep accidents from happening, especially when you have a number of employees scattered over several work zones. Contractor’s insurance policies can be custom written for your business to cover all your bases so that no matter what accidents may occur, you will be able to handle it inexpensively as well as quickly and efficiently.

Before you begin your next job as a contractor, you need to find out about contractor’s insurance if you haven’t done so already. Even if you have been able to get away with not having it in the past, there is no guarantee that your luck will continue. Contractor’s insurance will save you time, money and effort and will ensure that your business is backed by a secure insurance policy that will protect you from liability law suits. You can even get an insurance policy that will cover you for past jobs, so don’t forget to ask about this added benefit. There is no reason to let the business you have worked so hard to grow go under because of a liability law suit. Get contractor’s insurance and conduct your business worry free.

Call Statewide Insurance Brokers at 888-258-0272 to get a fast quote on contractor’s insurance today.
Filed Under: General Liability Insurance Tagged With: , ,