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GL Contractors Insurance Help

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Old 03-18-2014, 09:55 AM   #1
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GL Contractors Insurance Help

I'm trying to get a company licensed and insured but I'm having trouble getting some insurance that is affordable for a new company any one have any ideas on how or what companies I should try when getting started and what to tell them to get affordable rates? Is there some kind of trick to this or do you really have to pay $1000 a month for the first 3 years??
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Old 03-18-2014, 10:09 AM   #2
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Re: GL Contractors Insurance Help

A lot more information is needed....a lot.

Where you are from is an important first step


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Old 03-18-2014, 10:13 AM   #3
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Re: GL Contractors Insurance Help

I'm from Minnesota and the business would be located and run here.
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Old 03-18-2014, 03:06 PM   #4
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Re: GL Contractors Insurance Help

I think you need to give everyone the same info to compare the rates. It will vary greatly, but it will depend on the type of work you plan to do, how much revenue you are going to do and the amount of coverage you need to operate.

Get together a list of cover assets, vehicles, shop, office space, tools, etc. estimate your yearly sales goal and check with the state on how much insurance you need and let them see all of it.

We carry a $5m umbrella and $2m aggregate gl, but I don't think you will need close to that. They may be quoting very high limits you don't need. Welcome to the wonderful world of insurance, now bend over and get ready!

I switched to Erie a few years ago and cut our general and work comp in half though so there will be big differences. Good luck!
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Old 04-02-2014, 06:11 AM   #5
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Re: GL Contractors Insurance Help

$12,000 a year?

What exactly are you planning to do? Might be cheap for a highly dangerous occupation----

Way high if you are a one man company doing carpentry---

More info needed-----what do you want to do?
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Old 04-02-2014, 06:25 AM   #6
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Re: GL Contractors Insurance Help

Again, more information.
What General Liability are you talking about?
Work comp?
Tool insurance?

$1,000 may not be bad, depending on how much you are getting.
Also, check around quite a bit. Prices vary greatly.
Having a knowledgeable agent is good, but if you have a claim, you agent won't help much. What a knowledgeable agent does do, is make sure you are covered properly.
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Old 04-02-2014, 06:40 AM   #7
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Re: GL Contractors Insurance Help

We just renewed ours. 1731.05 ANNUALLY for $500,000 per occurrence and $1,000,000 aggregate for the general liability. We do gutters, roofing, and exterior carpentry. Gross sales from roofing doubled last year and the policy went up almost $1000.00. Workmanship comp is a whole other ball of wax. I was told the pricing is based off gross sales and the multiplier for your industry. Our gross last year was less than half a million, if that helps.
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Old 04-02-2014, 07:00 AM   #8
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Re: GL Contractors Insurance Help

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Old 04-02-2014, 07:09 AM   #9
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Re: GL Contractors Insurance Help

What type of work are you going to be doing ?

All trades have a use group classification.
This group has a rate per $1000 of income or job cost.
Carpentry is lower $ 5 / per thousand for example.
BUT, roof is much higher $10 per thousand.

We need to know what your planning on doing.
How many employees
What insurances you looking for

Ask a buddy or another contractor who they use.
maybe you can get information locally,

Good luck
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Old 04-21-2014, 11:02 PM   #10
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Re: GL Contractors Insurance Help

I'll echo what jaydee wrote re different rate classifications depending on what kind of work you do. When you present your business to an insurance agent or broker, give as much detailed info as possible. If you say you do construction work and estimate roughly a wide margin of say $100,000 to $250,000 revenue per year, they will take the worse-case scenario and rate you for $250,000 (high-end); or if you say you do roofing but don't say how much or how little, they will assume its a lot. But if you tell them that you only do 5% roofing, shingle only; and that 80% of your work is sub-contracted and all your subs carry their own liability insuarnce and you ask for insurance certificates; well you get the idea.

Part of high rates for new businesses is that you have no track record. So again, assuming worse-case scenario, they assume you don't know how to run a safe business and will likely have a claim. Even if you just started up your business in 2014, if either you as owner or any of your supervisors or foremen have numerous years experience, that will help. Even if you are new at it, if you can tell them that your site foreman has 25 years experience and never had a claim at his previous place of employment, that helps.

P.S. Goes without saying that whatever you tell them, i.e. estimated revenues, years experience, etc. it better be relatively true. You can stretch the truth a little bit, but if you ever have a claim or get audited, and the insurers find out you mis-represented yourself to get a cheaper rate, you'll be black-balled and will find it near impossible to get reasonable insurance going forward.


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