In the State of Florida, there is no requirement for contractors to carry insurance! But if you are working as a General Contractor or working for a General Contractor insurance will be required.
Florida Contractor Insurance Cost
Rates are determined by the number of owners, employee payroll, zip code, type of work you are doing and the limit of insurance. Rates for a single owner, no employees can run as low as $600 per year. As you add employees that rate will increase as the payroll increases.
Most General Contractors have little employee payroll and high sub-contracting costs. The insurance companies set the rate by the number of owners, zip code, employee payroll and sub-contracting costs. Rates for a single owner and subcontracting costs below $500,000 can expect to pay around $3,000 per year.
Florida General Liability – Occurrence Basis
This is the most important coverage a contractor can purchase. This is what will protect you for an array of losses from property damage, to bodily injury, and more. We have broken down the coverages for you below.
There are two types of General Liability Forms a Florida Contractor can purchase, an Occurrence Basis or a Claims-Made. For the construction industry, an occurrence basis form is the most common choice. What is the difference? What policy will respond to a claim. In the case of an Occurrence Basis policy, whatever policy was in effect at the time of the loss is the policy that will pay the claim. For example, XYZ Roofing put on the roof for a brand-new home built in 2015 and was insured with Acme Insurance Company at the time. The contractor has since renewed and is now with a Bravo Insurance Company. He receives a call from the general contractor that due to faulty work, the roof he installed back in 2015 has been leaking and he needs to file a claim for subsequent damages. Since he was insured with Acme Insurance at the time the work was done (that was faulty and resulted in a loss), he will need to file the claim with Acme Insurance.
If he had a Claims-Made policy, it does not matter when the loss occurred, but rather when the loss was reported. If we are looking at the example previously discussed, but now with a Claims-Made policy, he would file the claim to Bravo Insurance Company.
- Each Occurrence: The maximum payout for any one claim or occurrence
- Damage to Rented Premises (also known as Fire Legal Liability): Will pay for damages to a property rented to you as a result of your negligence
- Medical Expense: Provides payment of medical claims someone who is injured at no fault of yours, but is simply on your “premises”
- Personal & Advertising Injury: Provides coverage for liability claims arising out of actions such as libel, slander, or false advertisement
- General Aggregate: This is the maximum payout for all claims for the policy term (typically a year)
- Products and Completed Operations Aggregate: This is the maximum payout for all claims for the term for claims arising from finished projects.
Additional Coverages’ and Endorsements
in many cases, there are additional options that may be required by a customer or general contractor. Several of the coverages can be applied to some or all of the policies, understanding the coverage will help in identifying if you need them on what policy.
- Additional Insured: Amends the policy to broaden coverage to and name the specific individual, company, or organization as covered by the policy. Cost is typically between $50 and $500 each.
- Blanket Additional Insured: A broadened coverage that will provide coverage as an insured to an individual, company, or organization as required by contract. Cost for this coverage averages $500
- Waiver of Subrogation: Waives the insurance company’s right to subrogate (or recoup damages) from the responsible party.
Barbee Jackson Insurance – Your Florida Contractors Insurance Experts
Barbee Jackson Insurance is a leading provider of Florida Contractors Insurance and we work with the largest Commercial Insurance carriers to provide our clients the best coverage options for the best price. Our professional staff is always here to help…even if you insure with our competitors. Call today if you need any help understanding coverage options or if you are looking for a competitive quote 850-389-2001.