How to Purchase Contractor’s Insurance Online – Know the best way

Purchase California Contractor’s General Liability Insurance Online

With technological advancement, every task can be accomplished with the help of the internet now which also includes buying insurance policies online as it is the best way of saving your time, effort and hard work. Moreover, you can purchase an insurance policy with the click of a mouse and from the comfort of your home without the need of going online. If you own
a construction business or if you are a contractor, you can also buy a contractors liability insurance policy online.

The insurance will protect you and your business from any unexpected financial loss that arises when someone files a suit against you for an accident or damages caused to their property. But when you have an insurance policy, you will get financial protection for any loss occurred to the third party.

A contractor insurance policy is fundamental as it protects you from paying the entire cost of damage or injuries to any third party as it will also protect you from the potential legal defense as well as the cost of accidents and injuries. Hence it is crucial for you to know how to purchase contractor’s insurance online so that you will be covered for a broad spectrum of risks that you might be exposed to during the completion of a construction project.

Compare and Save on Your Insurance Rates

The most crucial step of purchasing insurance for contractors online is by comparing the quotes of different insurance companies so that you can select a company that offers the lowest quote. You will also need to keep in mind the reputation and reliability of the company so that you can rest assured that you are selecting a company that will offer you the best insurance policy.

There is a wide range of insurance policies that are sold by different companies, but you will need to select an insurance plan according to the needs and requirements of your business. You should look for a policy that has been specially designed for your business operations so that it will offer maximum coverage in case if a third party sue your business for any damage, injury or accident.

The general liability coverage that you get from the insurance companies includes bodily injury, personal injury, property damage, and other unforeseen risks. Hence you should look for an insurance company that will offer coverage for all these risks, but the insurance premium should be lower for covering all these risks.

Taking the help of online resources for finding the most attractive contractor insurance coverage is the best way of getting the insurance product that will offer the maximum amount of benefits for your business.
There are insurance plans that can also be customized according to the needs of your business and you need to do proper research before you get an insurance policy that is most appropriate for your business needs.

Many online insurance plans have lower premium rate as compared to the offline ones, and you should look for an insurance plan that will have maximum coverage with
minimum premium amount.

Top 3 Reasons to Carry General Liability Insurance for Contractors

Why you Should Carry a Contractor Bond and Insurance

Construction work is one of the riskiest kinds of work a person can get into. No matter how careful and experienced workers are and despite the technicality of tools and equipment and a company’s level of experience, accidents do happen. The general liability insurance cover offers protection from injuries, accidents and work mistakes. A contractor with insurance and a contractor bond in place has peace of mind when working on a client’s site. No amount of stress can be compared with having to work on a project with fear of situations that cannot be controlled. With little monthly or annual premiums, a contractor can work on a project knowing they are covered.

Many reasons can compel contractors to contract insurance companies for general liability insurance packages.

The top-most three are:

1. Protection

In the construction industry, no matter how badly a contractor wants to deliver quality work in time, safety comes first because it’s priceless. Insurance packages offer life protection and property protection. The lives of contractors and clients, including their property, tools, and equipment, are valued.

When shopping for insurance packages, a contractor should insist on a full package that covers employees, clients, and property. During the work period, a contractor can get injured, the client or people within the property can get hurt and property destroyed. A good general liability package covers all parties involved.

2. The Client Needs It

Construction work consumes lots of time and money, not to mention the many materials and other things invested. In most cases, clients do their ground check before they can contract a specific contractor. An insurance plan is among the things clients expect a professional contractor to offer.
Clients look for professional preparation for the unexpected. They’re aware that no matter how experienced a contractor is, things can go wrong. Investing in a general liability insurance plan is part of disaster preparedness. They want assurance that in case of injuries and damages, plans for compensation and replacements are in place without blame games.

3. It’s Required by Law

The law values people’s lives, including resources and property protection. It requires contractors to have a plan of life and property protection. The governing law values a construction company with an investment in a general liability insurance policy because it values life, property and other resources.A company without an insurance plan is considered unwilling or unprepared to take responsibility or the right action in case of accidents. The many instances of compensation defaulters in the judicial systems are as a result of companies lacking insurance plans and thus trying to evade compensating for victims for injuries or damages.

A general liability insurance plan is one of a kind, giving contractors the peace of mind they need when handling risky projects. A contractor is more productive when having an active insurance plan because it is purposed to take care of damages. It means contractors get the time they need to concentrate on delivering the best services without overlooking the need to compensate the injured.

GETTING A PERFORMANCE BOND APPROVED

What is a Performance Bond?

A performance bond is a written assurance or guarantee form provided by a third party (bank or insurance company) and submitted by a principal (Client) to the Contractor in charge of giving the contract.

This guarantee form censored by the third party (bank) is an insurer of the principal who has won the contract to exclusively performs and completes his job in due time, and if he/she is not able to do so, then there is a stated and agreed payment he/she is to pay back to the Contractor.  Here is a closer look at performance bonds.

Why Do I Need a Performance Bond?

For every contract I would like to win as a contractor, I need a surety that guarantees that I was a contractor is very much capable of successfully completing a project or contract. This surety backs you up, thereby giving you an edge in every company dishing a contract or a project out.

How Do I Get a Performance Bond Approved?

Getting a performance bond can be very overwhelming at times, being that there are series of forms and information required. Denial of a performance bond after all the time and money spent can be very upsetting sometimes; can even cost you your contract.

So how do you get this closed door opened for you?

In the application of a performance Bond, there are vital qualifications needed. These qualifications encompass Experience, Financial Strength, and Financial Presentation.

Experience

‘There’s no best teacher like experience’. For a performance bond to be approved, the financial institution takes a look at your experience level, knowing that this reveals your skills, character and your ability to complete the project. Most times, performance bond are approved to companies with three years experience.

Financial Strength

For a company to run smoothly without any hitch and glitch there must be sufficient working capital and a handsome net worth should in case. Financial institutions take the good and close look into this by trying to calculate the limits and capability of your company financially.

Financial Presentation

For any work to be approved there must be the proper presentation. There is an aligned format mapped by financial institutions, and once your financial presentation is not given a pass mark, no matter how strong your company is financially, you’ll be denied a performance bond.

For example , financial institutions accepts a tax return or a simplified financial report for bonds lesser than a $1million dollars while for bonds above this amount, the financial institution requires a reviewed financial statement from the Contractor, as this tends to increase your level of assurance and also gets you much more qualified for an approval.

Although there are other factors that are needed in earning an approval of Performance Bond, They are Credit scores, Personal assets, Bank line of credit and so on. Though essential, they can’t be compared with the above factors needed in securing a performance bond.

Types of Contractor Bonds You May Need

Contractor bonds protect the customers from a contractor not completing the job, it offers the client the security that they will be paid if the contractor defaults.  For the most part bonds are classified into two different categories, conditional or demand.  Conditional bonds are common and they serve as proof there will be no resulting loss.  Contactor bonds off the financial assurance that the bills are going to get paid.  The insurance companies or bank that issues the bond will give the customer their guarantee that the commitment of the contractor will hold up.  Construction bonds shield the owner against poor work as well.  There are actually three types of construction bonds, payment, performance, and bid bonds.  Let’s have a look at them.

  1. Bid bonds

The purpose of this type of bond is to protect the client if the contractor doesn’t honor the bid.  Cost overruns have been a huge problem in the construction industry and the bid bond helps to rein in that type of fraud.  Under this type of bond the client has the right to take legal actions against the contractor if the contractor fails to honor the bid.  If there are cost overruns then the insurance company or bank is responsible for them.  That can include having to hire a replacement contractor should it be needed.

  1. Performance bonds

This type of bonds gives you a guarantee that the contractor will be responsible for the completion of the project as outlined in the contract.  The bond is held in place until the project is deemed as complete.  If the contractor cannot finish the job, then the bond holder has to hire a new contractor to get the project finished.  It is also their responsibility for any financial costs because the contractor didn’t complete the job.

  1. Payment bonds

Payment bonds are put in place to make sure that everyone associated with the job gets paid.  This will include any sub-contractor, suppliers and staff.  These bonds will be asked for if you ever decide to bid on any government contracts and you will need to have them in place when you submit your bid.

If you are new to the construction industry with little or no experience under your belt you may struggle to get a contractor bond.  You need to demonstrate that you have the right skills, resources and the ability to get the construction project done.  The insurance company will want to look at your financial records before issuing the bond, these records will include bank statements and credit history.