Hiring a roofing contractor based on the quality of their work alone is not enough. They must be reliable, credible, and trustworthy enough to know how to protect their clients and themselves if something terrible happens to anyone during the project. Roofing is a dangerous occupation, and any responsible roofing contractor will take extra steps to ensure that any injuries to any parties will have proper coverage.
For this reason, you should only hire a roofing contractor who has the necessary insurance policies to operate. Doing so will protect you from any liability if a roofer gets into an accident while working on your roof.
Not all states require their roofers to have insurance, though. But in the case of Florida, it’s a must, and all roofing contractors must have the necessary insurance before they can even get a license, participate in contract bidding, and conduct roofing operations. More customers tend to flock to insured roofing contractors because they know that in case something terrible happens, they know they’re protected and secured.
This article will feature the two most important insurance a roofing contractor must-have, not only in Florida but also in other states. Other insurances mentioned here are for the roofing contractors looking for insurances to protect them and their business.
Two Important Insurance a Contractor Should Have
A roofing contractor has a long list of insurance before they operate, but there are only two of them that directly affect the homeowner.
Worker’s Compensation Insurance
Suppose a roofer is working on your roof, and then suddenly he slips and falls. After recuperating, the roofer starts to file claims against you, saying that you should be responsible for all the bills and lost wages since the accident happened on your property.
If your contractor’s worker’s compensation insurance is still valid, then you’re safe from the charges thrown at you by the roofer. However, suppose the contractor’s insurance is expired when the accident happens. In that case, you may be held responsible for all the roofer’s bills, including hospital bills, and even funeral costs, in an unfortunate death.
A Worker’s Compensation Insurance covers the medical bills and the roofer’s lost wages while he’s still working for you. If the accident had more severe consequences like permanent disability or death, the insurance would also cover those costs. The worker’s compensation insurance protects all the parties involved in the roofing project, particularly protecting the roofers from the devastating effects of a work accident.
A Real-Life Case of an Uninsured Roofing Contractor
Even though having a worker’s compensation is a mandatory business, it is still not enough to stop mischievous contractors from operating without it. An excellent example of this scheme is Peter Daniel Yeaman, a Washington roofing contractor who failed to provide worker’s compensation coverage for his employees. He operated despite having his worker’s compensation revoked, costing a homeowner $4,500 more than they anticipated.
Please do not trust roofing contractors who do not take their responsibilities to their employees and the government seriously. Check if the contractor has an updated Worker’s Compensation Insurance before you hire them.
General Liability Insurance
Here’s another scenario. You contacted a roofing contractor to patch up a small area of your roof because a few shingles fell off during a hurricane. The rest of your roof is still okay, so you’re confident that the job will be easy.
However, the roofer started working near your chimney, and after hammering too hard, the roofer managed to break off a couple of bricks from the chimney. Instead of having a patch of your roof fixed, you now have another problem.
Who do you think would have to pay for the ruined chimney? If the roofing contractor doesn’t have general liability insurance, you would have to cover the costs of fixing the patch with broken shingles.
You’d also have to deal with the extra cost of repairing a broken chimney. But if the contractor has general liability insurance, then the roofing company is liable for the damage, and they will correct the ruined chimney at no extra cost.
If a roofer causes damage to your property or hurts a non-worker, the general liability insurance can also cover for you. Suppose the bricks from the earlier scenario fell into one of your family member’s heads. In that case, the roofing contractor will be liable for the damage done to the roof and the injury done to your family member’s head.
Other Important Roofing Insurance a Contractor Needs
The two types of insurance mentioned above are geared toward protecting the homeowner and the roofing contractor’s employees. However, roofing contractors will also need something to protect themselves and the business from the risk of property and equipment damage and anything that may cause financial loss to the company.
Below are some of the insurances a roofing contractor needs to ensure the utmost protection of his business and everything it encompasses.
Business Owner’s Policy
Business Owner’s Policy makes it easy for small to medium-sized roofing companies with less than 100 employees to acquire commercial property, general liability, and business interruption insurance altogether instead of purchasing them separately.
If you’re a roofing contractor, separately acquiring each insurance will take you time, effort, and money. But if you instead choose to purchase a Business Owner’s Policy, you get to take them all in one basket.
Commercial Property Insurance
This insurance covers both property and equipment damage. Commercial Property Insurance is ideal if you want to protect your properties (office buildings, warehouses, garages, etc.) and their content. Whether you purchased or rented, roofing contractors can leverage this insurance to safeguard any roofing tools and equipment.
General Liability Insurance
As mentioned above, the General Liability Insurance will protect the roofers from the injuries they made to the non-workers. But little do people know that this insurance can also protect the business owner from various issues such as wrongful arrest, slander, and libel. This insurance will also cover you from claims made by your customers regarding the products/service your roofing company advertises.
Business Interruption Insurance
The Business Interruption Insurance will reimburse your business if it closes down or will not be able to function for whatever reason. This insurance will cover a year’s income loss and operating expenses.
Professional Liability Insurance
Most roofing contractors will not see this type of insurance as essential, but some roofing companies can benefit significantly. A Professional Liability Insurance will protect a roofing contractor from any case of legal claims done because of any advice or recommendation that caused financial loss to the third party who received them.
This insurance is ideal for roofing companies who regularly consult customers regarding what products, materials, services, and treatment they should use to maintain or repair their roofs. It’s like saying “take it with a grain of salt,” insurance-wise.
Inland Marine Insurance
This type of insurance is excellent for roofing contractors who tend to work from place to place while hauling their supplies and equipment. It covers transportable materials, products, and equipment. Inland Marine Insurance also covers everything stored inside the policyholder’s location, even if the property is someone else. If you’re a contractor who works around different states and drags along their equipment, you should get this insurance policy.
A bonded roofing contractor is a contractor who’s tied to a company under a surety bond, which is a legal contract between two parties geared to protect one party from financial loss if the second party fails to deliver desirable results.
So how do surety bonds work? The roofing contractor and the bonding company will form a symbiotic relationship to ensure that the customer gets the result they want. Suppose the bonded contractor fails to deliver a satisfactory roofing job to the customer. In that case, the bonding company will get a third-party contractor to finish the job, so it satisfies the terms of your contract.
Most homeowners are willing to pay slightly higher to work with a licensed and bonded roofing contractor because they know they’re covered if anything goes south.
Builder’s Risk Insurance
A builder’s risk insurance, also referred to as construction insurance, covers your business from injuries and damage done by a third party while your roofing project is ongoing. The builder’s risk insurance will cover lost/stolen equipment, damage to the building done during construction, temporary structures, and labor costs. While some contractors would argue about its necessity, most contractors would agree that this insurance is a must to win more clients.
Roofing is a high-risk occupation that puts all parties in danger if the project runs its course. While it often costs a premium, insurance will guarantee the protection of the homeowner, roofers, and roofing contractor against predictable elements like theft, property damage, accidents, legal claims, and many more.
If you want to work with a reliable roofing contractor covered by the insurance mentioned above, then Century Roofing Specialists can help you.