4 Types of Insurance Civil Contracting Companies May Need

31 August 2017
 Categories: Insurance, Blog


If you run a civil contracting company, bumping into accidents or issues can be inevitable. To ensure your business and your personal finances are well protected, you need a few insurance policies in place. Wondering what you need? Well, it varies based on your unique situation, but here are some essential policies to consider.

1. Worker's Compensation

Contracting work can be dangerous. Bricks may fall on your worker's heads, your employees may get hurt by machinery or other accidents may happen. To ensure they are protected, you are required by law to get worker's compensation coverage.

This type of coverage is required by employers in all industries. Although it's a heavily regulated industry and a lot of the claims get handled by state boards, you still buy this type of coverage through private insurers.

2. Life Insurance

In case one of your employees dies while on the job, you may want to take out life insurance. You can offer this as an employee perk—in this case, your employees get to choose the beneficiaries. However, you can also take out life insurance policies on your employees with you or your company as the beneficiary. Those payouts can cover delays in your project related to the death of a worker.

3. Bid Bonds

In some cases, you may need to invest in bid bonds. A bid bond is a special insurance policy just for contractors. If you put in a bid on a civil contracting job, but you can't take the job once it's offered to you, the bid bond covers any losses incurred by the organisation that was affected by your inability to take the bid.

For example, their expenses may include advertising for new contractors and reviewing additional bids.

4. Construction Surety Bond

Once you start a project, you may need a surety bond. Like a bid bond, this is also a type of insurance that kicks in if you are unable to complete a project. For example, imagine that you take on a civil contracting job and you have to quit in the middle of it. In this case, the client who hired you could make a claim to the insurer who issued the surety bond to cover any costs incurred due to the unfinished project.

It's important to note that this type of coverage doesn't work exactly like traditional insurance coverage. Namely, the insurer or issuer of the surety bond doesn't cover the payout. Instead, that entity pays out initially as needed, but then, your business is required to repay that payout.

Have more questions? Ready to start booking coverage? Then, contact an insurance agent that specialises in working with civil contracting insurance today.