Contractors have realised the importance of carrying out a small business insurance policy for contractors. These policies offer the contractor financial protection in case of financial disasters such as loss due to fire, explosion or theft. The insurance policy can cover up to the amount agreed in the contract between the contractor and the insurance company. However, if the contract contains an element that will require additional work by the contractor, it is important that the contractor explains this point before signing the contract. This is because the additional work may result to an increase in the cost of the premium of the insurance policy. Therefore, it is advisable that the contractor makes arrangements to meet these expenditures in time before he commences work.
There are different types of business insurance for contractors. Two of these types are general liability and workers' compensation insurance. General liability covers damage or injury to a property caused by a person working on your premises. In the workers' compensation insurance, a business is protected against injuries suffered by employees working on your premises. Business owners need to understand the limitations of these business insurance for contractors. It is advisable that they ask the insurance company about the limits of the coverage provided.
The insurance companies usually prefer business insurance for contractors with one employee. This is because the cost of insuring more employees is expensive than insuring a single employee. Usually, the insurance company charges the business owner's employees more if they are working on your premises than they charge a contractor. It is not advisable for business owners to take the risk of having employees who are not covered under their business insurance for contractors.
Some insurance companies may also refuse to give workers' compensation to the contractor if he does not submit to background and fingerprinting tests. Before hiring a contractor, you should check his background and verify his work history. If the business owner has hired him on a regular basis, he should not experience difficulty in collecting information on past workers' comp cases. A contractor with a clean record will be easier to employ in the future.
Business owners should also be wary about using contractors who are working illegally or without proper workers' compensation insurance. These kinds of contractors may also have lower rates. However, it is advisable that a business owner hires legal contractors even if the rates are low.
It is better to use business insurance for contractors to protect the business. This is because workers' compensation insurance will cover the costs of treating an injured worker. In addition, workers' compensation insurance is the only way a business owner can legally make up for the costs of treating an injured employee. Although business owners and workers may be able to settle their claims through the courts, this process could be costly and time-consuming. If a contractor hires workers' compensation, he will not have to pay for medical bills, but he will still be responsible for other expenses incurred during treatment. Therefore, it is much . . . . . . better to make sure that a contractor has workers' compensation insurance before hiring him.