General contractors can tackle everything from hanging drywall and installing kitchen cabinets to digging a hole for a backyard pool and building a deck. As someone who owns a business as a contractor, it is critical that you invest in general liability insurance. If you do not, there are situations that can come up that will completely ruin your business financially. Here is a look at a few worst-case scenarios that could come up and how contractor liability insurance would help you in certain situations.
Worst-Case Scenario: You get sued by someone you hire to help you because they got hurt working for you.
Any time you have employees who work for you, it is best if you have contractor liability insurance, even if you only employ someone on occasion or have one or two people who work for you. One thing contractor liability insurance does for you is step in and save you if you get sued by one of your employees. One lawsuit can cost you thousands of dollars, especially if the person who sues you was severely injured on the job.
Worst-Case Scenario: You accidentally hit a customer's vehicle with a piece of your equipment in the job.
No matter how safe you are or how skilled you may be at doing your job, accidents can and do happen. If you accidentally damage a customer's property, even their vehicle, with a piece of your equipment or during a workday project or task, you will be held liable for the damages. You can't expect your customers to pay for the damages you caused, and they won't be willing to do so anyway. Having liability insurance will ensure any damage that you do accidentally cause on the job is paid for so you aren't out a ton of money in the event something happens.
Worst-Case Scenario: You install drywall that contains a chemical that makes a homeowner very sick.
Just as contractor liability insurance protects you if you cause property damage to a customer's property, it also protects you if you inadvertently cause them bodily harm or some kind of harm to their health. While this situation would warrant you filing a lawsuit of your own against the drywall manufacturer, your customer will still be looking at you initially as the cause of the problem, and you will need liability insurance to cover the costs of those initial claims.