What Insurance do Alberta Contractors Need?
Your work as an Alberta contractor brings risks. What happens if a client gets injured at your job site?
An accident involving a client, supplier, or member of the public can result in a costly liability lawsuit that your Alberta contractor business may not be able to recover from financially. A contractor/construction insurance package protects your livelihood.
What’s usually in an Alberta contractor insurance package?
General liability insurance
The most important type of insurance you need as an Alberta contractor is commercial general liability insurance (CGL).
If you were sued, commercial general liability insurance would help cover the legal costs to defend the claim against your business in court, as well as costs to cover damages to compensate third parties.
What kind of risks does CGL insurance cover?
Commercial general liability covers risks such as:
- Injury to another person who is not your employee
- Damage to someone’s property
- Damage to rented property
- Medical bills if someone is injured
- Legal and settlement costs of liability lawsuits filed against you
- Liability lawsuits related to slander and libel
Course of construction insurance
As an Alberta general contractor, you need to have course of construction insurance to protect what you’re building from start to finish, whether it’s a residential, commercial, or industrial project.
Your typical contractor’s insurance policy would not cover buildings under construction, which is why you need course of construction insurance coverage.
Course of construction insurance, or builders risk insurance, provides insurance coverage for a building, job site, and construction materials during the construction phase, including renovation and repair.
This type of insurance usually begins before the first materials arrive on the job site and ends once the project is complete. You may also hear it called builder’s risk insurance.
Tools and Equipment Insurance
Any item valued at less than $1,500 is considered a tool. Anything valued above $1,500 is considered equipment.
This type of insurance provides financial protection for any transportable tools or equipment that Alberta contractors use to complete their work projects.
Tools and equipment insurance can provide reimbursement to repair or replace tools if they are lost, damaged, or stolen. Insured events apply to tools and equipment that are vandalized, stolen, lost, or damaged by fire or flood.
Commercial property insurance
Whether you rent or own your business location, commercial property insurance can provide financial coverage for physical loss, such as a fire, or damage to your business property and its contents.
Commercial auto insurance
Any vehicles used by your contractor business need to be covered by commercial auto insurance, including leased or rented vehicles. Your personal car insurance usually does not cover your work vehicles.
Commercial auto insurance covers medical fees, legal costs, and repair or replacement costs if your company's vehicles are involved in an accident. It also covers theft and vandalism.
Professional liability insurance
This type of insurance is also known as errors and omission (E&0) insurance.
If you are faced with a lawsuit as an Alberta contractor, professional liability insurance can help protect you against loss in the event of a lawsuit due to a negligent act, or an error or omission in the course of your services.
Do I need to prove that I have insurance?
Certificates of insurance
Some projects may require you to provide a certificate of insurance (COI). A certificate of insurance is issued by an insurance broker or company, and it shows that you have business insurance. It is a summary or snapshot of your insurance policy, and it contains all the most important details, helping protect against third-party risk.
Customers, businesses, or independent contractors could ask to see proof of insurance before they agree to work with you as an Alberta contractor. If the work you do has a high risk of loss or damage, you should have a certificate of insurance.
How much does Alberta contractor insurance cost?
There’s no one-size-fits-all price for Alberta contractor insurance. The cost will depend on factors such as:
- The type of construction
- Location
- Number of employees
- Annual revenue
- Any past claims
- Security measures
Your Western Financial Group business insurance expert will give you top-notch commercial insurance advice and ways to save on insurance for your Alberta contractor or construction business.
