Do electricians need business insurance?

As an electrician, the work you do isn’t exactly cut and dried. Sure, there’s a science of sorts to your trade, but you never know when something won’t work, or when something weird might happen. There’s a lot of trial and error involved when it comes to the work of an electrician. And with that, comes risk.

Whether you’re an one-person electrical contractor, or a large operation with many employees, you can benefit from electrician insurance.

Types of Insurance

General liability insurance is a great place to start. Think of it as a catchall policy for all of the random things that can go wrong when you work for yourself. Another very important coverage for electricians is workers’ compensation insurance. It covers you and your employees in the event of an illness or injury due to work performed on the job.

What is general liability insurance, and why is it important for electricians?

Electricians’ work is physical. And since you typically visit job sites and interact with clients, general liability insurance is necessary for your line of work.

Liability insurance covers:

  • Property damage: You’re working on an electrical panel and a small fire damages nearby furniture or expensive drapery.
  • Bodily injury: A client trips over one of your extension cords and fractures their wrist.
  • Personal/advertising injury: You complain about a client in one of your Facebook statuses, and they claim libel.
  • Legal defenses and settlements are covered should you face a claim. This includes lawyers’ fees, punitive damages, and court costs.
$35.6 billion
Small businesses pay $35.6 billion out of pocket to settle claims each year.
890,000
That’s equal to 890,000 electric cars.

What about workers’ compensation insurance?

Getting workers’ comp insurance is crucial– regardless of whether or not you have employees.

Benefits of this policy include:

  • Medical costs incurred due to illness or injury
  • Return to work and recovery services
  • Reimbursement for lost wages
  • Employers liability coverage, should an employee file a lawsuit
Medical bills can be extremely expensive. If you don’t want to pay for them out of pocket (and why would you?), you should get a workers’ compensation policy. Another great thing about workers’ comp insurance is that if you’re out of work for a month or two, the policy will provide supplemental income while you’re away from work.

What other types of insurance should electricians consider?

  • Business auto: This insurance coverage protects vehicles owned by your business. You probably own a truck, van, or fleet of vehicles to transport tools and materials to job sites. By law, you need an auto insurance policy for your company-owned vehicles.
  • Hired & non-owned auto: This protects your company against accidents that may occur when you hire, rent, or borrow vehicles for work. This includes employee accidents while using their personal vehicle on behalf of your business.
  • Business property: Work equipment is expensive. This policy protects commercial property from fire, natural disasters, theft, and vandalism. Note: If you stow your work gear at home, keep in mind that your homeowners policy typically only covers up to $500 in business property damages.
  • Inland marine: Business property coverage ends after you’re 500 feet away from your business premises. If you take your tools with you to different locations, get an inland marine policy to protect them.

If you want to protect yourself,  your assets and your employees, you’ll need the right insurance– and we can help.

Electrician Insurance Cost

Electrical contractors can save money by comparing quotes with Pogo. But here’s a breakdown of general cost ideas for a small operation.

General Liability Insurance: Electricians can get liability insurance from around $58/month for $1 million per occurrence; $2 million aggregate. And that’s with about a $250 deductible. The cost will depend on the size of your business, how much you interact with the public, endorsements, use of subcontractors, and more. See an in-depth breakdown of General Liability Insurance Costs.

Business Owner’s Policy: Electricians can get a BOP from around $79/month. That’s with about a $1,000 deductible and $1 million per occurrence, $2 million aggregate. It saves you money by bundling property and liability insurance together. The price is based on your limits, business size, interaction with the public, and the value of your property. Look deeper at business owners policy costs.

Workers’ Comp: Electricians can get workers’ comp from around $220/month. Workers’ comp prices depend on a lot of factors like the number of employees and what type of work they do. Look deeper at workers comp costs.

Commercial Auto: Electricians can get an auto policy from around $140/month. The cost depends on your coverage choices, the value of the vehicle, and the driving records of anyone that drives it.

Contractor’s tools and equipment: Electricians can get property insurance from around $41/month. The price depends on the type of work you do and the value of your tools and equipment.

Professional liability insurance (E&O): Electricians can get professional liability insurance from around $75/month. The cost depends on the coverage limits you choose, the size of your business, and the type of work you do. Check out our guide to errors and omissions insurance costs.

Umbrella insurance: Electricians can get umbrella insurance from around $65/month. The price of umbrella insurance mainly depends on the amount of coverage you need to buy.

Surety bonds: Electricians can get surety bonds starting around $5/month. The cost depends on the size of the bond you purchase.

These figures can give a starting idea of what insurance coverage might cost. And remember– it all depends on the size of your operation and how much risk you face.

We can save you money.

We’ll compare quotes from over 30 electrical contractor insurance companies. It’s totally free— no hidden fees and no obligation, and it’ll save you time and money!