Insurance for construction companies
Construction is a complex business with many working professionals, tools, and technology used for multiple types of building projects. There are inherent dangers associated with the work you do. Getting a tailored construction insurance policy can protect your business, tools and equipment, and the projects you are working on from the cost of damage or loss resulting from matters beyond your control. That includes coverage for an unexpected accident or damages and losses suffered because of severe weather during construction.
What is construction insurance?
Construction liability insurance is a policy custom designed for construction contractors to protect them against specific risks they may encounter, such as third-party injuries and property damage. Mistakes can happen, and potential lawsuits against your business can leave your operations damaged beyond repair.
What does it cover?
As a construction company or contractor, your projects could range from building a townhouse to repairing a major highway. It is essential to have insurance coverage specifically designed for the risks you encounter and the equipment you own. A comprehensive construction liability insurance package will typically include the following:
- Commercial General Liability (CGL) Insurance: A must-have for all kinds of businesses, CGL, also known as general liability insurance, protects your business from third-party bodily injury and property damage claims. It is designed to cover legal, medical, and repair or replacement costs for third-party injuries or damages that occur in relation to your business’s activities whether on your business’s premises, or at the construction sites where you work.
- Builder’s Risk Insurance: Builder’s risk insurance protects your project from start to finish, including the building, the building materials you have onsite, and losses or damages suffered following an insured event like a fire, theft, or vandalism.
- Commercial Property Insurance: Also known as business contents insurance or business property insurance, commercial property insurance protects your place of business or office and its contents from damage or loss related to severe weather, natural disasters, fire, theft, and vandalism.
- Tools and Equipment Insurance: Think of tools and equipment insurance as a form of property coverage for the tools and equipment you transport and use at a construction site. It is designed to reimburse you for damages or losses to your equipment if they’re stolen, vandalized, or damaged by a fire or flood. It covers a broad range of tools and equipment from handheld tools and safety gear to heavy construction vehicles such as bulldozers and backhoes.
- Pollution Liability Insurance: It’s not uncommon for construction businesses to be exposed to liabilities related to pollution while working at a jobsite. Pollution liability insurance helps to safeguard you from those risks. It covers third-party bodily injury and property damage as well as environmental damage resulting from your work, including clean-up costs, civil fines and assessments, and emergency response expenses.
- Commercial Auto Insurance: Construction companies typically have several vehicles to transport materials, tools and equipment, and people. A personal car insurance policy is unlikely to cover any accident or damage claims for a vehicle that’s used for business purposes. A commercial auto insurance policy protects you from costly third-party bodily injury or property damage claims involving your company’s vehicles.
Does a construction company need insurance?
Whether you provide commercial, industrial, or residential construction, there may be risks of third-party injuries and property damage resulting from work-related accidents. Construction liability insurance is needed to provide financial protection should you or your employees be named in a lawsuit.
We’ve helped thousands of Canadian construction companies and trade contractors get insured. Some of our clients include:
How much does it cost?
The cost of insurance for a small-to-medium construction company typically starts at around $540 per year for a commercial general liability insurance policy with a $2 million limit.
There are several factors considered when determining a price for your insurance policy package, including:
- Project types (commercial, residential, or industrial)
- The kinds of operations you perform like demolitions, tunnelling, drilling, or mining
- Whether structural work is required such as raising or moving built structures
- If you use flammables or explosives
- Years of experience
- Number of employees and their levels of experience
- If the construction projects you do are in areas that have a high crime rate
- The tools and equipment you own
- Previous insurance claims
- Annual and projected gross revenue
We shop more than 50 Canadian insurance providers in our partner network to offer you different options that suit your business needs at the best price.
Common claims scenarios
Frequently asked questions