Make A Claim Against Contractor Insurance.

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“Several potential pitfalls exist in the construction trade. Some mistakes and accidents happen, and some of these issues can be extremely expensive. Someone must pay to make things right. Whether it’s the contractor who causes property damage or a third party who gets hurt.”

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Make A Claim Against Contractor Insurance.

Most contractors will start a claim against their insurance policy to address these issues, as that’s what insurance is for. Can the property owner submit a claim if the contractor’s insurance does not cover all or some of the costs? Moreover, what if the insurer does not cover all or some of the costs? Here we will learn about Make a Claim against Contractor Insurance. Let’s start!

 

Contractor Liability for Property Damage

As contractors, we face a great deal of risk daily. General liability insurance provides a way to limit these risks. Due to this insurance, the contractor is generally protected from financial liability if their property is damaged by customers, neighbors, or any third party not involved with the project. As a safety net, it protects us against suits for injuries caused by people not on our payroll. General liability generally covers individuals other than employees or officers of the company (although policies may vary).

 

State Requirements about make claim against Contractor Insurance

General liability insurance is usually a requirement for contractors applying for a state or city license. Applicants for trade licenses must provide a policy proving that they carry general liability insurance (along with other policies) worth the state’s or cities’ minimum requirements.

 

Is There A Time When General Liability Is Not Enough?

Even though most states need contractors to carry minimum insurance limits before securing a license, these limits are simply minimums. Contractors can elect to carry policies worth much more. Accidents often exceed minimum insurance limits. In the example of replacing a retaining wall on a homeowner’s property, torrential rains occur between demolishing the old wall and constructing a new one, causing the ground to slide.

As the rainwater and wet earth roll downhill, several home structures are destroyed. The minimum general liability limits may run out as the claims start coming in on this one incident.

 

Does The Contractor’s Insurance Cover Claims?

How about filing an insurance claim against a contractor? Generally, we can make claim against contractor insurance for three types of injuries against a contractor’s insurance. These are injuries to the contractor, injuries to the property owner, or injuries to third parties. The contractor is responsible for making things right if there is accidental damage. It may be necessary for the contractor to pay for the damage out of pocket to claim the losses during tax season and keep their general liability premiums the same.

Alternatively, they can file a claim with their insurance company. Sometimes, they may even have to pay out of pocket for the damage and then try to recover the funds from their insurer. It might take some time for a homeowner or third party to experience any of those scenarios. There’s no legal definition of “reasonable time,” and definitions can vary from state to state. If the contractor responds, giving him a good-faith chance to fix the problem is preferable.

A contractor’s insurance might not cover all eventualities, so a property owner or third party must file their claim. Instances include:

  • There is no acceptance of responsibility for the accident on the part of the contractor
  • There is a refusal to communicate by the contractor or a dodging of the affected party by the contractor.
  • Unresolved for a reasonable period

An owner of the property or a third party can claim damages from the contractor’s insurance in any of the above scenarios.

Note: Property owners should get a copy of the construction insurance claims information before the project starts. A neighbor, passerby, or the municipality may go after the property owner’s insurance policy for damages. A property owner can share the contractor’s insurance policy information with a harmed third party to prevent claims against their insurance policy.

 

What If The Insurance Company Won’t Pay?

It is not necessarily true that a contractor’s insurance company will pay an insurance claim because the claim has been filed. The provider can refuse a claim for several reasons, including:

  • The insurance policy doesn’t provide coverage for this kind of damage.
  • The policy is due to expire.
  • The coverage was not renewed, causing damages.
  • The negligence of a contractor caused the damage.

However, this is not an exhaustive list. Remember that the insurer will only pay for damages up to the policy limits. For example, if the damage estimate is $40K and the policy limits are $25,000 per occurrence, the insurer does not have to cover the additional $15,000. Property owners can act in these situations by:

  • Recover the money by filing a claim against their homeowner’s insurance (less the deductible).
  • For reimbursement, submit a claim against their homeowner’s insurance and have their insurer contact the contractor’s insurance company.
  • Hire a lawyer and sue the owner of the company for personal liability.

Even though there are other options, they are likely to be expensive, time-consuming, or both. Suppose property owners want to avoid this altogether. In that case, they should vet their potential contractors thoroughly and ensure they are covered, capable, and experienced — and quickly resolve any problems.

 

Common Claims Scenarios Every Contractor Should Know

Can I file a claim against my contractors insurance? The world of construction is full of hazards. Read on to learn six common insurance claims contractors often experience and how your policy can help you avoid them. You likely run a small business as a trade professional or contractor.

 

Common Claims Scenarios Every Contractor Should Know

 

And accidents happen – especially in the construction industry. Understanding how your coverage can protect you from unexpected claims or lawsuits can help prevent bodily injury, property damage, or theft of your expensive tools and equipment. You can make a claim against your customize your contractor insurance policy in a variety of ways. Read on to find out what coverage you can expect and what the insurance companies cover.

 

Some Other Common Claims against Contractors’ Insurance

In the following six scenarios, you can file a claim due to the unexpected.

 

PERSONAL INJURY OR PROPERTY DAMAGE

How can contractors insurance protect you? Accidents in the construction business can cause injuries to third parties (non-employees) or damage your property. Whenever these accidents occur, they can cost you a lot of money. A slip-and-fall accident accounts for 10% of liability claims, costing an average of $30,000. Can your business afford that? While touring the progress of your remodeling, the owner of the home trips over the cord of a power tool left ft out by one of your workers, causing her to hurt her wrist and strike her head.

A ride in an ambulance and an overnight stay in the hospital later, she is blaming you. The truck crashes through the living room when an employee accidentally hits the gas pedal instead of the brake while backing into a client’s driveway to offload some materials. It may have been accidental, but this property damage will cost you.

The owner only hired you to remodel her main bedroom and bath. Widening the living room wasn’t part of the contract. In case of job site accidents, general liability insurance will protect you. General liability insurance for contractors covers the following:

  • Bills for medical care
  • Absence from work
  • Repairing damage
  • Replacement of damage

The daily contractor insurance liability can also cover the following expenses if you sue for injuries or damage:

  • You owe the plaintiff judgments and damages
  • Fees for attorneys
  • Court costs, including evidence expenses

 

WORKER INJURY

Construction is a high-risk industry. Unfortunately, worker injuries will happen no matter what profession you specialize in. 2.9 million workers suffered injuries in 2016, with an average of 14 workers dying daily. Construction was responsible for more than 21% of the fatalities. A workers’ compensation policy will protect you in a work accident.

While assisting another employee with roof repairs, your project manager loses his balance, throwing them both to the ground. Fortunately, they landed in the grassy backyard rather than the paved drive. Unfortunately, they both were injured, and your manager will be out of commission for a while because of a neck injury. During recovery, your project manager will lose wages and medical bills. It covers the following:

  • Bills for medical care
  • Wages lost
  • Ongoing rehabilitation
  • Litigation
  • Death benefits and funeral expenses

Workers’ compensation protects your business against the high litigation costs when your hardworking employees are injured while working for you.

 

TRAFFIC ACCIDENT

Many construction workers spend their days running supplies, checking progress, and preparing bids, but not all businesses are there. Auto coverage may not protect you when you use your car for business. As you’re getting ready to submit a bid for a large home addition across town, you just finished checking on the kitchen remodel your crew is on the way to. When you hit a green light, you gas it and drive just as someone in cross traffic runs a red light, t-boning your truck.

Unfortunately, you have no serious injuries. The other driver does not have insurance. Ensuring commercial auto insurance covers your work truck and other insured work vehicles is essential. Commercial auto insurance protects the following types of cars:

  • Liability coverage – provides coverage if you are responsible for the damage/injury of someone else
  • Comprehensive & collision coverage – Protects your vehicle against damage caused by negligence.
  • Medical payment – pays if your passenger gets an injury.

In the event of an accident, you’ll have coverage if you take care of all your bases regarding commercial auto insurance.

 

STOLEN EQUIPMENT

Your business ceases to function when your equipment is damaged or stolen while being transported between job sites. If your tools go missing, do you have the resources to replace them? Less than 25% of stolen construction equipment returns to its owner yearly. A long day ahead.

You stop at a coffee shop to grab a large coffee before heading to your first job site. When you return to your work truck, your backseat window shatters, and your tool belt is missing. You already have a tight deadline with this job, so you’ll need every tool to complete it. It typically covers the following when tools and equipment are away from your business location:

  • Defeat
  • Fraud
  • Injuries
  • Invasion of privacy

With tools and equipment coverage, you’ll always have the necessary tools and equipment to run your business.

 

DAMAGE TO BUILD-IN PROGRESS

The risk of losing a project is great while it is still in progress. The tools you invest your time in, the materials you use, the supplies you buy, and the machinery you operate are all vulnerable to damage or theft on the job site. What happens if I lose or the contractor damaged my property these valuables? A build can go wrong, for example, due to wildfires.

There have been billions of dollars in losses from the CA wildfires alone in 2018, even before the three fires began raging the first week in November. In just 80 seconds, the Camp Fire will burn 80 football fields. Its path is certainly paved with unfinished construction projects. Construction sites are not the only places at risk of damage from fire and weather. Thieves and vandals also frequent unmanned sites.

Can you afford to pay for damaged equipment and unfinished projects when the unexpected happens? As you wrap up the day’s work, you lock up the fence enclosure around the job site and secure your backhoe and other tools to be used again in the morning.

  • Structure damage is in progress
  • Theft on site
  • Weather-related damage

You won’t have to pay out of pocket for unforeseeable issues at a job site if you take out builders’ risk insurance to cover cleanup and restarting damaged projects or replacing important equipment. The right insurance claim contractor coverage protects you against these common contractor insurance claims so your business can thrive.

 

Bottom Line

As a result of completing this type of work numerous times, a client hires a mason to update the facade of her home. This causes the facade to detach from the house, and the client sues. The mason’s insurance will cover his legal fees and repair expenses.

Hedy Ghavidel

HEDY GHAVIDEL Managing Attorney  Roseville Office  1-866-471-6981  info@attorneysre.com Bio...

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