A big expense element in a contractor’s construction bid will always be the expense of the liability insurance for the project. The contractor’s existing general liability policy will not be sufficient to meet certain requirements of a particular job being bid for but upping the coverage on his regular liability insurance could leave the contractor in a grossly over-covered position after the job is performed. A per project policy is ideal for construction bid circumstances such as this.
A per project liability insurance policy is strictly what it reads as. The contractor can get a liability quote for exactly the required amount and for only so long as the precise job is underway. This means the contractor will have the correct amount of insurance at the proper time. He will not need too little through the job and will not have too much after the work is finished either. Per project general liability is fantastic for a contractor’s general liability.
Two critical factors is highly recommended when looking at per project insurance. The foremost is the utmost payable amount and the second is the actuarial claim rate.
The individual or more likely the organization tendering out the bid will stipulate the minimum amount of liability insurance requires. Suppose the mandatory insurable amount is for twenty million dollars. That total coverage could be required for the bid but through the general business of the contractor, perhaps ten million is a lot more than sufficient. Public and Products Liability insurance could be put in force simply for the term of the contract.
The other factor is the actuarial. That is the incidence of claims for a specific type of application. For instance, if the contractor does dangerous work like welding underwater the claim rates are much higher than work as an inside painter so the rate per thousand dollars worth of insurance will naturally be greater for the underwater welding. A contractor needing liability insurance may often be quoting for work that is of a different actuarial rate.
Administration of the contractor’s office and his doing quotes involves much less risk than completing the contracted work does so per project general liability would certainly be a better value than a global policy it doesn’t address the differing needs.
Per project contractor general liability insurance isn’t a completely new product but it is not a policy that a lot of insurance underwriters have not been overly eager to offer. Insurance agents prefer a long-term deal like a life insurance coverage that simply has premiums running to eternity and beyond. Per project coverage requires the insurance for only a fixed term and at a set rate. Per project general liability insurance is optimal for the contractor’s insurance and per project general liability insurance can still be found, and is certainly worth finding, even if it takes some extra looking.