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Amity Insurance stresses importance of liability coverage for contractors

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QUINCY, MA ISSUED JUNE 4, 2012….Adequate liability insurance is a must for contractors and subcontractors, as this type of coverage offers financial protection against accidents, injuries, and property damage caused during a project, according to Amity Insurance Agency, Inc., the region's leading full service agency.

When on a construction project, workers often accidentally damage property in one way or another; mishandled tools, dropped items or misinterpreted directions can result in such incidents. The regular standards of business require contractors and subcontractors to have proof of adequate construction liability coverage prior to starting a project on a structure. Commercial contractors are usually expected to carry multi-million dollar policies. This allows for coverage of any injuries or construction-related damages to the structure. As a rule, commercial contractors performing riskier tasks have higher coverage amounts; for example, a roofing contractor would have a higher amount than a contractor remodeling the interior of a one-story commercial structure.

Residential building insurance is important for any worker in the building industry. Quite often, homeowners decide to sue a contractor for damages sustained during the process of construction. If there are injuries on the job site, some workers may also file lawsuits against the contractor or homeowners. A good construction liability policy will protect contractors from loss in unexpected situations and a variety of lawsuits. However, the contractor must require every subcontracting party to have their own coverage. The contract should also state that the contractor does not claim any responsibility for damages occurring during the construction process that are the fault of one or more subcontractors.

Policy amounts are related to the amount of money the contractor executes, so it is important to estimate a realistic figure. To be fully protected, it's wise to have at least two or three times as much coverage as the total amount of the construction project.

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