Whether you’ve been hired to replace kitchen fixtures, install drywall in a client’s home or do general repairs in a fixer-upper, many things can go awry while you’re on the job. For example, you could accidentally knock over a can of paint and ruin your client’s antique furniture. Or you might get into a car accident on the way to a job.
As someone with a wide range of skills, you can think of handyman insurance as a small business insurance policy that’s customizable to fit a wide range of needs.
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Who Needs Handyman Insurance?
As a jack-of-all-trades, you could be doing anything from mounting televisions to repairing gutters to fixing minor plumbing issues. It’s hard to predict the types of problems that can arise out of such a wide variety of tasks. That’s why you need the best small business insurance.
If you perform tasks such as the examples below, it’s worth considering handyman insurance:
- Carpentry
- Ceiling fan installation
- Concrete work
- Decks and patios
- Door installation
- Drywall installation
- Electrical work (such as installing light fixtures)
- Floor installation and repair
- Framing
- General maintenance
- Gutter cleaning
- Home security installation
- Moving furniture and other items
- Painting (interior and exterior)
- Remodeling (such as a bathroom or basement)
- Plumbing repairs
- Tiling
- Staining furniture
- Stonework
- Waste and junk removal
- Window installation
What Does Handyman Insurance Cover?
Handyman insurance is a policy with a handful of different types of small business insurance that protects your business from a range of issues, including medical expenses for accidental injuries to others, lawsuits and damage to your business property.
A good place to start is with a business owners policy (BOP). A BOP bundles three important coverage types and it’s usually cheaper than buying each coverage separately.
Here’s what’s in a BOP:
Business liability insurance
This is a core coverage type that covers property damage and accidental injuries caused to others (not including your employees). For example, if you accidentally knock a hole in the wall while moving furniture, your general liability insurance can pay for repairs.
Your liability insurance also covers your legal costs, judgments and settlements if you are sued because of an accident. For example, if someone (not including your employees) gets hurt on your job site, your liability insurance can cover their medical expenses and the cost of a legal defense if you are sued.
Commercial property insurance
This covers the physical location of your business and business equipment if they are damaged due to a problem covered by your policy, like a fire or tornado. Commercial property insurance covers owned and leased equipment, including business records, inventory, office computers, office furniture, tools and supplies.
Business interruption insurance
If you have to temporarily shut down your business due to a problem covered by your policy, business interruption insurance replaces your lost income. This coverage is also known as “business income insurance” and covers problems like theft, wind damage, temporarily moving to a new location and money lost due to damaged merchandise.
Other Small Business Insurance Types
You can add additional coverage types to your handyman insurance beyond standard BOP insurance. It’s a good idea to speak with your insurance agent to make sure you only buy what is necessary for your handyman business.
Here are some common coverage types to consider:
Commercial car insurance
This covers your cars, trucks and vans that you use for work purposes, such as transporting tools and work materials to a job site. Your personal car insurance won’t cover you for business uses of a vehicle.
Here are the usual coverages types available with commercial auto insurance:
- Bodily injury liability. This covers accidental bodily injuries to others caused by you or your employees.
- Property damage liability. This pays for accidental property damage caused to others by you or your employees. For example, if you accidentally hit your client’s car while backing into the driveway.
- Medical payments and personal injury protection (PIP). This covers you and your passengers’ medical expenses no matter who is at fault for the car accident.
- Collision insurance. This pays to replace or repair your work vehicle if you or your employees get into a car accident.
- Comprehensive insurance. This covers the cost to replace or repair your work vehicle for problems like vandalism, theft, fire, floods and falling objects.
- Uninsured motorist (UM) coverage. This pays the medical expenses of you and your passengers if you’re hit by someone who doesn’t have car insurance or someone who does not carry enough car insurance. You can add UM to pay for damage to your vehicle from an uninsured driver in some states.
Commercial umbrella insurance
If you want an extra layer of protection on top of your general liability insurance, consider buying commercial umbrella insurance. For example, if your handyman business gets sued for $700,000 and your general liability limits are $500,000, umbrella insurance would cover the $200,000 shortfall.
Equipment breakdown insurance
If you rely on certain tools and machinery to perform handyman duties, this insurance type covers the cost of repairing or replacing your equipment due to unexpected breakdowns. Equipment breakdown insurance does not cover normal wear and tear.
Hired & non-owned auto insurance
If you or your employees use a personally owned or rented car for work purposes, this covers property damage and injuries accidentally caused to others. For example, if you cause an accident while driving a rented van to a work site, this would cover the other driver’s medical expenses and car repair bills.
Inland marine insurance
Also called “property in transit,” this covers mobile machinery and tools while in transit to the job site. You can also add an installation floater endorsement that covers your equipment, machinery and materials while awaiting installation.
Here are two types of inland marine insurance to consider for your handyman insurance business:
- Contractor’s tools and equipment insurance. If your tools and equipment are damaged, lost or stolen, this covers the cost of repairing or replacing them. For example, if someone steals your power saw, this coverage will pay to replace it.
- Installation floater insurance. This covers materials being installed at a job site, stored or transported. For example, installation floater insurance would cover floor tiling that has been loaded onto your truck to be installed at a client’s home.
Surety bond
You may be required to have a surety bond to get a business license or permit. A surety bond covers the cost of claims about incomplete or poor workmanship, as well as theft and fraud.
Workers compensation insurance
Most states require you to have workers compensation insurance, even if you only employ a single worker. It covers lost wages, medical expenses and disability benefits if your employees get injured or ill while performing work-related duties.
What Does Handyman Insurance Not Cover?
Handyman insurance doesn’t cover several types of problems. Typical exclusions include:
- Earthquakes
- Floods
- Government seizures
- Infectious diseases
- Intentional and fraudulent acts
- Wrongful termination (you will need employment practices liability insurance)
Examples of Handyman Insurance Claims
Here are some examples of claims scenarios and the handyman insurance coverage type that would apply.
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How Much Does Handyman Insurance Cost?
Handyman insurance costs an average of $2,795 a year for a policy that includes general liability insurance, commercial auto insurance and coverage for contractor’s tools and equipment, according to Insureon.
But your handyman insurance costs will depend on several factors, such as:
- The location of your business. Where your business is located can impact the cost of your policy.
- The number of employees. The more workers you employ, the higher your workers’ compensation insurance cost.
- The size of your payroll. This can impact the cost of your business insurance.
- Your business assets. How much your work vehicle, equipment, tools and supplies are worth, as well as any other business property you own, are also taken into consideration.
- Insurance coverage needs. The coverage types and coverage amounts you buy will impact the price of your business insurance policy.
- Deductible. A deductible is the amount subtracted from an insurance claims check. Increase your deductible and you’ll see a decrease in your premium. If you have a lower deductible, your premium will be higher.
- Prior claims history. Your past business claims history will also be factored in when determining rates.
Example of the cost of handyman insurance
Here’s a look at an example of how much handyman insurance costs, depending on what types of coverage you purchase. Your costs will vary depending on cost factors like your insurance needs, if you employ any workers and other factors, such as your business assets.
How to Find the Best Handyman Insurance
Here are some tips for finding the best handyman insurance for your needs:
Gather the requested documents
Before you start shopping for handyman insurance, you’ll want to make sure you have all the necessary information and documents. This includes:
- Basic contact information
- What your business does
- Number of employees
- Location of your business (and if you rent or own the building)
- Proof of how long you’ve been in business
- Estimated business revenue for the current year
Bundle your business insurance
A great way to build your handyman insurance is with a business owners policy (BOP), which bundles three core coverage types: general liability insurance, business interruption insurance and commercial property insurance. Bundling these policies together is usually cheaper than buying them separately.
You can add more coverage types as needed. For example, if you have a business vehicle, you can bundle your commercial auto insurance with your BOP.
Shop around
Once you have gathered your documents and decided what coverage types you need for your handyman insurance, it’s a good idea to compare business insurance quotes among several insurers. You can get free business quotes online or by speaking with an independent insurance agent.
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