Trades / Construction Insurance

As one of the major industries that drive Canada’s economy, the construction sector employs more than 1.2 million individuals. Additionally, this sector is predicted to have a Compound Annual Growth Rate (CAGR) of 8.5% by the year 2024. This will mean that the construction sector will soon be worth around $354.9 billion USD.

This promising growth is something that a construction contractor or other similar business can look forward to. The same can be said about the trades that feed into this industry including plumbers, electricians, carpenters, and more. These professions all combine to create the backbone of the Canadian economy. They are the ones responsible for completing construction projects like casinos, theme parks, train stations, bus stations, airports, apartment blocks, houses, and more!

These are high-pressure jobs that are always in demand, and that can lead to costly mistakes. There is little room for error through the course of construction and businesses are always faced with risks on the job site and beyond. These risks include property damage, damage to unfinished buildings, third-party injuries, construction worker injuries, and much more.

In order to protect your business from the above scenarios and ensure success in completing more construction projects for years to come, sufficient insurance coverage is key. That’s why KASE Insurance, a top-notch insurance broker in Toronto, works so hard to provide customized construction insurance policies to meet the insurance needs of each client, thereby protecting businesses from various trades/construction risks.

What is Trades/Construction Insurance?

Trades/construction insurance is a group of insurance policies that can be mixed and matched depending on the insurance needs of a business operating within the construction sector or in related trades. Trades/construction insurance provides the needed insurance coverage for various risks that are present within a construction site, around a construction site, in relation to vehicles/equipment contracted for a construction site job, or in relation to other assets of the business.

Mainly, trades/construction insurance provides coverage in situations such as:

• Business operations cause third-party injury or third-party property damage
• Third-party individuals are injured within your main office
• Business operations cause injury, illness, or death to workers in the construction project
• The unfinished construction project is subjected to physical damage from harsh environmental conditions
• Equipment/tools are stolen or vandalized
• Vehicles get involved in an accident or are stolen/vandalized

Like other types of business insurance, there is no one-size-fits-all when it comes to trades/construction insurance. A trusted insurance broker like KASE Insurance would be willing to take the time and assess your business needs carefully before recommending a trades/construction insurance policy for you.

Why is Trades/Construction Insurance So Important

Having the right business insurance is a universal best practice for businesses across all industries. However, different businesses face different levels of risk. This is why adequate risk assessments from an insurance broker or insurance company is crucial. These assessments are usually done before an insurance quote is given.

However, construction businesses or businesses involved in related trades face a high level of inherent risk when compared to other industries. This is because the construction job site poses numerous hazards to the workers involved, to the suppliers, partners, clients (or their representative), and even to the general public who are passing close to the job site.

One of the main sources of risk is working from a height – which is common in many construction sites. Accidents like falls or falling materials can lead to serious injuries. Moreover, the use of heavy machinery poses risks because even small mistakes can lead to dire consequences. Additionally, construction sites that are close to third-party properties are at risk of inflicting property damage which can lead to hefty legal and repair costs.

Considering the above risks along with how competitive the construction industry is, businesses can benefit from having a trades/construction insurance policy that will help them minimize legal, medical, repair, and/or replacement costs as much as possible.

What Does Trades/Construction Insurance Cover?

There are a number of different insurance types or coverages available for construction businesses and those in related trades. These are usually put together by insurance brokers or insurance companies based on the biggest risks associated with your business.

General Liability Coverage

General liability insurance coverage protects your business from two main things: third-party injury and third-party property damage. Third-party individuals refer to the general public, clients, potential clients, partners, and suppliers. Meanwhile, third-party property would pertain to private and public property that is not affiliated with your business.

In the event that third-party injuries happen in relation to your business operations or within your business premises (construction sites included), general liability insurance will cover legal and medical costs. In the case that your company is held responsible for property damage, general liability insurance will cover the repair/replacement costs.
Professional Liability Coverage

Professional Liability Coverage

Also known as the errors and omissions (E&O) insurance, this type of insurance protects your business in the event that your company commits errors or perceived errors in terms of design or actual construction.

E&O insurance also covers you in the event of delays in the construction schedule or additional costs that lead to lawsuits or claims from the client. As a builder, you will encounter construction projects for difficult or litigious clients; this type of insurance protects you from such a risk. Moreover, in the event that errors lead to damages and injuries, you will also be covered with professional liability insurance.

Worker’s Compensation Insurance Coverage

Construction sites are considered as one of the most dangerous workplaces out there. Accidents like falls, slips, trips, electrocutions, and the like can happen to even the most experienced construction workers. This is why it’s important to have worker’s compensation insurance.

In the event that your employees suffer from injuries, illnesses, or even death while performing their job tasks, worker’s compensation insurance will cover medical costs, lost income while recovering, and death benefits.

Pollution Liability Insurance Coverage

Accidental improper waste disposal, mishandling of hazardous chemicals, perceived aggravation of legionella/mould during the course of construction can lead to steep pollution or environmental claims. Pollution liability insurance helps to cover legal costs in such cases while also providing assistance for cleanup costs and needed emergency response costs.

Surety Bonds

Various contract surety bonds may be required as you get started on a construction project. Essentially, contract surety bonds enable a construction company to reassure clients or project owners that the terms of the contract for the project will be met. Though this is not like other types of risk insurance, these are typically provided by insurance brokers if it is needed for your project.

Builder’s Risk Insurance Coverage

Unfinished buildings can be vulnerable to the elements (e.g. bad weather, floods). Furthermore, the tools and equipment used in the course of construction are susceptible to theft, vandalism, or damage. This is what’s referred to as builder’s risk. Builder’s risk insurance helps to cover your business in the above scenarios, providing coverage for repair/replacements costs.

Inland Marine Insurance Coverage

Inland marine insurance can cover various types of property/equipment used through the course of construction such as those in transit, mobile equipment, and borrowed equipment.

This insurance policy is also known as tool and equipment insurance. With this kind of insurance protection, you will have coverage for repair/replacement costs in the event that equipment and tools (e.g. generators, excavators, forklifts, computer equipment, etc.) are damaged while in transit, damaged in a fire, stolen from the site, or vandalized.

Installation and Tool Floater Insurance Coverage

Certain materials or fixtures that are not yet installed into the structure (e.g. countertops, toilets, sinks, and lights) have a high risk of getting damaged. It can happen while these items are in transit or while they are being moved around the site, but such damages can lead to additional costs. If the additional costs are too high because of extensive damage, this can result in a legal claim from the client.

This is where installation and tool floater insurance comes in. This type of insurance protection covers the repair/replacement costs for uninstalled materials/fixtures that are damaged or stolen. The coverage can also extend towards tools used in the project – generally those valued at $1,000 or less.

Commercial Property Insurance Coverage

Construction insurance is not only about protecting your construction site. You would also need to have coverage for your physical office space and the valuable items, tools, and equipment that it houses. Commercial property insurance covers the repair/replacement costs in the event that your workplace or its contents sustain damage. If such damages also lead to business interruption, this type of insurance will also reimburse the lost income.

Commercial Auto Insurance / Truck Insurance Coverage

If you have a fleet of vehicles or trucks utilized throughout the course of construction, then commercial auto insurance or commercial vehicle insurance will serve you well. This kind of insurance will provide coverage for legal, medical, and repair/replacement costs in the event that your vehicles or trucks get involved in an accident. This insurance policy will also provide coverage for instances of stolen/vandalized vehicles or trucks.

Who Needs Trades/Construction Insurance?

There are different kinds of construction businesses that will benefit from having a trades/construction insurance policy in place. If your business is listed among the following or operates in a similar way, trades/construction insurance will serve you well!

• General Contractors
• Small Renovation Contractors
• Owner-Builders
• Real Estate Developers
• Construction Program Managers
• Program Managers
• Package Builders

Specialized trades/construction insurance is also needed if you or your business does any of the following related trades or something similar:

• Brick masonry, block masonry, stone masonry
• Cement masonry
• Carpentry
• Drywall and ceiling installation
• Elevator installation
• Construction equipment operation
• Electrical wiring installation or maintenance
• Plumbing and pipefitting
• Gas work
• Roofing
• Sheet metal work
• Iron and steel work

Why Choose KASE Insurance?

KASE Insurance is a trusted and award-winning insurance broker situated in Toronto, Canada.
We provide different business insurance types for companies of all sizes and in all industries. Our coverages range from helping the smallest tech company against cybercrimes or the loss of cryptocurrencies all the way to the largest legal firm against errors, omissions, and other liabilities.

One of the areas we provide the most cover for is the construction industry. We can give your construction/trades business a tailor-fit insurance policy that best fits your needs and your budget. Our innovative solutions and customer-first approach ensures you will always get the attention you deserve and the coverage you need. In an increasingly litigious world, it is important to make sure your business has sufficient risk management. We’re here to help!

If you have questions for us, we would be very happy to help. Contact us today or get started with a quick insurance quote!