Tree service is a challenging and hazardous job, especially when it involves working with heavy equipment. That’s why it’s important to make sure your tree service provider is fully insured.
General liability and workers’ compensation are two insurance policies that every tree services business needs. It’s also important to get commercial property insurance as well.
General Liability Insurance
If a customer’s property is damaged while on your job site or during a tree trim, general liability insurance can help pay to repair the damage. It can also help cover claims for bodily injury and property damage.
General liability coverage protects you and your business from claims of bodily injury, property damage and product-related lawsuits. This policy can be included in a business owner’s policy (BOP) or purchased as a stand-alone policy.
A commercial umbrella or excess liability extends your general liability policy’s limits. This coverage can cover claims that exceed your primary policy’s limits, such as a lawsuit against a competitor or medical claim related to the use of pesticides in your business.
A tree service company’s insurance needs depend on a number of factors, including area risks, previous claims filed against the business and industry standards. A qualified agent can help you evaluate your specific needs, and find the right policies to meet them.
Workers’ Compensation Insurance
Workers’ Compensation Insurance is a type of liability insurance that protects businesses from claims made by employees who are injured while performing work. This insurance typically covers medical costs and lost wages.
In the tree service industry, the cost of a worker injury can be catastrophic. It may cause a worker to be permanently disabled, or it could even bankrupt your business.
Most states require workers’ comp for all businesses, even if you have just one employee. In some states, it is optional, but it’s never a bad idea to have this coverage in place.
Insurance premiums are based on a combination of a company’s class code, payroll and experience modification rating. Insurers use this information to determine how much a company will pay for workers’ comp. The higher your class code and the more claims you have, the more you will pay. Generally, high-risk industries, such as tree services, have higher premiums than low-risk businesses.
Commercial Auto Insurance
As a tree service professional, you need a tailored insurance package to protect your business. That means you need general liability, commercial auto and commercial property coverage.
General liability insurance is a broad policy that covers common risks arborist businesses face, including customer property damage and client injuries. It can also help pay for legal fees if a client files a lawsuit against you for negligence.
Commercial auto insurance is a specific type of business insurance that covers vehicles used by your business for work purposes. It can cover both your business-owned and leased cars, trucks or trailers in the event of an accident.
Drivers’ driving records may play a role in how much you pay for this coverage, so it is important to hire drivers with excellent driving histories. You can also lower your premiums by choosing vehicles that are safe and well-maintained. Adding safety features to your vehicles, such as airbags, can help reduce your risk of accidents and theft.
Commercial Umbrella Insurance
If your business has a risky industry, such as construction or installation, or your company frequently works on other people’s property, you may need commercial umbrella insurance. This type of policy offers protection from lawsuits that exceed a CGL or auto liability policy’s limits.
This is especially important for tree service businesses that have a high risk of third-party injury or property damage. It also helps protect tree service companies from workers’ compensation claims that are denied by health insurance policies.
Umbrella insurance does not become active until your underlying policy’s limits are met, so this type of coverage is best bought at the time your business incurs an accident.
Umbrella insurance can be purchased independently or with other business insurance policies, such as general liability and workers’ compensation. You do not need to have your umbrella policy with the same insurance carrier as your other policies, but it can be beneficial to shop for these three policies at the same time to see if you can get a good discount.