How Much Does Welding Contractor General Liability Insurance Cost
General liability insurance is a policy that covers general lawsuits that small entrepreneurships face. Some of the common lawsuits that general liability insurance covers include physical injuries either to clients or employees and damage of property. Regardless of the size of a welding business, it is susceptible to risks and hazards that can lead either to physical injury or property damage. Lawsuits from such hazards can financially paralyze a business and lead to its collapse. This makes general liability insurance indispensable for welding businesses. General liability for welding contractors typically covers workers compensation in case of injury, equipment and property damage.Factors determining the cost of a welding contractor’s general liability insurance
The cost of welding contractors’general liability insurance is not fixed but varies based on a number of factors. Here is a rundown of some of the factors that help in determining the cost of general liability insurance for welding contractors.
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1) Size of a contracting firm
The bigger the business is, the more vulnerable it is to hazards that can lead to lawsuits that will cost the business both its reputation and financial expenses. Therefore big welding contractors generally pay a higher amount on general liability insurance. This is because big welding contractors have access to more clients and deal with expensive equipment and property hence if damage is done, it will be extensive.
The revenue that a welding contractor gets essentially showcases the number and size of contracts it executes. From the amount of revenue generated, an insurance company is able to determine the cost of a general liability insurance policy. Welding contracting firms with high revenue are more vulnerable to lawsuits compared to the ones with relatively lower revenue.
3) Claims History
Has a welding contractor been sued in the past? Does it have a reputation for constantly going through legal battles? This is a major determinant of how much general liability insurance will cost. If you have been sued in the past, it fuels the motivation of other potential claimants. Additionally, you are more vulnerable to paying compensation if taken to court because the general perception of your business is that it is capable of negligence. If a welding contracting firm has a clean sheet when it pertains to lawsuits then general liability insurance cost is considerably lower than if there is a history of lawsuits and claims.
It is the prerogative of any welding contractor to reduce insurance expenses so as to increase disposable income. The most efficient way a welding contracting firm can reduce the cost of general liability insurance is to proactively manage the possibility of risks happening so as to reduce general liability insurance costs.
A business that demonstrates the ability to stay clear of lawsuits generally pays less when it comes to general liability insurance. In order to significantly reduce the potential of risks actually occurring welding contractors need to develop a well thought out risk management plan. A typical risk management should include:
- An extensive employee training program on handling equipment and property
- Acquisition of a reliable security system
- Reducing hazardous features at the premises to create a safe working environment where employees are less likely to get injured and property is safe from harm.
- Investing in the acquisition of quality welding equipment that is made with the users’ safety in mind.
In a nutshell, the cost of a welding contractor’s general liability insurance is not fixed but varies based on the factors described above.