Painting Contractor Liability Insurance: What Is It?
Painting contractors often struggle to find quality insurance. Working on ladders, at high heights, comes with risks that many insurers shy away from. From finding an insurance company to work to understanding complex certificates of liability, painters can often find themselves in a tough position when trying to get comprehensive coverage.
To get the best price on your insurance without sacrificing essential coverage that will protect your income in the event of an accident, it is critical to know what policies you need and what the fine print says on each. To guide you, this article is an introduction to painting contractor liability insurance.
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Why do painting contractors need insurance?
Here are the top three reasons to purchase painting contractor liability insurance:
1. Property Owners Or General Contractors Require It
Often, painters need business insurance because their clients (general contractors or property owners) require it. Painters must issue their clients a certificate of insurance each year.
Your customer wants to know that insurance will cover any damages that may arise from your painting operations.
2. A Lawsuit Could Bankrupt Or Harm Your Business
Painters should purchase commercial insurance to protect their business in case they injure someone or harm property and cannot afford to pay for damages out of pocket. Litigation costs are rising, as are the settlement amounts being awarded in civil suits.
3. State Law Requires It
Painting companies are often required to purchase certain forms of insurance by their state governments. For example, workers compensation (often called employers liability) insurance is required if you have employees, and commercial auto insurance is required if you have a work vehicle titled in the business name.
What coverages do painting contractors need?
Most painting contractors will purchase the four insurance coverages below. That being said, you might need other policies depending on the size and type of painting jobs you take on. This is just a starting point:
Commercial General Liability
General liability insurance for painters covers bodily injury and property damage that you cause to third parties (people other than you or your employees) for which you are legally liable.
Claims that fall under this category are often claims of overspray, paint spills, and property damage caused by ladders.
Contractor Tools Coverage
This isn’t liability coverage, but it’s usually bundled with your general liability policy and is important for painting contractors.
As a painter, you might keep your tools in your truck, garage, or on the job site. Contractor tools coverage will protect those tools if something happens to them (usually theft). For a small amount each year—$50-$300, depending on your tools and coverage option—your tools can be covered at all the locations where you bring and store them.
Workers Compensation (Employers Liability)
Painting is a physical activity that often requires the use of ladders. Injuries from falls and other mishaps are inevitable. Workers compensation will pay for medical bills that your employees have as a result of getting hurt on the job. This policy will also cover lost wages and other benefits, depending on your state.
Commercial Auto Liability
If you have a work vehicle or use your vehicle for commercial purposes, you need a commercial auto policy. This policy covers your liability if you are in an at-fault accident and pays to repair accidental physical damage on your vehicle, regardless of fault.
For more information on the coverages you might need, check out our guide to contractors insurance, where we go over what coverages you will need at each stage in your business.
Example Claims Scenarios
To help illustrate the value of painting contractor liability insurance and how it can protect your business, here are some examples of common claims in the industry:
General Liability - Overspray Damage
Prime Colors Painting Co. was contracted to repaint an underground parking garage in downtown Springfield. The crew used sprayers without setting up containment barriers, as they underestimated the influence of exterior winds on the indoor environment. On the final day of painting, a breeze funneled through the garage's ventilation and deposited paint on luxury cars parked nearby. The claim for the extensive cleanup totaled $17,000. The general liability policy
that Prime Colors Painting held covered the costs, ensuring the cars were professionally cleaned without causing financial distress to the company.
General Liability - Hydraulic Hose Burst
Artistic Brush Inc. was painting the exterior of a client's high-end residence when a hydraulic hose on their aerial lift ruptured, spilling fluid onto the bespoke cobblestone driveway. The fluid left unsightly stains, and the driveway required professional restoration. The damage and restoration costs were covered under Artistic Brush’s general liability insurance, which included coverage for property damage occurring as a result of their operations. The claim was resolved quickly, maintaining the client’s satisfaction and the company's professional reputation.
Commercial Auto - Auto Accident
An employee of Spectrum Paintworks was driving the company van, loaded with painting supplies and equipment, to a jobsite. The employee was involved in a collision with another vehicle at an intersection, causing significant damage to both the van and the third-party vehicle, as well as injury to the other driver. Spectrum Paintworks’ comprehensive commercial auto insurance policy covered the damages to both vehicles and the medical costs for the other driver’s injuries, while the contractor’s tools and equipment policy paid to replace the damaged painting equipment. The claim included the cost of renting a replacement vehicle to ensure business continuity while the van was being repaired, allowing Spectrum Paintworks to complete their jobs on schedule.
How much does painting contractor insurance cost?
Depending on the type of painting jobs and how much work you do, insurance can start at around $800 per year for general liability and go up as your business grows. You can always get an instant online quote by clicking here.
LandesBlosch Recommendations
Here are four pieces of advice we always give to painting contractors:
Make sure you are classified correctly
Ensure your business is correctly classified on all policies, whether you're an interior, exterior, or industrial painter. Accurate classification on your liability and workers compensation policies is crucial for two main reasons:
- Avoid getting charged an additional unexpected premium when the insurance company finds out the type of work you are performing. And they will find out—via the first claim, your Facebook pages, your website, your Google reviews, and similar. When you go from a lower-rated class code to a more expensive one, you are at the mercy of the rate the insurance company assigns you and it is usually due in 30 days, instead of spread out over the course of a year.
- Prevent potential coverage discrepancies. If the insurance company discovers that not all operations were disclosed to them and your business was misrepresented, it will complicate getting those undisclosed operations covered.
2. Read and understand policy limitations & exclusions
Vigilantly review your liability insurance for exclusions that could impact your coverage scope. This is the fine print that’s very important to read and understand. For example, if your work involves heights, verify that there are no restrictions or know the permissible height limits. Also, be alert to exclusions specific to your operations, such as overspray or certain types of painting projects. And finally, be aware that not all policies cover damages caused by independent contractors or subcontractors.
3. Have a strong safety program
Implement a comprehensive safety program if your work entails heights. This not only helps to protect your employees but can also significantly reduce your insurance premiums over time by influencing your experience modification rate. With a lower claims history and high safety standards, you will have more options for insurance companies
4. Verify subcontractor insurance
Always collect and verify certificates of insurance from subcontractors to ensure they have adequate coverage. This not only mitigates your liability exposure, but is often required by your customers. If you have uninsured subcontractors or subcontractors, it will drastically increase the cost of your liability and workers compensation insurance.
Summary
If you are a painting contractor looking for different insurance options, let us know! We work with hundreds of contractors each year and partner with over 100 insurance companies to help you get the best rates.
About The Author: Austin Landes, CIC
Austin is an experienced Commercial Risk Advisor specializing in property & casualty risk management for religious institutions, real estate, construction, and manufacturing.