How Are My Artisan Construction Insurance Rates Determined?

Managing job sites, coordinating schedules, and ensuring work quality are just a few of the tasks artisan contractors oversee each day. If you work in a specialized field like electrical, plumbing, or HVAC, you may wonder how the unique risks of your artisan construction business impact your insurance needs and rates.

In this post, Central’s senior pricing manager, Mark Woods, and senior commercial lines manager, Steve Laser, share insights on artisan construction insurance.

Read on to learn how artisan contractor rates are determined and how Central’s Business Owner’s Policy can streamline your coverage.

Who Qualifies as an Artisan Contractor?

Artisan contractors are highly skilled trade professionals who work as subcontractors on larger projects. They bring expertise and experience to construction and renovation.

“Artisan contractors typically focus on trades like HVAC, electrical, or plumbing,” Laser says. “However, many artisan contractors expand their services to include general repairs or maintenance, allowing them to work directly with homeowners or commercial clients as handymen.”

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Key Factors That Impact Your Artisan Construction Insurance Rate

Business Specific Risks
Artisan construction involves various work environments—from large-scale construction sites to residential homes—creating unique risks and exposures.

Example: An HVAC technician might handle hazardous refrigerants, an electrician works with high-voltage systems, and a plumber is at high risk of liability for water damage. Each scenario carries insurance requirements to safeguard against potential losses and claims.

Central’s underwriters utilize an “individual risk premium modification factor” to adjust premiums based on specific business risk levels, helping ensure rates reflect the risk each business poses. “We rely on the expertise and experience of our underwriters,” Woods says. “They use an individual risk premium modification factor to compare risk and rates. This nuanced approach ensures we set fair premiums and properly protect our policyholders and their artisan construction businesses.”

Loss History
Past loss history is another critical consideration when determining rates. According to Woods, “Past performance often indicates future risk. If you’ve had a consistent loss history, that pattern is statistically likely to continue. If you don’t have a loss history, you’re less likely to have a loss history in the future.” He explains that these adjustments are based on trends and patterns rather than penalizing past incidents.

For example, if a contractor has taken steps to mitigate recurring issues—such as implementing better safety training—underwriters also consider those efforts when determining premium.

Safety Measures
Contractors can positively impact their rates by implementing safety measures and training programs. If an artisan construction company has experienced losses in the past but has taken concrete steps to prevent similar incidents, underwriters will consider these improvements.

Meet BOP: Comprehensive Small Business Coverage at a Fair Price

Central’s Business Owner’s Policy (BOP) bundles essential insurance coverages in one simple, cost-effective package designed to meet small business owner needs. To qualify for BOP, a contractor’s subcontracted work cannot exceed 10% of total work, and you must maintain a payroll under $1 million.

BOP coverages include:

Property Coverage: Protects your business property, including your building, equipment, inventory, and even outdoor signs, from unexpected events like fire, theft, or storms.

Liability Coverage: Safeguard your business if someone is injured on your property or if you’re held responsible for causing damage to someone else’s property.

Contractor’s Installation: Provides all-risk coverage for personal property that an insured contractor installs, fabricates, or erects. This coverage applies to owned property and the property of others.

Contractor’s Tools and Equipment: Covers mobile machinery, equipment, and tools contractors use in their construction operations. It protects equipment and tools at a jobsite or the insured’s premises, including in transit.

The BOP includes additional coverages like Equipment Breakdown, Cyber Suite, and Employment Practices Liability to provide small business owners with even greater protection against unforeseen losses. Combining these essential coverages allows you to focus on running your business, knowing you’re getting comprehensive coverage at a fair price.

The Central Difference

“Central’s underwriting expertise and strong agency partnerships play an important role in our ability to provide artisan contractors with the best protection,” Laser says. “Our agency partners bring a lot of expertise to the table. They understand the specialized needs of artisan contractors and work with them to find the right coverage for their business.”

In addition, Central’s loss control experts are a valuable resource for artisan contractors. From expert advice to on-site evaluations to safety training resources, this team can work with you to better protect your people, lower risks, and help you save money by avoiding claims.

Ready to explore coverages for your artisan construction business? Find an agent to get started.

Read More:

How a Loss Control Specialist Can Protect Your Small Business: A deep dive into the role of a loss control specialist, how they can assist in addressing potential hazards unique to your industry, and the long-term benefits of working with one.

Loss Control Tips for Construction Companies: Strategies for safeguarding your property, assets, and employees.

Insurance for Artisan Contractors: Tips for understanding the essential insurance policies you need to protect your artisan construction business.

What is Contractor Tools and Equipment Coverage? Learn how Tools and Equipment coverage protects the tools critical to your business.