Insurance for Restoration Contractors: Are You Really Covered?
Most restoration contractors have significant gaps in their insurance coverage. If your restoration company is operating on a general liability policy, it is time to reconsider insurance for restoration contractors.
General Liability Might Not Be Enough for Restoration Service Providers
If all you are protecting your business with is general liability insurance, it is time to look at the fine print on your policy. While every policy is different, many have professional exclusions. Some of these exclusions can include, but are not limited to:
- Supervising or inspecting
- Preparing for, approving or failing any work plans, reports, surveys, etc.
- Evaluations or consultations
In addition, specialty restoration services such as water damage cleanup or mold abatement services require more specialized insurance plans. Insurance companies have added exclusions to policies for mold. Not only are mold remediation services not always covered, but any service provider in the water restoration and mold remediation industry could be denied coverage.
This is a serious change. Because, essentially a restoration contractor could be liable for any bodily harm, disease or damages done from exposure to fungus, mold or bacteria within the structure they have restored. But, the specific wording for most of these policies leaves the coverage up to the adjuster if any issues arise because of mold or fungi. These gaps are not just specific to the contractor, but also apply to subcontracted work.
How Insurance for Restoration Contractors Can Fill in the Gaps
Insurance designed specifically for restoration contractors goes beyond general liability. For complete coverage, restoration specialists — whether dealing with mold or not — are required to carry Contractors’ Pollution Liability or CPL insurance. Because some customers’ homeowner insurance policies require the homeowner only hire a firm with a CPL certificate, this coverage is not just essential for protecting your business, but will also help you get business. CPL is not a new insurance policy; instead, it provides contractors with the coverage they need to handle any Universal Mold Exclusions in their own policies as well as that of the homeowner.
CPL insurance was originally designed in 1986 for contractors dealing with hazardous waste. When the universal mold exclusions were released in 2003, it became a go-to policy option for restoration contractors as well. Without CPL coverage, restoration contractors might have gaps in their policies for drying, roofing, window replacement, siding, construction and other services associated with mold abatement and remediation.
Most CPL policies include property damage, bodily injury, cleanup costs and any defense due to a dispersal of pollutants such as mold. It is important for restoration contractors to meet with an insurance professional, find out the specific coverage under their current general liability policy and ask how a CPL policy can help.
As a restoration contractor, adding CPL coverage to your insurance package could help protect your business during the restoration process. With the number of natural disasters on the rise and the demand for restoration contractors steadily increasing in the United States, your business cannot afford to be without the right policies.
Call The Nowell Agency Inc. at 601.992.4444 for more information or request a quote for restoration contractors’ insurance online.