How Commercial Auto Insurance Protects From 3 Common Construction Claims

How Commercial Auto Insurance Protects From 3 Common Construction Claims

Driving to and from worksites exposes small construction and contracting businesses to a high level of risk. A collision could lead to another motorist getting injured, or expensive repairs for your construction truck or van.

On top of this, fatalities due to substance abuse in the construction sector is above other industry averages. While employee drug testing is important to a successful construction company, around 15% of all construction workers in the United States have a substance abuse disorder compared to 8.6% of the general population of adults, according to data from the National Survey on Drug Use conducted by the Substance Abuse and Mental Health Administration.

Specializing in commercial auto insurance, CNS Insurance knows how to keep you and your business safe and secure and protect construction fleets from common claims.

3 common causes of construction insurance claims

The three most common causes of construction insurance claims come from fire/explosions, natural catastrophes, and equipment theft.

Fire/Explosion Claims: According to Allianz Risk Consulting, over the last five years fire/explosion has been the biggest cause of loss for the construction sector with over a quarter (27%) of losses by value.

While fire is a constant challenge for construction companies because of the nature of their work, there are three risk mitigation practices they can use to reduce their exposure:

  • preventative measures before the blaze,
  • methods to extinguish the fire once it has started, and
  • contingency planning

Commercial auto insurance can help cover the cost of property damage and other expenses that arise from an accident.

Natural catastrophe: Last year alone sawfierce snow and ice storms, widespread wildfires, and massive rainstorms and is why natural catastrophes are the second largest cause of loss by number, accounting for 1 in 10 claims in the industry.

Commercial auto insurance can help pay for vehicle damage caused by weather or vandalism.

Equipment theft: In 2014, there were 11,625 heavy-equipment thefts reported to the police and a preliminary analysis by the National Insurance Crime Bureau shows auto theft took a dramatic leap upward in 2020 compared to 2019, reversing two years of auto theft declines.

While construction companies can avoid stolen equipment by securing equipment and tools left at job sites overnight, increasing lighting and security cameras, or installing telematic devices in equipment, commercial auto insurance will get you back on your feet if all of your other efforts fail to deter thieves.

CNS Insurance & Progressive Smart Haul Program

If you are not insured, it is very possible that you will be court-ordered to pay a settlement after an accident, which would fall on you completely without having commercial coverage.

As we all know, medical bills are extremely expensive and add up. If an employee operating a company vehicle has an accident and is injured, your policy will cover medical care for the employee and any passengers.

Commercial auto insurance can help cover the cost of lawsuits, property damage, medical bills, and other expenses that arise from an accident. It also pays for vehicle damage caused by weather or vandalism, along with vehicle theft.

Basic Construction and Excavating Insurance Coverage

There are two main basic insurance coverages that construction companies need.

General Liability Insurance: This common construction liability coverage protects your business if it is responsible for events like property damage, bodily injury or defective work.

Commercial Auto Insurance: Protects vehicles used in your business including those that transport your tools and equipment. Adding physical damage coverage to your policy gives you the choice to cover permanently attached equipment such as bolted tool boxes or ladder racks.

As a commercial truck insurance provider for construction and contracting businesses, we have a solution to assist you and will tailor your commercial auto insurance policy to meet the needs of your construction or contracting business.

Commercial auto insurance may be required if you:

  • Own company vehicles that must be covered by commercial auto insurance.
  • Operate a construction or contracting vehicle
  • Transport tools and equipment
  • Send employees on errands during work hours

While commercial auto insurance is crucial for small businesses that depend on a car, van, or truck, it does not cover risks beyond those related to your vehicle. Owners of construction and contracting businesses should also consider:

  • Workers’ compensation insurance: Required in almost every state for construction and contracting businesses that have employees, workers’ comp can cover medical fees for work-related injuries.
  • Contractor’s tools and equipment insurance: This policy helps pay for repair or replacement of a contractor’s equipment and tools if they are lost, stolen, or damaged.
  • Professional liability insurance: This policy covers professional mistakes and oversights, such as a contractor missing a deadline for a project.
  • Builder’s risk insurance: Builder’s risk insurance can pay for damage done to a structure still under construction, such as fire or vandalism at a construction site.

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