Why You Need Insurance To Protect Your Painting Business

Painting insurance is a critical safeguard for businesses operating in the painting sector, offering crucial financial security against liability and property damage claims. Essential components of these policies often include coverage for general liability, commercial property, professional liability and workers' compensation. When combined, a painters insurance policy provides a wide range of protection for painting businesses.

Discover the various types of insurance, accompanied by insights on how to seek out the most fitting painters insurance.

Key Takeaways Commercial auto and workers' compensation are usually required for painting businesses with work vehicles and employees. If your business is the cause of a customer getting injured, you can expect to pay $30,000 on average for a third-party injury claim. General liability insurance costs $365 to $1,700 per year on average, while commercial auto insurance ranges from $750 to $2,500 per year. The cost of painters coverage depends on business size, coverage type and amount, employee number, location, claims history and chosen deductible, with larger, riskier businesses generally paying higher premiums.

What Is Painters Insurance?

Painters insurance is a type of commercial insurance designed to protect painting businesses from potential out-of-pocket losses. It encompasses several policies that cover various liabilities such as injuries, property damage and professional errors. Additionally, painters insurance can also protect against expenses related to lost or damaged business property.

Are Painters Required To Have Insurance?

Some states may have certain business insurance requirements for painters, whether they work as contractors or subcontractors. However, workers' compensation and commercial auto are the only two mandated insurances for painters. Even still, there are some caveats to this.

Namely, workers' compensation insurance is required for businesses with a minimum number of employees and commercial auto insurance is required in most states if you have a company-owned vehicle.

That being said, other types of liability insurance for painters should also be purchased. Otherwise, any damage you or an employee causes will be paid out of your pocket, potentially leading to a dead business.

What Types of Business Insurance Do Painters Need?

We've provided several types of insurance that cater to different aspects of a painting business.

General Liability Insurance

General liability protects against third-party claims for bodily injury, property damage and advertising injury. For instance, if a client trips over a paint can in your workspace, general liability insurance can cover the medical bills for any injuries they sustained plus legal fees if they sue you. With customer injury claims averaging $30,000, you can't afford to forgo general liability coverage.^[1]

Commercial Property Insurance

Commercial property insurance covers business-owned property, such as your workspace and equipment, against risks like theft, fire and vandalism. If your workshop or warehouse is damaged by a fire, your commercial property insurance will cover repairs to your place of business and any tools and equipment that may have been destroyed. This coverage only applies to business property located at the insured business location.

Business Interruption Insurance

Business interruption insurance covers the loss of income resulting from a disaster that disrupts the operation of your business. For instance, say the fire that was mentioned above destroys your painting workshop and you cannot resume normal business operations. This insurance can cover your lost revenue, operating expenses and even the cost of a temporary location until you can get back on your feet.

Professional Liability Insurance

Also known as errors and omissions insurance, professional liability insurance protects against claims of inadequate work or negligent actions. For instance, if a client sues your business claiming your paint job ruined the exterior of their home or if they were dissatisfied with the quality of your workmanship, this policy can cover your legal expenses.

Commercial Auto Insurance

In nearly every state, you need insurance to legally drive and if you have a company van for transporting materials to project sites, you will need commercial auto insurance. Similar to a personal auto policy, this coverage provides liability and physical damage protection for your business vehicles. Commercial auto claims average at $45,000 in cost per accident, making commercial auto coverage one of the most necessary forms of insurance you can purchase.^[1]

Workers' Compensation Insurance

Workers’ compensation insurance provides wage replacement and medical benefits to employees who get sick or injured on the job and is mandatory in most states if you have employees. For example, if an employee is injured after falling off a ladder while painting, workers’ compensation insurance should pay for their medical bills, as well as a portion of their lost wages.

Additional Coverages To Consider

There are other coverage options you can include with your business insurance plan to help cover your financial bases, including:

• Tools and equipment insurance: Protects your painting tools and equipment against damage caused by work-related accidents, theft and loss occurring at a job site or your business office. Includes coverage for borrowed tools as well.
• Commercial umbrella insurance: Extends the limits of your liability coverage past their initial amount once they've been expended. For example, it would cover the difference if you have a claim totaling $700,000 but your base liability policy only covers up to $500,000.
• Business owners policy: Bundles general liability, property insurance and business interruption at a discounted rate, making it cost-effective for small painting businesses.

How Much Does Painters Insurance Cost?

While the exact costs of insurance for painter businesses will vary due to several factors, a small operation might expect to pay around $365 to $1,700 per year for general liability insurance.[2] Commercial auto insurance might range from $750 to $2,500 per year, depending on the vehicle and driving history. Workers' compensation insurance is typically calculated by multiplying a rate (which can vary based on industry) by each $100 of payroll and can generally range from $375 to $1,400 per employee.^[2][3]

How To Get Painters Insurance for Your Small Business

Securing painting business insurance for your small business starts with understanding your business’s unique needs, which depend on various factors, such as your business size, the number of employees, the nature of your work and your business location. Once you've identified your needs, it's beneficial to consult with a professional, like an insurance agent or broker. Their expertise can guide you toward the most suitable policies for your situation.

After gaining a clear understanding of your insurance needs, it's crucial to gather and compare quotes from different providers. The easiest way to do this is by using SmartFinancial. You can sometimes get a quote in a matter of minutes. It's important to remember that the cheapest option might not always be the best. The ideal policy offers comprehensive coverage at a reasonable price.

Once you're ready to make a choice, ensure you thoroughly review the terms, conditions, coverage and exclusions of each policy. Understanding what you're signing up for helps avoid unwelcome surprises in the future.

Upon purchasing the insurance, the process doesn't stop. Be sure to regularly review your policy to ensure it keeps up with your evolving business needs. Additionally, maintaining updated records and meeting all the legal and contractual insurance requirements is crucial, especially if you need to make a claim or prove your coverage to a client or regulatory body.

Remember, securing insurance for painting contractors and subcontractors is not just about safeguarding against potential risks but also about building a trustworthy image for your business. Adequate insurance coverage often signals to clients and potential partners that they're dealing with a reliable, professional operation.