There are 3,787,470 construction firms in the US. This business offers promising returns, with profits averaging $100,000 to $ 1 million annually.
If you are considering venturing into this money-making business, don't let the high profits make you overlook the unforeseen risks you might encounter. It would be best to acknowledge that unexpected challenges might be inevitable whether you are a startup or an experienced contractor.
You must obtain New Jersey contractor insurance to safeguard your firm's financial stability. This article discusses the fundamental insurance policies you should prioritize, their coverage limits, add-ons, and the top insurance companies and brokers you can buy from.
Here are some of the fundamental NJ contractor insurance requirements:
General liability insurance–You require general liability insurance with limits of $500,000 -$1,000,000 per occurrence and aggregate limit
Workers' compensation insurance–If you have employees in New Jersey, you must hold workers' compensation insurance. The number of employees and type of work determine the limit
Commercial auto insurance–Coverage limitations depend on the contractor's vehicle size, type of work, and other considerations. The coverage limit ranges from $500,000 to $1 million per accident
General and building contractors–Property damage coverage of $50,000 and public liability coverage of $300,000 are required
Other contractors–You must carry a $100,000 public liability insurance policy and $25,000 property damage coverage
Bonding–In NJ, you must obtain a contractor license bond. The contractor's bond might range from $10,000 to $300,000, depending on the work
| CoverWallet | NEXT (Best) | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $2,000,000 | $1,000,000/$2,000,000 |
| Aggregate limit | $2,000,000 | $2,000,000 | $1,000,000/$2,000,000 | $2,000,000 | $1,000,000/$2,000,000 |
| Products and completed operations aggregate limit | $2,000,000 | $1,000,000 | $2,000,000 | $1,000,000 | $1,000,000 |
| Advertising injury coverage aggregate limit | $1,000,000 | $1,000,000 | $2,000,000 | $1,000,000 | $1,000,000 |
| Tenant’s legal liability coverage limit | $300,000/$1,000,000 | $300,000 | $100,000 | $100,000 | $1,000,000 |
| Waiver of subrogation included? | Yes | No | Included | Can be included | No |
| Hired/non-owned auto liability coverage included? | Yes | No | No | Can be included | Can be included |
| Equipment breakdown floater included? | No | Yes | Yes | Can be included | Can be included |
| Can you get a certificate of insurance online? | Yes | Yes | Yes | Yes | Yes |
| Name additional insureds? | Yes | Yes | Yes | Yes | Yes |
| Deductible | $0 | $0 | $0 | $0 | $0 |
Contractor general liability insurance in New Jersey cushions your firm from claims that may occur during a renovation or building operation. Ensure you purchase this general contractor insurance NJ for adequate protection from advertising injuries, bodily injuries, and medical payments.
If a competitor firm accuses you of using their images or logo without permission
One of your employees makes defamatory remarks about another business
A client is injured while visiting the construction site
You damage a customer’s car while constructing a building
Customer property coverage–This add-on reimburses the customer if his or her property gets damaged while under your care, custody, and control
Professional liability insurance–This add-on is crucial. If you offer consultation or design services, professional liability insurance will cover claims that arise from negligence or professional mistakes
When an incident occurs in your business, such as a customer sustaining injuries, your insurance will pay a certain amount to cover the damages. The limit can be $1 million to $2 million for each occurrence, while you get an aggregate limit of up to $5 million or more.
| CoverWallet | NEXT | Thimble (Best) | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $1,000,000 |
| Aggregate limit | $2,000,000 | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $2,000,000 |
| Name additional insureds? | Yes | Yes | Yes | Yes | Yes |
| Waiver of subrogation included? | Yes | No | Yes | Can be included | No |
| HIPAA coverage included? | No | No | No | No | No |
| Sexual misconduct coverage included? | No | No | No | No | Can be included |
| License defense coverage included? | No | No | No | No | Can be included |
| Deductible | $500 | $500 | $500 | $50/$10,000 | $500 |
Some clients can be unsatisfied with your work and even claim you caused losses. Professional indemnity insurance shelters your company from claims of omissions, errors, or negligence. When a client sues you over a mistake you made, this policy will cover legal defense and settlement costs.
You make a slight mistake when designing or renovating a building, leading to your client incurring expensive repairing or rebuilding costs
Your construction promises a specific service, but you fail to deliver. A client might believe your actions impacted their business
Your work fails to meet the industry standards and leads to a customer suffering financial damage
Third-party liability insurance–This add-on helps to extend the coverage of your standard policy and covers claims made by third parties who may not be direct clients
Run-off insurance–If you are considering retiring or closing your construction business, run-off insurance will cover all claims made after you stop operating
The estimated coverage limit after being accused of professional errors or negligence is $1 million to $5 million for a single claim. But you can get higher limits if you are involved in complex projects.
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| CoverWallet | NEXT (Best) | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Building coverage limit (minimum) | $50,000 | $260,000 | $25,000/$500,000 | $25,000 | $60,000 |
| Contents coverage limit (minimum) | $50,000 | $22,000 | $25,000/$500,000 | $25,000 | $60,000 |
| Outdoor signs | Excluded | $2,500 | Excluded | Excluded | Excluded |
| Accounts receivable | Excluded | Excluded | $5,000/10,000 | Included | Excluded |
| Money and securities | Excluded | $2,500 | $1,000 | Included | Excluded |
| Lock and keys | Excluded | $2,500 | Excluded | Excluded | Excluded |
| Business interruption floater | Excluded | Included | Included | Included | Excluded |
| Equipment breakdown floater | Excluded | Included | Excluded | Excluded | Excluded |
| Inland marine insurance floater | Excluded | Excluded | $10,000 | Excluded | Excluded |
| Employee dishonesty floater | Excluded | $5,000 | $2,500 | Included | Excluded |
Commercial property insurance will cover your business premises' rebuilding or repair costs. It can also pay for the costs of replacing your equipment or stock. This policy includes content and buildings insurance. Building insurance will cover your physical structures, such as ceilings, walls, and floors. On the other hand, contents insurance will cover your stock or equipment. Some of the covered perils include:
Burst pipes
Storms
Riots
Theft
Flooding
Falling trees
Flood insurance–Some standard commercial property insurance may not include flood damage. Some areas in New Jersey are vulnerable to flooding, and you should use this add-on to your base policy
Builder's risk insurance–Covers losses due to vandalism, theft, or damage to the construction project
Storms or floods can destroy your buildings; your insurance company will pay $500,000 to $5 million to cover rebuilding and repair costs. But if you have valuable facilities, you will require better coverage.
| CoverWallet | NEXT (Best) | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Building coverage limit (minimum) | $50,000 | $260,000 | $25,000/$500,000 | $25,000 | $60,000 |
| Contents coverage limit (minimum) | $50,000 | $22,000 | $25,000/$500,000 | $25,000 | $60,000 |
| Outdoor signs | Excluded | $2,500 | Excluded | Excluded | Excluded |
| Accounts receivable | Excluded | Excluded | $5,000/10,000 | Included | Excluded |
| Money and securities | Excluded | $2,500 | $1,000 | Included | Excluded |
A business owner’s policy bundles many coverage types into one insurance package. Obtaining one package is cost-effective compared to acquiring the policies separately. These policies are available to small construction businesses with low risk. BOP has property, liability, and business interruption insurance.
If your office is damaged by fire or natural disasters, this coverage will compensate you for all the damages.
For bodily injury, the coverage will reimburse the medical costs
For claims of libel or slander, the policy will pay for defense costs or compensation fees
Cyber liability insurance–This add-on will shelter your business from cyber risks. It will cover costs related to credit monitoring, data breach response or legal liabilities from adverse cyber incidents.
Employment practices liability insurance–Protects your company from allegations of harassment, wrongful termination, and discrimination
You will be compensated $1 million to $2 million for each occurrence in the liability coverage and $100,000 to $5 million for the property coverage.
| NEXT | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|
| Aggregate limit | $3,000/$10,000 | $2,500/$5,000 | $15,000/$25,000 | $5,000-$10,000 |
| Covers hired and borrowed equipment? | $3,000/$10,000 | $2,500/$5,000 | No | Yes |
| Miscellaneous equipment also covered? | $5,000/$10,000 | No | Yes | Yes |
| Offered as an endorsement to general liability insurance? | Yes | Yes | Yes | Yes |
| Deductible | $500 | $500 | $0 | $0 |
Tools and equipment insurance offers coverage for your small hand tools and equipment. This coverage may also extend to your rental equipment. Your insurance can provide replacement cost coverage or actual cash value coverage. Replacement cost is the value of your tools and equipment and determines how much your insurer will compensate after a covered event occurs. Conversely, actual cash value pays for your stolen or damaged items at depreciating value.
Your tools and equipment are damaged by fire
Your items are stolen
Your employees accidentally damage your tools and equipment
Employee theft coverage–This add-on offers coverage in case your employees commit fraudulent activities, such as stealing your tools and equipment
Inland marine coverage–Extends the coverage of your tools and equipment insurance to include items transported to off-site locations
If your tools and equipment are destroyed or stolen, an insurer can pay you an aggregate limit of $100,000 to $5 million.
You require commercial auto insurance if your construction business owns or leases vehicles. This help compensates for the legal fees, repairs, or medical costs in case an accident that involves your automobile occurs. The policy covers a variety of vehicles, such as vans, tracks, or cars, for your contracting business.
Liability coverage–Pays for property damage and bodily injury liabilities after an accident
Medical payment coverage–Pays for the needed medical costs for all the covered personnel
Collision coverage–Will pay for the repair costs if your vehicle is damaged after a collision with an object or car
Comprehensive coverage–Will pay for the damage to your insured vehicle; damage can be due to vandalism or theft
Uninsured/underinsured motorist coverage–This policy settles any damages when your driver is involved in an accident with another driver who doesn't have adequate liability insurance
Hired and non-owned auto coverage–This policy will extend your commercial auto insurance to accommodate borrowed or rented vehicles
Umbrella insurance–This add-on will extend the limits of your commercial auto insurance. It will safeguard your business if it faces a large liability claim
An insurer will evaluate whether the accident has caused property damage, bodily injury, or damage to your vehicle. Depending on the extent of the accident, you can get coverage of $50,000 to $500,000.
Excess liability is tailored for some significant incidents which may exhaust your primary insurance policy. You can include it as a safety net; it will step in when your regular policy cannot adequately cover all damages suffered. With this policy, you are 100% guaranteed that your business will still run even after calamities hit your construction business.
Covers severe property damage that may require hefty rebuilding or repairing costs
In severe bodily injury, the medical bills can escalate and exceed your policy's limit
The coverage limit depends on your risk exposure and the specific assets you must cover. But you will get paid an average of $2 million to $10 million.
The construction business poses so many hazards to the workers. An employee may fall from a height and sustain severe injuries. In other instances, the materials you use for construction can lead to infections. Having this home improvement contractor insurance NJ is intrinsic to the safety of your employees.
An employee falls ill due to exposure to harmful substances at work
An employee suffers from chronic pain due to lifting heavy materials
An employee falls from a height and sustains a hip injury
Worldwide coverage–This ensures you can adequately cover employees working for your company beyond the state's border
Employer's liability insurance–This add-on covers negligence lawsuits filed by employees who sustained a work-related injury or disease
Occupational accident insurance–Independent contractors and self-employed individuals can get occupational accident insurance instead of workers' compensation. It protects contractors who are not protected by workers' compensation
The payment you get from your insurance company can be used to pay for hospital bills, lost wages, funeral costs, or death benefits. For the lost income, your employee will calculate it according to the weekly wage of the employee.
| Cost per Month | Cost per Year | Deductible | |
|---|---|---|---|
| General liability insurance | $32 | $384 | $0-$500 |
| Professional liability insurance | $46 | $552 | $1,000-$2,000 |
| Commercial property insurance | $55 | $660 | $1,000-$2,000 |
| Business owner's policy | $74 | $888 | $1,500 |
| Tools and equipment insurance | $38 | $456 | $500-$1,000 |
| Commercial auto insurance | $57 | $684 | $500-$1,000 |
| Workers compensation insurance | $65 | $780 | $2,500-$5,000 |
| Excess liability insurance | $34 | $408 | $500-$1,000 |
The average NJ contractor insurance cost is $32 per month or $384 per year for a $1 million general liability policy. Factors that affect premiums are claims history, business history, policy limits, deductibles, and number of employees. Here’s a table showing the cost of a $1 million general liability policy from the best companies:
| Cost per Month | Cost per Year | Best for | |
|---|---|---|---|
| NEXT | $15 | $180 | Best overall; Fastest general liability insurance for contractors |
| CoverWallet | $17 | $204 | Comparing contractor insurance quotes online |
| The Hartford | $20 | $240 | Workers' compensation insurance for contractors in New Jersey |
| Tivly | $22 | $264 | Comparing contractor insurance quotes over the phone |
| Thimble | $26 | $312 | Contractors looking for on-demand coverage |
| Hiscox | $28 | $336 | Contractors who operate internationally and looking for global coverage |
Get a further idea of general contractor insurance cost NJ by comparing quotes. Click the “Get Quotes” button on this page to start.
Get all the best quotes from leading providers in a click of a button!
Here are the companies to consider working with. Read some of the reviews below to know their pros, cons, and average rate for a $1 million general liability policy.
Outstanding customer service team who guide you in insurance policy acquisition
Excellent rates suitable even for startup contractors
Offers online proof of insurance within minutes
For bundled-up policies, you get a 10% discount
Fastest general liability insurance
Best overall
Couldn't find any
NEXT is one of the best choices for contractors seeking comprehensive coverage in New Jersey. They allow you to acquire insurance coverage online, access your insurance license, and manage your policies easily. You can get assistance from their agents when making claims.
Best for: Best overall; Fastest general liability insurance for contractors
Average cost: $15 per month
Our rating: 10/10
They offer an online platform where you have access to multiple insurance providers
You can find out which insurer offers competitive rates through their comparison tool
You can discuss the needs and operations of your business with them, and they will direct you to a provider who best meets your needs
An insurance broker who does not underwrite their policies
CoverWallet offers adjusted insurance solutions to contractors despite the size of your business. They walk you through the entire process of purchasing a claim and ensure you get the proper coverage. They have also invested in an online comparison tool that allows you to view the prices of different providers.
Best for: Comparing contractor insurance quotes online
Average cost: $17 per month
Our rating: 10/10
They have a good reputation for handling claims faster
You can purchase comprehensive insurance policies
Offers excellent benefits on their worker's compensation insurance
You can easily acquire contractors insurance online
Primarily targets AARP members and may not adequately address the needs of non-members.
The Hartford has offered a safety net for small businesses for over a century. It is known for having the best workers' compensation policies and benefits. They also provide businesses tips to mitigate occupation-related accidents. For businesses with high-risk profiles, this company allows purchasing of specialized policies.
Best for: Workers' compensation insurance for contractors in New Jersey
Average cost: $20 per month
Our rating: 10/10
Has partnered with many insurance companies (more than 200)
You can quickly obtain insurance quotes on your phone
Does not consider the risk to your business when issuing coverage
They are cheaper than other providers
You cannot get an insurance quote online
Tivly has managed to stand out by offering competitive prices; they have collaborated with top-rated providers to ensure your business has limitless options. You can purchase multiple policies from this insurance marketplace, such as BOP, workers' compensation insurance, excess liability, general liability, property insurance, and more. Call now to compare quotes over the phone.
Best for: Comparing contractor insurance quotes over the phone
Average cost: $22 per month
Our rating: 9/10
Allows contractors to buy insurance policies when needed
You can include multiple add-ons on the general liability insurance
Their insurance premiums are cost-effective
Their customer service is not available on the phone
Thimble offers on-demand coverage for your construction business. In addition to their short-term policies, you can also get long-term coverage. This company ensures you have versatility and the freedom to customize your limits. You can buy multiple insurance policies, such as general liability, BOP, workers' compensation, professional liability, tools and equipment, and more.
Best for: Contractors looking for on-demand coverage
Average cost: $26 per month
Our rating: 9/10
You can purchase a wide array of policies
They offer coverage in many countries through their worldwide coverage
They are an experienced company that ensures businesses get the appropriate coverage
The process of making claims can be slow
Hiscox is a company known for offering global coverage for companies. You can get a 14-day refund of all your policies. As your construction business expands, you can adjust your limits and add-ons. Some policies you can buy include general liability, workers' compensation insurance, tools and equipment, and excess liability.
Best for: Contractors who operate internationally and looking for global coverage
Average cost: $28 per month
Our rating: 9/10
1 / 5
Use anyone except Employers. Period. They are non-transparent and shameful. After I complained long enough to warrant a call from a supervisor, the supervisor called back from a PRIVATE NUMBER (no caller ID), left a message that they are not reversing their decision (without any communication with me), and failed to leave a phone number for me to call back. She was hiding! They also fact find via email and phone calls, which is terrific for speed and communication. However, after setting a precedence of email or phone calls, they send time sensitive information via email, without any heads up... they are hoping you miss it and forfeit via expiration. Evil policies. Go elsewhere.
1 / 5
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
1 / 5
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
5 / 5
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
5 / 5
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!
Not all those who wander are lost.
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