Snow plowing insurance is expensive because it covers risks such as slip-and-fall claims which can be very costly. General liability insurance, being mandatory, is usually bundled with commercial auto insurance, especially for small businesses that often use independent contractors to cut down on costs. It’s important to know that the IRS may classify contractors as employees if you control their work hours and training.
Coverage and Policies
Before winter arrives, securing coverage is crucial. Obtain coverage early to ensure you’re protected throughout the season. If you have a plowing service, it can cost between $30-$50 per visit, while shoveling could be $25-$75 per hour. Remember that with employees, workers’ compensation insurance is necessary, and you may need to provide additional benefits.
Commercial vehicle insurance is typically paid only when the plow is in operation. However, an agent might not cover your plow under a commercial policy. Construction businesses usually pay around $74 per month for liability insurance. When bundled with snow plowing liability, the monthly cost increases to $112. This type of insurance covers legal fees associated with claims of negligence. If you’re looking for additional coverage, consider umbrella insurance, which boosts your policy limits.
Cost Drivers and Legal Aspects
Slip-and-fall lawsuits are a major contributor to high insurance premiums. Home and business owners may transfer responsibility to contractors in the event of accidents. Policies for snow plow coverage range from $400-$1,000 annually, with commercial auto around $900 per year. A business owners policy is approximately $400 per year.
Adequate insurance shields businesses from lawsuits and covers damages to vehicles, equipment, and other liabilities. In 2020, a law was introduced aimed at protecting contractors and independent businesses from such risks, but until it effectively reduces incidents or is widely adopted, insurance premiums are likely to remain high.
In 2021, Massachusetts provided state assistance for snow removal efforts to mitigate costs. If you run a snow removal business, you will need a policy encompassing residential and commercial services, subcontractors, and landscape companies that offer winter services.
Insights for Snow Plow Business Success
Considering starting a snow plow business? It can be profitable with the right strategy and understanding of the local market. Startup costs for equipment may range from $6,000 to $13,000. When planning, take into account that residential contracts bring in volume, while commercial contracts may offer higher payment per job.
Businesses providing snow removal services essentially need appropriate insurance, which includes general liability among others. Proper precautions can prevent potential damage from plowing, allowing you to operate successfully for years.
If you’ll be plowing snow this winter, be sure to protect your business with the necessary policies. Hiring someone might seem expensive, but it could save you in the long run if you compare it to potential insurance claims for accidents.
For comprehensive coverage, policies like Snow Plow Insurance Plus bundle all the necessary coverage into one package. Reach out to an insurance agent to discuss the best option and protect your business investment – a smart decision for any enterprise.
Remember that proper insurance is vital for your business, and having the right kind can make all the difference when the winter season hits.