Best Business Insurance for Contractors in 2024 (Top 10 Companies)
The best business insurance for contractors is available through State Farm, USAA, and Progressive with competitive rates and discounts up to 17%. These top providers excel by tailoring policies to contractor needs, ensuring comprehensive coverage, superior customer service, and exceptional value.
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Michelle Robbins
Licensed Insurance Agent
Michelle Robbins has been a licensed insurance agent for over 13 years. Her career began in the real estate industry, supporting local realtors with title Insurance. After several years, Michelle shifted to real estate home warranty insurance, where she managed a territory of over 100 miles of real estate professionals. Later, Agent Robbins obtained more licensing and experience serving families a...
Licensed Insurance Agent
UPDATED: Apr 25, 2024
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Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.
UPDATED: Apr 25, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance company and cannot guarantee quotes from any single insurance company.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
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The top picks for the best business insurance for contractors are State Farm, USAA, and Progressive, known for their competitive rates and tailored coverage options.
| Company | Rank | Delivery Driver Discount | Multi-Vehicle Discount | Best For | Jump to Pros/Cons |
|---|---|---|---|---|---|
 | #1 | 17% | 30% | Many Discounts | State Farm |
 | #2 | 10% | 20% | Military Savings | USAA |
 | #3 | 5% | 30% | Online Convenience | Progressive |
 | #4 | 25% | 35% | Add-on Coverages | Allstate |
 | #5 | 20% | 20% | Usage Discount | Nationwide |
 | #6 | 15% | 15% | Policy Options | Chubb |
 | #7 | 13% | 10% | Accident Forgiveness | Travelers |
 | #8 | 10% | 15% | Local Agents | Farmers |
 | #9 | 5% | 20% | Deductible Reduction | The Hartford |
 | #10 | 30% | 30% | Customizable Polices | Liberty Mutual |
#1 – State Farm: Top Overall Pick
Pros
- Many Discounts: State Farm offers a wide range of discounts, providing potential cost savings for contractors. With a maximum multi-policy discount of up to 17% and a maximum low-mileage discount of up to 30%, contractors can benefit from various cost-saving opportunities.
- Coverage Options: State Farm provides diverse coverage options, allowing contractors to tailor their insurance plans to meet their specific needs. This flexibility can be crucial for contractors with varying business requirements.
- Reputation: State Farm is well-known for its strong financial stability and customer service. Contractors may find assurance in choosing a reputable company that has a history of reliability and customer satisfaction.
Cons
- Potentially Higher Rates: While State Farm offers many discounts, the actual rates may still be relatively higher for some contractors compared to other companies on the list. Check out our State Farm insurance review & ratings for more details.
- Eligibility Restrictions: State Farm’s eligibility criteria for certain discounts may limit access for some contractors, potentially excluding certain businesses from enjoying the full range of benefits.
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#2 – USAA: Best for Military Excellence
Pros
- Military Savings: USAA is known for providing exclusive benefits to military members and their families. Contractors with military affiliations can take advantage of up to 10% multi-policy and up to 20% low-mileage discounts.
- Customer Service: USAA is renowned for its exceptional customer service. Contractors may appreciate the personalized attention and support, especially when dealing with the specific insurance needs of their businesses.
- Financial Stability: USAA has a strong financial standing, which can instill confidence in contractors regarding the company’s ability to meet its financial obligations, especially in the event of a claim.
Cons
- Limited Eligibility: USAA’s membership is restricted to military members and their families. Contractors who do not meet this criterion are not eligible to benefit from USAA’s offerings. Explore our USAA insurance review & ratings for more insights.
- Limited Coverage Options: While USAA offers competitive rates for its target demographic, it may have fewer coverage options compared to some other providers, potentially limiting the choices available to contractors.
#3 – Progressive: Best for Online Convenience and Discounts
Pros
- Online Convenience: Progressive excels in providing an online platform for obtaining quotes and managing policies. This convenience can be a significant advantage for busy contractors who prefer managing their insurance needs digitally.
- Usage Discount: Progressive offers a usage discount of up to 20%, making it appealing for contractors who may have vehicles with lower annual mileage. This can result in cost savings for businesses with limited vehicle usage.
- Name Recognition: Progressive is a well-known brand in the insurance industry, and contractors may appreciate choosing a company with a strong market presence and a history of innovation. Please review our Progressive insurance review & ratings for additional information.
Cons
- Limited Multi-Policy Discounts: Progressive’s maximum multi-policy discount of up to 5% may be less competitive compared to other companies on the list, potentially offering fewer savings opportunities for contractors bundling multiple policies.
- Coverage Customization: While Progressive offers customizable policies, the level of customization may not be as extensive as some other providers, limiting the ability of contractors to tailor coverage precisely to their needs.
#4 – Allstate: Best for Versatile Coverage
Pros
- Add-On Coverages: Allstate stands out for offering a variety of add-on coverages, allowing contractors to tailor their policies extensively and ensuring comprehensive protection.
- Discount Options: With a maximum multi-policy discount of up to 25% and a substantial low-mileage discount of up to 35%, Allstate provides contractors with significant opportunities for savings.
- Reputation: Allstate’s solid reputation in the insurance industry contributes to its appeal, instilling confidence in contractors seeking reliable and reputable coverage.
Cons
- Potentially Higher Rates: Despite discounts, Allstate’s rates may still be relatively higher for some contractors compared to competitors. Explore our Allstate insurance review & ratings for additional insights.
- Eligibility Conditions: Eligibility conditions for certain discounts might limit access for specific contractors, potentially affecting the overall affordability.
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#5 – Nationwide: Bets for Usage-Based Discounts
Pros
- Usage Discount: Nationwide offers up to 20% in usage-based discounts, making it an attractive option for contractors with lower annual mileage requirements. Please read our National insurance review & ratings for more information.
- Multi-Policy Savings: With a maximum multi-policy discount of up to 20%, Nationwide provides contractors with significant opportunities for bundling and saving.
- Diverse Coverage Options: Nationwide’s range of coverage options allows contractors to customize their insurance plans, ensuring they get the protection that aligns with their business needs.
Cons
- Limited Multi-Policy Discounts: While competitive, Nationwide’s maximum multi-policy discount may be lower compared to some other providers, potentially affecting overall savings.
- Online Presence: Nationwide’s online tools and interface may not be as advanced or user-friendly as some other competitors, impacting the overall customer experience for tech-savvy contractors.
#6 – Chubb: Best for Comprehensive Policy Options
Pros
- Policy Options: Chubb excels in providing extensive policy options, allowing contractors to tailor coverage to their specific needs, ensuring a comprehensive and precise insurance plan.
- Coverage Flexibility: With a maximum multi-policy and low-mileage discount of up to 15%, Chubb provides contractors with flexibility in choosing the coverage that suits their unique business requirements.
- High-Value Assets: Chubb is well-regarded for catering to contractors with high-value assets, offering specialized coverage for businesses dealing with valuable equipment and properties.
Cons
- Costs for High-Value Assets: While beneficial for high-value assets, Chubb’s specialized coverage may come at a higher cost compared to standard policies, potentially impacting affordability for some contractors.
- Eligibility Criteria: Eligibility criteria for certain discounts may limit access for specific contractors, potentially excluding certain businesses from maximizing their savings. Check out our Chubb insurance review & ratings for additional details.
#7 – Travelers: Best for Providing Peace of Mind
Pros
- Accident Forgiveness: Travelers offers a notable advantage with accident forgiveness, providing contractors with peace of mind knowing that their rates won’t increase after their first at-fault accident.
- Multi-Policy and Usage Discounts: With a maximum multi-policy discount of up to 13% and a usage-based discount of up to 10%, Travelers provides contractors with opportunities for savings through bundling and responsible driving.
- Diverse Coverage Options: Travelers offers a range of coverage options, allowing contractors to customize their policies according to their specific needs, ensuring comprehensive protection.
Cons
- Eligibility Conditions: Eligibility conditions for accident forgiveness and other discounts may limit access for certain contractors, potentially impacting the overall affordability. For further information, read our Travelers insurance review & ratings.
- Online Presence: Travelers’ online tools and interface may not be as advanced or user-friendly as some other competitors, potentially affecting the overall customer experience for tech-savvy contractors.
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#8 – Farmers: Best for Competitive Discounts
Pros
- Local Agents: Farmers stands out with its focus on local agents, providing contractors with personalized and localized support for their insurance needs. For more information, please refer to our Farmers insurance review & ratings.
- Multi-Policy and Low-Mileage Discounts: Farmers offers a maximum multi-policy discount of up to 10% and a low-mileage discount of up to 15%, providing contractors with opportunities for savings through bundling and reduced vehicle usage.
- Coverage Customization: Farmers allows contractors to customize their coverage, ensuring that the policies align with the unique needs of their businesses.
Cons
- Potentially Limited Online Accessibility: While Farmers emphasizes local agents, the online accessibility and digital tools may not be as extensive as some competitors, potentially impacting the convenience for tech-savvy contractors.
- Eligibility Conditions: Certain eligibility conditions for discounts may limit access for specific contractors, potentially affecting overall affordability.
#9 – The Hartford: Best for Deductible Reduction
Pros
- Deductible Reduction: The Hartford’s focus on deductible reduction, with a maximum discount of up to 20%, offers contractors a practical way to lower their out-of-pocket expenses in the event of a claim.
- Coverage Options: Hartford provides contractors with diverse coverage options, allowing them to tailor their policies to meet the specific needs of their businesses.
- Strong Financial Stability: Hartford’s strong financial standing contributes to its reliability, assuring contractors that the company can meet its financial obligations, especially in the event of a claim.
Cons
- Limited Multi-Policy Discounts: Hartford’s maximum multi-policy discount of up to 5% may be less competitive compared to some other providers, potentially offering fewer opportunities for savings through bundling.
- Eligibility Conditions: Certain eligibility conditions for discounts may limit access for specific contractors, potentially impacting the overall affordability. To find out more, please refer to our Hartford insurance review & ratings.
#10 – Liberty Mutual: Best for Highly Competitive Discounts
Pros
- Customizable Policies: Liberty Mutual excels in offering highly customizable policies, allowing contractors to tailor coverage precisely to their unique business needs.
- Maximum Discounts: With a maximum multi-policy and low-mileage discount of up to 30%, Liberty Mutual provides contractors with unparalleled opportunities for substantial savings.
- Online Convenience: Liberty Mutual offers an advanced online platform for obtaining quotes and managing policies, providing tech-savvy contractors with a convenient and efficient experience.
Cons
- Potentially Higher Rates: Despite substantial discounts, Liberty Mutual’s rates may still be relatively higher for some contractors compared to competitors. To gather additional information, please read our Liberty Mutual review & ratings.
- Eligibility Conditions: Certain eligibility conditions for maximum discounts may limit access for specific contractors, potentially affecting overall affordability.
Monthly Business Insurance Rates for Contractors: Minimum vs. Full Coverage
The monthly business insurance rates for contractors show a notable difference between minimum and full coverage across various insurers. Progressive offers the lowest rate for minimum coverage at $560, while Liberty Mutual provides the most affordable full coverage at $910. For further details, refer to our Progressive car insurance review & ratings.
On the higher end, both minimum and full coverages peak with Nationwide at $600 and $990 respectively. This range highlights the need for contractors to carefully compare insurance rates.
| Insurance Company | Minimum Coverage | Full Coverage |
|---|---|---|
| Allstate | $590 | $970 |
| Chubb | $610 | $930 |
| Farmers | $590 | $980 |
| Liberty Mutual | $600 | $910 |
| Nationwide | $600 | $990 |
| Progressive | $560 | $920 |
| State Farm | $580 | $950 |
| The Hartford | $580 | $960 |
| Travelers | $570 | $940 |
| USAA | $600 | $980 |
Opting for full coverage, generally around the mid-$900s, ensures comprehensive protection, while minimum coverage offers a more budget-friendly option. Such insights are crucial for making informed decisions that align financial considerations with risk management.
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Comprehensive Coverage for Contractors: Essential Business Insurance Protection
Laura Walker Former Licensed Agent
Commercial property insurance safeguards tools, equipment, and buildings from risks like fire, theft, and vandalism. Commercial auto insurance is necessary for contractors using vehicles, covering accidents and damages involving their vehicles.
Seamless Acquisition: Steps to Obtain Business Insurance for Contractors
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Safeguarding Your Assets: Contractor Insurance for Protecting Property
As a contractor, it is essential to safeguard the tools, equipment, and materials crucial to your business operations. Contractor insurance offers robust protection against unforeseen events that can significantly impact your assets. For instance, if your equipment or tools are stolen, this insurance can help mitigate financial losses by covering the cost of their replacement or repair.
Additionally, in the event of an accident involving your work vehicles, contractor insurance can provide financial protection against damages and injuries caused by the incident. Delve into our comprehensive resource titled “Fleet Vehicle Insurance: A Complete Guide” for further insights.
Investing in the right contractor insurance not only protects your physical assets but also ensures peace of mind, allowing you to focus on delivering quality work without the worry of potential financial setbacks from these risks.
Supporting Your Team: Contractor Insurance for Employee Protection
Case Studies: Business Insurance for Contractors in Action
Business insurance is crucial for contractors as it provides a safety net against unforeseen events that can severely impact operations and finances. Here, we explore four case studies that illustrate the protective power of various types of contractor insurance.
- Case Study 1 – Liability Insurance in Action: Michael, a general contractor working on commercial construction, faced a lawsuit when a subcontractor damaged a neighboring business property. Michael’s general liability insurance covered the property damage and business interruption claims, safeguarding his business financially from the lawsuit.
- Case Study 2 – Compensation Insurance at Work: A worker at Sarah’s construction firm fell from scaffolding and sustained severe injuries. Her workers’ compensation insurance covered the worker’s medical expenses and lost wages, preventing financial strain on her business. Explore our article titled “What is Worker’s compensation?” for additional insights.
- Case Study 3 – Property Insurance Recovery: Daniel’s electrical services business was hit by a fire that damaged his office and equipment. His commercial property insurance policy covered the cost of repairs and replacement of the equipment, allowing his business to resume operations with minimal downtime.
- Case Study 4 – Auto Insurance Protection: Olivia’s contracting company relied on a fleet of vehicles, one of which was involved in a rear-end collision. The commercial auto insurance handled the damages to the vehicle and the medical costs of the injured parties, ensuring the company’s operations continued smoothly without out-of-pocket expenses.
These case studies highlight the indispensable role of business insurance in safeguarding contractors from various risks. By investing in the right insurance policies, contractors can ensure that they are prepared for any challenges that may arise, thereby securing their operations and supporting their teams. Contractors should consider their unique needs to choose suitable coverage, ensuring resilience against potential disruptions.
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Summary: Ensuring Security and Stability – The Significance of Business Insurance for Contractors
Frequently Asked Questions
Is business insurance mandatory for contractors?
While business insurance requirements can vary based on local regulations and contractual agreements, having insurance is highly recommended for contractors. It serves as a crucial safeguard against potential liabilities, protecting both the contractor’s business and clients. Check out our comprehensive guide titled “Liability Insurance: A Complete Guide” for further details.
Can I customize my contractor insurance policy with additional coverage options?
Yes, many insurance providers allow contractors to customize their insurance policies by adding additional coverage options tailored to their specific needs. Consulting with an insurance agent or broker can help ensure comprehensive protection based on individual requirements. Don’t overpay for your commercial insurance – enter your ZIP code below to find the cheapest rates possible.
Are subcontractors covered under my contractor insurance policy?
Coverage for subcontractors depends on the specific policy and its terms. Some contractor insurance policies may include coverage for subcontractors, while others may require subcontractors to carry their own insurance. It’s essential to review policy details or consult with the insurance provider for clarity.
Can self-employed contractors obtain business insurance?
Absolutely. Self-employed contractors should obtain business insurance to protect themselves and their businesses from potential risks and liabilities. Even without employees, insurance can provide coverage for property, equipment, and potential legal claims.
What should I do in case of an accident or claim?
What is contractor insurance?
Contractors insurance provides comprehensive protection for businesses against risks associated with construction and contracting work, such as accidents, injuries, theft, and lawsuits.
Who needs contractor insurance?
All professionals in the construction and contracting industry, including general contractors, specialized trades, and even handypersons, should have contractor insurance to protect against potential liabilities.
What does contractor insurance cover?
Coverage typically includes general liability, commercial property, vehicle use, and workers’ compensation. For instance, State Farm offers extensive discounts and a range of policies suited for various contractor needs.
What’s not covered by contractor insurance?
Contractors insurance does not usually cover intentional damage, normal wear and tear, or professional liability issues; for these, separate policies are needed.
How much does contractor insurance cost?
Costs vary based on risk, coverage, and location. Liberty Mutual offers competitive rates with customizable policies, potentially reducing costs significantly. For further details, refer to our query: titled “How does Liberty Mutual handle claims involving hit-and-run accidents?“
Is insurance required by law for general contractors?
Yes, most states require general contractors to carry liability and workers’ compensation insurance. USAA provides tailored policies with military savings that can benefit veterans and active duty service members in this sector.
How does contractor liability insurance protect your business?
It protects against claims of property damage and personal injury caused by your work. Progressive is noted for its convenience in managing policies online, helping streamline the handling of such claims.
Who should get a contractor liability policy?
Any contractor who interacts with clients or their property should have liability insurance. Nationwide, known for usage-based discounts, can be particularly cost-effective for contractors mindful of operational budgets.
Examples of contractor insurance claims?
Common claims include accidental property damage, injuries on job sites, and theft of equipment. Travelers offer accident forgiveness features that can be beneficial in mitigating the repercussions of such incidents.
What are the common exclusions in a contractor insurance policy?
Typical exclusions include professional errors, employee injuries (which are covered by workers’ comp), and intentional misconduct. Chubb offers diverse policy options that can be tailored to cover a wide range of exclusions.
7 ways to save on contractor insurance?
Consider bundling policies, securing multi-vehicle discounts as offered by Allstate, increasing deductibles, reducing coverage on rarely used equipment, maintaining a safe workplace, paying premiums annually, and comparing quotes. For more details, please check out our information on how long does it typically take for Travelers to process a car insurance claim?
5 best contractor liability insurance companies?
Based on the ranking table, top providers include State Farm, USAA, Progressive, Allstate, and Nationwide, each offering unique benefits and discounts.
Example of the cost of contractor insurance?
A typical small to medium contractor might pay between $700 to $1200 annually for general liability insurance. Specific rates can vary; for example, Liberty Mutual offers highly competitive discounts which can reduce premiums.
Where can you get contractor insurance?
Contractors insurance is available through many providers. Companies like State Farm and USAA offer detailed online resources to help contractors choose the right coverage.
Do you need contractor insurance if you are a handyperson?
Yes, even handypersons need contractor insurance to protect against accidents and liability. Companies like Farmers, which offer local agent support, can provide personalized advice on suitable coverage. To access further details, please review our guide titled “How can I pay my Farmers Insurance insurance premium?“
Does a handyperson need contractor insurance?
Absolutely. It’s essential for protecting against potential risks and ensuring compliance with local laws. The Hartford, known for deductible reductions, can make it affordable for handypersons to get covered. Get commercial insurance that doesn’t break your budget by using our free comparison tool below.
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Michelle Robbins
Licensed Insurance Agent
Michelle Robbins has been a licensed insurance agent for over 13 years. Her career began in the real estate industry, supporting local realtors with title Insurance. After several years, Michelle shifted to real estate home warranty insurance, where she managed a territory of over 100 miles of real estate professionals. Later, Agent Robbins obtained more licensing and experience serving families a...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.
