Article Reviewed by a licensed insurance professional: Sam Meenasian (CA dept of insurance license #0F75955).
Welders will often talk about the risks of their job, and they might mention that sparks can lead to things like fire, but they rarely speak about this risk as if it will impact them. Many small business owners actually think that they will be able to properly control risk so that they are never impacted by issues that other businesses suffer from.
Standard liability coverage may actually exclude damage that is caused by heating devices or hot work. This is often added to liability plans via an endorsement, which means that most welding business owners are not even aware that they do not have access to this kind of protection for their company.
This isn’t something that small business owners who offer welding services should ignore. Fires are expensive to recover from, and the process of handling a claim is even more intensive when the fire happens on someone else’s property as a result of work that you are doing for them.
Heating Device Exclusions: How This Impacts Liability Policies
Insurance companies may classify heating device use as a higher-risk work activity. This is because not every industry utilizes heating devices as part of their standard workflows.
Liability policies might exclude open-flame tools, welding torches, heat guns, hot plates or heaters, or soldering tools. This can vary per carrier, but there is a real need for those who offer welding services to make sure that they are protected when they are using these tools as part of their daily workflows.
Welders can often assume that if they have taken out liability coverage, it should specifically protect their business type. This is not always the case, and welding professionals need to be aware of this common pitfall so that they can avoid it.
Why Endorsements Work Well For Welders
Since standard insurance policies for liability don’t always include the use of heating devices, endorsements can tack on this coverage for welding professionals. This endorsement may cover losses related to sparks that have been carried on the wind to start a fire, or heat that has transferred through materials, depending on policy terms.
The endorsement may also potentially handle issues where heat from welding processes damages or warps nearby materials or surfaces, and existing materials that are specifically not ideal to have exposed to heat. Things like solvents, fuel vapors, or even adhesives can be present where welding tasks are being performed, and a welder might not realize this until there is a fire.
Welders Can be Included in Claims They Didn’t See Coming
Welding is a profession that often necessitates work alongside other people doing other services. Materials that are used during construction or remodeling jobs can be less-than-ideal for being exposed to the welding process, but welders might have no idea that they are working in an area that is not entirely prepared for welding efforts.
While the claim that is filed could be for a fire that happened due to vapors in the home during a construction project, if welding was determined to have contributed to the loss, the welder could become part of the claims process since the welding process could have helped cause the fire.
This is just one example, but it is a risk that welders are not always aware of in their field of work.
There are instances when welders might be involved in claims related to jobs that have closed in the past, depending on policy terms. This is one of the realities that can make it more complex for welders to provide insurance to, and it’s something that welders should be sure that they are prepared for.
What Else Does a Heating Device Endorsement Cover?
Your heating device endorsement will also sometimes cover smoke damage, scorching damage, melting of components or materials, blistering of paint, and damage from sparks, depending on policy language. There are lots of other instances that might be covered in your policy, and you can verify which situations are covered by reading the fine print of your policy.
Even items that are near your welding equipment that aren’t full of solvents can become damaged by the heat generated while you work, and the cost of replacement of these items can be enough to require claims to be filed.
Heat Damage Claims Can Be Tough to Dispute
Heat damage claims can be complex to argue with. These claims are investigated with an eye to finding out where the heat came from, whether sparks migrated, whether the utilized equipment was appropriate for the job, and more.
You might not document all of these processes as you work, which can lead to issues with finding fault and adjudicating on claims.
It’s key for welders to understand that even the slightest sign that sparks or heat might be causing issues for surrounding machinery or surfaces necessitates that they stop working and verify that things are okay. Being of the mindset that you are not going to be held responsible for damages isn’t wise and can lead to costly issues that need to be resolved.
Some commercial contracts with welders may require that these endorsements be verified before work can begin, which means that you have more of a reason than ever to have the right coverage for your business. Even if you are a small business or a single operator, you need to carry the right coverage to protect your company from losses.
Shops that have things like torches, cutting tables, portable heating tools, and other induction heating tools should also have this endorsement in place. Dry grass, dusty workspaces, old beams, flammable materials, and other items that you are not aware of are within the area that you are working, and can all lead to fire damage or heat damage. Even a building specifically designated for welding can have materials and items within it that can be damaged by your work processes.
The cost of your insurance may typically be far less than the cost of a claim, and this is key to remember.
Things to Remember
Your standard general liability policy might not carry heating device protections. You need to remember that hot work and sparks can quickly lead to things like fires or heat damage. Welders can sometimes be implicated in the damage associated with a fire, and it can be hard to prove that your work processes didn’t start a fire after the fact. Heating device endorsement might be required to secure some jobs, and the cost of your policy may likely be much less than the cost of a claim.
USA Business Insurance offers support and guidance for businesses looking to get the right insurance protections in place to protect their investment. Reach out to us today for a quote and find out how we can help you to secure the coverage that you need for your small or mid-sized business.
