Commercial Auto Insurance
Most carpenters use their work truck as a mobile office that they work from. Getting the right insurance is important to protect the truck adequately. Some carpenters make the mistake of using personal auto insurance to insure their work trucks. This means insurance can deny a claim if the truck causes an accident while driven for work.
Vehicles used for work purposes should have commercial auto insurance. This insurance policy specifically classifies the work truck as a commercial vehicle. It provides the right protection for at-fault accidents and incidents that may lead to damage to the truck itself. For example, if you rear-end another car on your way to a job site, you are liable for the damages to the other vehicle and may need to have your own truck fixed as well. Your commercial auto insurance policy covers this.
Surety Bond
A carpenter may also need a surety bond, an insurance product that guarantees that the carpenter will maintain contractual obligations to clients. The way it works isn’t like traditional insurance products. You buy the surety bond for a nominal fee – bonds are usually much less expensive than insurance. If the client feels that you breached your contract, he can place a claim on the bond. If paid, the carpenter must repay the amount to the insurance company.
Some local counties might require a licensed carpenter to have a bond to maintain his licensing. The bond is also a good idea for carpenters because it helps them appear more professional to prospective clients, helping them land more contracts.
Excess Liability
Insurance policies come with policy limits. This isn’t unusual in any respect. While those limits are usually enough coverage, there are instances where it isn’t. A general liability policy might have limits starting at $100,000 going up to $1 million. You’ll need to get an excess liability insurance policy if you want higher limits.
Excess liability insurance serves as a second policy to a general liability policy. The general liability policy will pay up to policy limits during a claim, and then the excess liability policy will kick in. Excess liability allows you to get maximum protection for less money.