Everyone needs insurance; that perfect and reliable plan that always has your back. Aside from obtaining suitable insurance plans for yourself, your car, and other important properties, it makes sense to consider your business.

For instance, if you run a construction business, the chances are that you’ll be prone to several liabilities. And one of the best ways to secure yourself and your business from pocket-draining liabilities is by leveraging the right insurance. And here is where some people get confused.

What type of insurance does our construction company need? Is it the standard insurance we acquire for our vehicles? Or typical home insurance?

Figuring out the type of insurance your construction business needs can be a hassle, especially if you have zero background in matters regarding insurance. So, to make things easy-breezy for you, we have decided to highlight the 4 essential types of insurance for construction companies.

1. General Liability Insurance

A company without general liability insurance is like a skinned chicken left out on a winter night. Such a company will be very exposed to various types of liabilities.

While it is normal for a business to invest in this insurance, construction companies are advised to take it seriously. Why? Because it shields your company from multiple liabilities that can wreak havoc on its finances and reputation. These liabilities include injury claims, medical expenses, public liability, etc.

Furthermore, this type of protection shields your company from damage caused by products you installed, like bad plumbing or faulty electrical wiring.

2. Professional liability insurance

It is human nature to make mistakes, regardless of how hard we try to prevent them. Professional liability insurance covers errors in design or value engineering on the job or changes that took place in the factory that resulted in a big problem with a project.

Unlike general liability insurance, which handles bodily injury and or property damage, professional liability covers those errors that could have a financial effect on a project. Mind you; it doesn’t finance the cost of rework but the liability of the mistake.

3. Pollution liability insurance

Here is another essential type of coverage for your construction company. With the rising pollution cases and the huge settlement that follows, it makes sense to contact a construction insurance company and talk about drafting a pollution liability insurance plan. That said, how does this coverage work?

It works by providing coverage if you are responsible for a pollution incident that happened at a construction site.

For example, if your company works with harmful chemicals or brings a fuel tank for refueling machinery on job sites, it creates the risk for potential pollution to happen.

4. Workers compensation insurance

Here is one must-have insurance for every business, especially construction companies. In fact, most states need some form of worker’s compensation insurance to shield employers from lost wages and cover their medical expenses should they suffer from job-related injuries.

Having workers compensation insurance comes with several benefits. First, it helps companies escape from lawsuits associated with injuries sustained by workers in the company’s premises.

Secondly, it can protect your employees and business from bankruptcy if they suffer from severe illnesses or accidents.  While the state often arranges premiums, there are several ways to reduce your work comp costs.

First off, you will have to reduce your experience modification factors, a factor evaluated by the state. To activate this, you’ll need to enhance safety and, by doing so, reduce the number and seriousness of injury claims.


As a construction company, you’ll need all the coverage you can lay your hands on. This will ensure you don’t waste your finances settling multiple claims and lawsuits. Having solid coverage like the ones mentioned above will protect the pocket of your company and its reputation.

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