What Insurance Policies Do Drywall Contractors Need?

Drywall contractors ensure walls and ceilings are smoothly finished and ready for painting or wallpapering—whether in residential homes, commercial buildings, or large-scale projects. No matter the size of the job, these professionals play a critical role in the construction and renovation industry, giving buildings the finishing touches to become completed projects.

If you’re a drywall contractor, you may wonder what kind of insurance you need to adequately protect your business from the unique risks you face daily. From the potential for property damage to liability issues, it’s essential to have strong insurance coverage and a carrier that understands the industry.

This article outlines expert tips from Matt Sbordone, a construction underwriting specialist with Central Insurance, to learn what insurance policies drywall contractors need to protect their vital business.

What is a Drywall Contractor?

A drywall contractor is a specialty tradesperson who self performs their work. Hiring a professional drywall contractor ensures specialized artistry and efficiency. They can use their expertise for: 

  • New Construction: After the plumbing, mechanical, and electrical work is complete, a drywall contractor can construct framing, install installation, and place drywall. They ensure smooth, even surfaces for walls and ceilings within new buildings.
  • Renovations: Drywall contractors can update or repair structures with issues such as damaged walls, outdated designs, or structural modifications. 
  • Commercial Projects: Drywall contractors can handle large-scale installations that require adherence to building standards, including office buildings, retail spaces, and other commercial properties with strict adherence to regulations.

Challenges Drywall Contractors Face

There are distinct risks for drywall contractors compared to other contractors, making specialized insurance essential. Here are the most common challenges you may encounter.

High Risk of Injury Installation is a physically demanding task involving various tools. Falls, cuts, and muscle or joint strains are common. From 2011 to 2022, workers in specialty trades, such as roofing, electrical, and drywall installation, accounted for almost 70% of fatal and nonfatal falls.
Property Damage Mistakes in drywall installation can cause significant property damage, leading to costly repairs, including water damage from improper sealing or fire damage from the improper installation of fire-resistant drywall.
Liability Issues Installation errors or omissions can lead to legal disputes and significant financial losses. Drywall installed incorrectly can compromise the integrity of walls and ceilings, resulting in structural failures or building code violations.

Five Essential Insurance Policies for Drywall Contractors.

To mitigate these unique risks, consider insurance policies catering to your work. While it’s always best to work with your insurance agent to ensure adequate coverage for your specific business, Sbordone outlines the five essential policies all drywall contractors should invest in below.

1. General Liability Insurance

While general contractors may have some room to shift liability to their subcontractors, drywall contractors do specific work themselves. Thus, you can be solely liable for the entirety of the work you do. This policy protects against third-party claims for bodily injury, property damage, and advertising injury. State licensure requires General Liability insurance, and most general contractors require it of their subcontractors to get on a site.

For Example, if a contractor accidentally damages a client’s property while installing drywall on the job site, General Liability insurance may cover that third-party property damage. A Contractor could also be liable on a job site for bodily injury if one of their employees left a tool that someone tripped over. The General Liability coverage may cover these Bodily Injury and Property Damage claim scenarios and any legal fees incurred defending such claims.

2. Workers’ Compensation Insurance

Given the physical nature of drywall work, injuries can occur frequently. Workers’ Compensation insurance covers medical expenses and lost wages for injured employees, ensuring the worker and employer are protected. If you have employees, this a highly recommended coverage to ensure your employees are cared for in the event of a workplace injury

According to the National Safety Council, nonfatal injuries that require days away from work cost employers $42,000 each, while fatal injuries can cost employers over $1 million per incident. With Worker’s Compensation insurance, your business won’t take the financial hit when an incident occurs.

3. Commercial Auto Insurance

Drywall contractors often rely on vehicles to transport expensive materials and equipment. Commercial Auto insurance coverage can cover damage to your vehicle fleet, including accidents and theft. In contrast, Auto Liability insurance can cover expenses when you’re liable for bodily injury to others or damage to their property.

“One bad loss can cause bankruptcy for specialty contractors,” Sbordone explains. “An Auto Liability policy promises to be there for you when you have an accident on the road.”

4. Inland Marine Insurance

Drywall contractors use various tools and equipment, from drywall lifts to taping knives. An Inland Marine policy provides protection for items and tools that are either excluded or covered on a limited basis under a standard commercial property. For contractors, this could cover repairing or replacing tools and equipment if they are damaged, lost, or stolen, regardless of location.

Contractor’s tools and equipment can be covered under an Inland Marine policy,” Sbordone says. “An inland marine policy has a unique mobile nature, so your coverage is provided throughout the territory you work in.” Inland marine insurance lets you travel from site to site and know your equipment is protected.

5. Professional Liability Insurance

Also known as Errors and Omissions (E&O) insurance, this policy protects against negligence or faulty workmanship claims. Professional Liability insurance covers legal defense and settlement costs if a client claims your work was substandard or caused them financial loss.

Imagine you complete a commercial project, but a miscalculation leads to improperly aligned drywall. This results in visual and structural conflicts and costly repairs for the client. Without E&O insurance, the contractor would be liable for these costs and potential legal fees. E&O insurance would cover these expenses, protecting the contractor’s business from financial loss and legal disputes.

Choosing the Right Carrier as a Drywall Contractor

Choosing the right insurance carrier and consulting with an experienced insurance agent is crucial for drywall contractors seeking comprehensive coverage. A reputable carrier with a strong track record in the construction industry can offer tailored policies for the unique risks associated with drywall installation.

Central Insurance offers expansive resources and expertise for policyholders within the construction sector. When it comes to insurance claims, policyholders can find construction specialists at Central who understand industry trends and challenges through experience.

As Central’s construction underwriting specialist, Matt Sbordone combines technical expertise with relationship building. The construction industry is inherently risky, with dangerous job sites and costly claims. Sbordone and Central’s Construction Underwriting team works closely with policyholders to bring expertise into insurance support and solutions.

“When something does happen, Central is going to be there to adjust a construction-based claim fairly and promptly,” Sbordone says. “But we’ll also work with you to reduce, mitigate, and prevent claims through loss control.

At Central, dedicated Loss Control Construction Specialist Jim Johnson works closely with construction clients to evaluate job site exposures and prevent losses. His expertise leads a team committed to reducing claim deductible dollars for policyholders. He also helps protect the people Central policyholders employ by improving overall site safety. 

Supporting our policyholders by preventing losses is an essential extension of our commitment to caring for those who trust us. Central policyholders can benefit from loss control specialists who work with you to create a personalized plan, provide on-site training and evaluations, and are 100% dedicated to keeping your business safe. 

The Central Difference

At Central, our dedicated Construction team focuses on adding value to our partnerships. Drywall contractors can avoid costly insurance claims by partnering with an independent Central agent to design an insurance plan that ensures security and peace of mind.

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