Independent heating, ventilation, and cooling companies are a staple of the American economy. Every home needs well-maintained air conditioning units and proper ventilation, so there is always plenty of work to do. Starting an HVAC company isn't as simple as hanging out a shingle, though. For one thing, a lot of the clients who will call you will want to see evidence that you are insured.
This is because it is a risky business. HVAC employees are in people's homes, moving heavy items, and working with electricity. There are risks of bodily injury to the employees and damage to your equipment. There are also legal risks involved in servicing people's heating and cooling systems. These risks can be expensive for your company, requiring you to spend a lot on replacing equipment and covering legal fees.
These risks may all feel worth it at a personal level because you own your company and are providing necessary services to people. But it can make protecting your business complicated. The best first step in making sure your company can take these risks is to get the right insurance. Consider these elements of coverage:
Business Owner's Policy
A business owner's policy, or a BOP, is a smart way of insuring your company against many common problems. It is a bundle of insurance policies that you can buy together to cover your business. Often, an HVAC company's BOP will tie general liability and property insurance together. What else will be included in the policy will vary depending on:
- How big your company is,
- What type of equipment you use, and
- Your legal liability.
Consequently, how much the bundle of policies will cost will be difficult to predict.
Construction jobs have a lot of inherent risks involving bodily injury and property damage, and HVAC repairs are no exception. Construction insurance can cover the costs of these events by bundling together general liability, commercial auto insurance, and many other types of insurance. You may need it if your company handles more than routine maintenance and repairs.
General liability, or commercial liability, insurance covers the costs of lawsuits. If a customer's property gets damaged, improper ventilation leads to moisture buildup behind walls, or people get hurt through your work, you can be facing a lawsuit and have to pay for claims. Your average general liability policy will cover up to $1,000,000 per claim with an upper limit of $2,000,000. But you can customize your coverage to fit your particular liability needs.
An HVAC company uses many pieces of equipment, and they tend to be expensive. Property insurance will cover the expense of replacing equipment if it is stolen, gets lost, or is damaged in ways specified in your policy. There is also equipment breakdown insurance, which can cover the price of fixing things that break. How much your property insurance will cost will depend on:
- Whether you are bundling it in your business owner's policy, and
- What sort of equipment and materials you are insuring.
Professional liability, also called professional indemnity insurance or errors and omissions insurance, covers the cost of malpractice cases. General liability often does not help with any legal claims that you were negligent or made a mistake in your work. But professional liability specifically covers such claims made by a client within the time period that it describes.
Commercial Auto Insurance
The truck or van for your HVAC company is an integral part of your business, and getting it into a car accident could cost your company a lot. Commercial auto insurance will cover many of the repairs and many of the legal fees that may be involved. Your average policy limit for commercial auto insurance is $1,000,000, but this can vary depending on many factors. A big company with a fleet of vans may need something different from an individual buying a used van for his business.
Workers' Compensation Insurance
If your company employs anyone, workers' compensation is highly recommended. Most states, such as Oklahoma, require employers to have workers' compensation insurance. Even when it's not legally required, it's a practical requirement. The HVAC repair industry requires a lot of heavy lifting, dealing with electricity, and getting into cramped spaces. This coverage helps ensure that an employee who throws his or her back out on the job will be able to afford the medical care that will get them working again.
If you are feeling overwhelmed by the task of finding good insurance quotes, CommercialInsurance.net can help. Enter your zip code in the field at the top of the page and then click 'Let's Start.' Alternatively, you can call us at 1-877-907-5267 and get a specialist. Doing either will get you a representative who will find insurance quotes to match your needs, which will get you started in protecting your business.