How To Save On Commercial Insurance for Your Construction Company

How To Save On Commercial Insurance for Your Construction Company

Running a construction business is risky as your employees and workers are exposed to various risks. Did you know that 5,333 construction workers died on the job in 2019? As a construction business owner, buying a business insurance policy is one of the best ways to mitigate some of the risks and hazards that accompany daily operations.

However, you probably know that no two insurance companies are alike. This is because each offers a different comprehensive coverage at various price points and limits.

As a construction business owner, you are likely to spend too much on your construction premiums, and you also may be confused about what is worth the expense and what may be a waste of your limited business budget.

In this article, we will share some valuable and simple tips that will help you save on business insurance by lowering your insurance premium with the right policy.

Tips to Save on Business Insurance

1. Compare Quotes from Multiple Insurance Providers

As a construction contractor, you should compare policies and quotes to find the right insurance coverages at a reasonable price to meet your business needs. It is best to request quotes from multiple insurance carriers, as you can benefit from lower insurance rates and save on insurance.

Different business insurance policies for construction companies will vary in price from one insurance company to another. So, to give yourself the best chance of finding a great rate, you should shop around in order to find the best price for the insurance product you want.

You can also work with independent insurance agencies. They represent multiple insurance carriers, which means that they can shop around for your insurance quote and bring back the best option for your needs and preferences.

2. Look for Discounts and Bundling Opportunities

Every insurance company is different. However, you will be happy to know that many companies offer lower prices for combined policies. So, do not be afraid to ask for discounts. You may also find insurance carriers that specialize in the construction industry. They may offer the policies you need at reasonable prices.

You can also purchase a BOP, which is specifically designed for small businesses and will help you save due to its bundled commercial property and general liability insurance. The discounts are certainly out there; you just have to find them.

Another great way to save on business insurance for your construction company is to try bundling.

This is similar to buying a homeowner’s insurance. For example, in your personal life, you might have heard or seen commercials about bundling your home and auto insurance by using the best auto insurance companies. And you can do the same thing for your small business.

Bundling all of your commercial insurance products, such as worker’s comp insurance, with one insurer can save you considerable money in the long run. 

You have to compare rates for bundled insurance quotes -simply ask any prospective insurance company to create a quote for you that includes all the insurance protection you need.

3. Review your Coverage Regularly to Ensure You are Getting the Best Deal

Without frequently revisiting the forecasts, it is hard to determine whether your construction firm is on track. It is almost impossible to make significant revisions or updates to the original prediction if you are not fully aware of the original predictions and anticipated needs.

Remember that your insurance business is constantly changing, and your insurance needs and preferences will change along with it. This is why it is essential to review and update your insurance coverages every year to make sure you get the lowest rates. 

You may need a certain minimum coverage now that you did not need last year and vice versa. Therefore, taking some time to review your insurance policies with your agent will ensure you spend exactly what you have to and not a dollar more.

For example, if you’ve fewer construction workers or have sold machinery or equipment, you may ‌find some potential savings in your current insurance policies.

With constant and proactive discussion about insurance with your insurance broker or agent, you may use a higher deductible to buy broader and higher limits at a lower rate.

4. Implement Safety Measures

One step your construction firm can take to improve its risk profile, especially workers’ compensation risk profile, and save money on insurance, is implementing suitable safety measures and having a documented safety program. 

This program should include proactive processes to help you find and fix and mitigate workplace hazards and risks before construction workers are hurt on the job. For example, you can use the latest equipment with the best safety features and lower higher rates.

Through updating and improving the safety requirements you’ve on-site and implementing suitable safety measures, you will be able to save hundreds on your general contractors’ insurance.  You should also know that you can save on taxes by doing this? Many construction businesses and companies with great safety scores can get various tax breaks from the US government.

The safer your construction job site environment is, the better deal you will get with a comprehensive insurance company. 

So, to get a better price, you should follow all safety measures and recommendations from your insurance company, like enforcing safety precautions to avoid paying higher premiums in order to cover the additional risk.

5. Understand What Your Policy Covers – And Doesn’t Cover

It is vital to determine what typical insurance policies and limits are for a construction business like yours. Keep in mind that under-insuring your construction business is usually more expensive than over-insuring.

Understand what is covered and what’s not, since business insurance coverage limits vary drastically from insurer to insurer and policy to policy. Review each insurance policy and option carefully so that you know and understand what you are getting.

For example, every insurance policy mentions its inclusions and exclusions. These are the events that will and will not be covered. It is important to pay attention to these items as they determine the terms and conditions of your policy.

For instance, when reviewing business insurance quotes, you would like to understand the level of insurance each policy offers for property damage liability, bodily injuries, collision protection, personal injury protection, and uninsured motorist protection.

Read specifically what is and what is not covered by your insurance policy. Also, read the limits and terms of the policy. If you do not understand something, you can ask your insurance agent to walk you through it.

6. Pay Your Premium in Full to Avoid Any Extra Fees

If you have been on a payment plan, it is likely that you have been paying a fee for this privilege. Rather than paying monthly premiums, you should pay for your insurance 6 months or one year at a time. This will help you reduce your final insurance cost as you will pay upfront. 

It is almost always more affordable this way, as it does not cost the insurance provider money to process your payments every month. 

If paying in full seems like a huge expenditure, it’s a good idea to take this fiscal year and save some money for next year’s insurance premiums payment and lower your insurance costs.

7. Work with an Agent Who Can Help You Find the Right Policy and Coverage for Your Business

Smart and savvy construction business owners and contractors know that they have to do their due diligence and research in researching insurance options. While you will probably figure some of it out yourself with a variety of insurance comparison tools and online resources, it is best to work with an insurance agent. 

These professionals know insurance policies inside and out and can guide you through making the most suitable decisions for your construction business. These professionals can help you compare insurance rates and options, helping you save money on insurance.


By comparing multiple quotes, combining your policies, and reviewing them regularly, you can save a lot on business insurance premiums. If you want to learn more about how you can save on insurance costs, your questions can be answered by experienced insurance agents at Farmer Brown. We pride ourselves on providing a range of commercial policies for every kind of business in the construction industry for over two decades. Feel free to contact our knowledgeable agents and get started finding the perfect insurance for your business.