How much does insurance cost for plumbers?

Plumbers pay an average of $115 per month, or $1,378 per year, for general liability insurance.

Though usually not required by law, a general liability policy may be needed in order to sign a lease, get licensed in your state, or work with some clients.

General liability coverage protects your small business from common third-party risks, including bodily injuries and accidental damage to a client’s property. For example, if a plumber accidentally floods a client's home, this policy would cover the water damage and any legal defense costs.

Copyright infringement, defamation, and other advertising injuries are also covered by this policy. Most general liability policies include product liability insurance, also called products-completed operations insurance, which covers harm caused by a defective product or a completed service, such as a new water heater that leaks.

Below is the average general liability policy for plumbing contractors who buy from TechInsurance:

Premium: $115 per month
Policy limits: $1 million per occurrence; $2 million aggregate
Deductible: $500

General liability insurance costs are based on several factors, including the plumbing services you offer, policy limits, size and location of your business, and any subcontractors or additional insured endorsements you may have.

On average, plumbing businesses pay $166 per month, or $1,992 per year, for a business owner's policy (BOP).

A BOP combines your general liability and commercial property insurance coverage together at a discount. It protects your small business against both property and liability risks, such as stolen business property, a fire at your office, or an accident that harms a client.

This is the average business owner's policy for plumbing contractors who buy from TechInsurance:

Premium: $166 per month
Policy limits: $1 million per occurrence; $2 million aggregate
Deductible: $1,000

Many insurance companies include business interruption insurance, also called business income insurance, in their BOPs, or you can add it as an endorsement. This policy pays for financial losses if a fire, storm, or other incident forces your business to close temporarily due to a property damage claim.

Plumbing companies that qualify for a BOP usually are small in size (less than 100 employees) and low-risk. Learn more about business owner's policy eligibility.

Plumber's insurance costs for a BOP mostly depend on the value of your business property. Other factors include the size of your business, your location, the policy limits you choose, and your business revenue.

Plumbing contractors spend an average of $195 per month, or $2,337 annually, for workers' compensation insurance. To comply with state laws and avoid penalties, businesses with one or more employees typically must buy this type of coverage.

Workers' comp coverage pays for medical costs and disability benefits when you or an employee suffers a work-related injury or illness. For example, if a plumber develops knee problems after years of squatting and kneeling, a workers' comp policy would pay for their doctor's appointments, medications, and physical therapy.

Workers' compensation coverage usually includes employer's liability insurance, which pays for legal costs related to workplace injuries.

Some states require sole proprietors and independent contractors in the construction industry to obtain workers' comp even if they work alone. It's highly recommended in either case, since most health insurance plans can deny claims for injuries that occur on the job.

The cost of workers' comp is based on several factors, primarily the number of employees you have and their occupational risks.

Small plumbing businesses and contractors spend an average of $225 per month, or $2,704 per year, for commercial auto insurance. Almost every state requires this type of insurance for companies that own a vehicle.

If your business vehicle is involved in an accident, a commercial auto policy would help pay for any damages, including medical expenses, property repairs, and legal fees. You can also buy comprehensive coverage to gain protection against theft, vandalism, and storm damage.

To protect personal, rented, and leased vehicles used for business purposes, you'd need hired and non-owned auto insurance (HNOA) instead.

The cost of commercial auto insurance depends on many factors, including your employees' driving records, your policy limits, the number of vehicles you own, and the coverage options you choose.

Plumbers pay an average of $19 per month, or $224 yearly, for contractor’s tools and equipment insurance.

Tools and equipment insurance is a type of inland marine insurance, which covers business property that's in transit, stored off-site, or used at jobsites.

This policy covers tools and equipment that are stolen, damaged, or destroyed, such as pipe cutters, drills, wrenches, and augers. However, it doesn't pay for normal wear and tear. It's designed to protect gear that is on-the-go, covering items that are less than five years old and valued at under $10,000.

The cost of tools and equipment coverage depends mostly on the value of your tools and equipment. Another important factor is whether you choose to insure them for their actual cash value (the value of the used item) or their replacement cost (the cost of a brand-new replacement).

Construction businesses and contractors, including plumbers, pay an average of $65 per month, or $785 per year, for professional liability insurance.

Also called errors and omissions insurance (E&O), professional liability insurance covers financial losses related to mistakes, missed deadlines, and other instances of professional negligence. This includes attorney's fees and other legal expenses if a client decides to sue over unsatisfactory work.

For example, if a plumbing contractor uses the wrong materials and they corrode and damage a home, this policy would pay for the repair costs and legal fees if the homeowner sues.

This is the average professional liability policy for contractors who purchase from TechInsurance:

Premium: $65 per month
Policy limits: $1 million per occurrence; $1 million aggregate
Deductible: $1,250

The cost of professional liability insurance is determined by several factors, including the coverage limits and deductible you choose, the size of your business, the type of plumbing work you do, and your claims history.

Small plumbing companies and contractors pay an average of $250 per month, or $3,000 yearly, for commercial umbrella insurance.

This policy helps boost the coverage of your underlying contractor's liability insurance, such as general liability, commercial auto, or employer's liability insurance. When the underlying policy reaches its limit on an insurance claim, your umbrella policy activates to help provide any additional coverage that is needed.

Umbrella insurance is typically available in $1 million increments. You need to have another liability policy before you can buy this coverage.

The cost of commercial umbrella insurance depends mostly on the amount of coverage you buy. The same factors that affect the cost of the underlying policies can also influence your premium.

The average cost of a surety bond for plumbing contractors is $8 per month, or $100 annually.

Surety bonds protect your clients by reimbursing them in the event that your business is unable to fulfill the terms of a contract or agreement. For this reason, you may be required to obtain a surety bond in order to sign a client contract.

Some states require plumbers to have a surety bond as part of their legal requirements for a contractor's license. The bond guarantees that your work will comply with building codes and other regulations.

As with a fidelity bond, the cost of a surety bond is a small percentage of the total bond amount. Unlike insurance, you'll need to repay the company that issued the bond in the event of a claim.