What Does Plumbing Insurance Cover?
Whether you’re a solo plumber or manage a growing team, having comprehensive plumbing insurance isn’t just a safety net — it’s a crucial investment in your business’s long-term success. When it comes to protecting your livelihood, knowing which types of insurance you need, how to choose the right policy, and how to minimize costs can make all the difference.
In this guide, we’ll break down essential plumbing coverages, explain how to find the best plan for your business, and answer common questions to help you make informed decisions.
Why Insurance for Plumbers Is Essential
When you first start your plumbing business, the associated risks most likely take a backseat to the excitement that comes with beginning a new chapter. Even if you’ve been in business as a plumber for a while, your main focus might not always be on what could go wrong. But plumbing is a profession that comes with unique risks that include everything from accidental property damage to on-the-job injuries. And without the right insurance coverage, a single accident or claim could jeopardize your entire business.
The Risks Plumbers Face
As a plumber, you’re likely to encounter a variety of occupational hazards. Specifically, these are the ones that make comprehensive insurance a necessity:
- Property damage: Mistakes can lead to serious consequences, such as a burst pipe or water leak, ultimately causing significant damage to a client’s home or business.
- Injuries: Slips, falls, or exposure to hazardous materials are only a few of the accidents that can (and do) happen during jobs.
- Equipment theft or damage: Plumbing tools and equipment are expensive to replace, and losing them to theft or damage can set your timelines back significantly.
- Liability claims: If a client or third party is injured because of your work, you could face expensive legal claims.
How Insurance Protects Your Business
As ominous as this all sounds, there’s good news, too: Having the right insurance policies in place can protect you from financial losses and ensure the stability of your business should the worst come to pass. Key coverages (more on these next), can help you recover repair costs, medical expenses, and legal fees instead of facing these expenses out of pocket.
Types of Plumbing Insurance Coverage Your Business Needs
Plumbing insurance doesn’t come in a prepackaged plan (like homeowners and auto insurance does). Instead, plumber’s policies are made up of a variety of coverages that protect your business from the consequences of specific threats, such as accidents, property damage, or legal claims. Here are the six types of insurance that every plumber should have in their policies:
1. General Liability
What it is: A foundational policy that protects against any claims of bodily injury, property damage, or reputational harm from third parties
What it covers:
- Damage to a client’s property
- Injuries sustained by a client or third party on a job site
- Legal fees if you’re sued for damages
Why it’s important: Even a minor accident can lead to costly claims. General liability insurance ensures you don’t have to pay out of pocket for unexpected lawsuits or damages.
2. Commercial Property
What it is: Coverage that protects against direct physical loss of or damage to property due to a covered cause of loss
What it covers:
- Damage to your business property due to events that may include fire, lightning strikes, or robberies
- Replacement costs for stolen or damaged tools and equipment
Why it’s important: Plumbers rely on expensive tools and equipment to get the job done. Without coverage, the cost of replacing stolen or damaged items can be devastating.
3. Workers’ Compensation
What it is: Coverage that provides medical benefits and wage replacement if an employee is injured on the job or falls ill as a result of job-related activities
What it covers:
- Medical expenses for work-related injuries
- Lost wages while an injured employee recovers
- Employer liability if an injured employee sues
Why it’s important: Most states require businesses with employees to carry workers’ compensation insurance. Even if it isn’t mandated, investing in a policy to protect both your workers and your business is strongly encouraged.
4. Commercial Auto
What it is: Insurance for work vehicles used in conjunction with your plumbing business
What it covers:
- At-fault collisions that hurt other people or their property
- At-fault collisions that hurt you, your employees, or your company property
- Non-fault collisions that result in damage or injury, caused by uninsured and underinsured drivers.
- Physical damage or property loss not caused by an auto collision (e.g. by nature, theft, or vandalism)
- Personal medical expenses from an accident
Why it’s important: Personal auto insurance doesn’t cover business-related use. If you or an employee are involved in an accident while driving for work, your commercial auto policy ensures you’re protected.
5. Professional Liability
What it is: Covers claims related to mistakes, negligence, or failure to deliver services as promised (also called errors and omissions, or E&O, insurance)
What it covers:
- Legal costs if a client claims your work was faulty or incomplete
- Damages resulting from professional errors or negligence
Why it’s important: Even highly skilled plumbers can face claims of faulty workmanship. Professional liability insurance helps protect against lawsuits that could potentially shutter your business.
6. Umbrella
What it is: Extra liability coverage that extends beyond the limits of your other policies.
What it covers:
- Provides additional coverage for general liability, commercial auto, and workers’ compensation claims that exceed policy limits
Why it’s important: If a claim exceeds the amount your policies cover, umbrella insurance kicks in to ensure you won’t have to cover the remaining costs out of pocket. It provides an extra layer of financial security for your business.
How to Choose the Right Plumbing Insurance Plan
There’s more to getting plumbing insurance than just purchasing any policy — it involves finding the plan that fully protects your business from the risks you face on-the-job. With so many available coverage options, choosing the best policy requires careful consideration. Here’s what to do:
Assess Your Business’ Needs
Every plumbing business is different, and therefore, so is every plumbing insurance policy. For comprehensive coverage, your insurance plan should be tailored to your specific situation. By evaluating the following aspects of your business, you can determine which insurance policies are essential and how much coverage you need:
- Business size: A one-person operation will typically need less coverage than a company with multiple employees.
- Location: Local laws and regulations may impact required coverage types.
- Services offered: If your business specializes in high-risk plumbing work (e.g., sewer line repairs or gas pipe installation), you may need additional protection.
- Equipment and vehicles: If you rely on expensive tools or a fleet of vehicles owned by your business, you’ll need the appropriate coverages.
Consider Working With an Insurance Broker
The choice between working with an insurance broker or purchasing coverage directly from a provider is an important decision. While going to an insurance company directly might seem like the obvious choice, partnering with a broker offers several benefits, including:
- Access to multiple options: Brokers have established working relationships with many different providers and can compare multiple policies to find the best fit.
- Securing the best rates: Access to so many different insurance carriers means brokers can shop for today’s best coverage programs and rates on your behalf.
- Expert guidance: Brokers understand the specific risks that are a part of the plumbing business and can recommend the appropriate coverages.
- Help with claims: After you select your policy, brokers can assist in navigating the claims process should you need to submit one.
Compare Multiple Policies Before Making a Decision
Not all insurance policies are created equal. Before selecting a plan, compare key factors across different providers to avoid ending up with inadequate (or too much) coverage:
- Premium costs: The amount you’ll pay for coverage on a monthly or annual basis
- Coverage limits: The maximum amount your policy will pay for a covered claim
- Deductibles: The amount you’ll need to pay out of pocket before insurance coverage kicks in
- Exclusions: Specific situations or risks that the policy doesn’t cover
Review & Update Your Policy Regularly
Your work isn’t done once you choose a policy. As your business grows and its needs change, it’s important to periodically review your plumbing insurance coverage. Consider revisiting your policy when:
- You hire new employees or expand your team
- You invest in new tools, vehicles, or office space
- You begin offering new services (as they may introduce additional risks)
- Your revenue or client base significantly increases
FAQs
Q: Do I need insurance if I’m a solo plumber?
A: Yes, even if you’re a solo plumber, having insurance is essential. Accidents can happen at any time, and without coverage, you could be personally responsible for costly claims.
Q: How much does plumbing business insurance typically cost?
A: The cost of plumbing insurance varies based on several factors, including the size of your business, location, coverage limits, and the types of services you offer. To get an accurate estimate, it’s best to request quotes from multiple providers.
Q: What happens if I don’t have workers’ compensation insurance?
A: If you have employees and fail to carry workers’ compensation insurance, you could face severe consequences, including paying legal penalties and fines, out-of-pocket costs if an employee is injured at work, and costs associated with potential lawsuits. Even if you don’t have employees, some states require this type of coverage for yourself. To ensure compliance, check local regulations when in doubt.
Q: Can I bundle different types of insurance to save money?
A: Yes. Many insurance providers offer business owner’s policies (BOPs) or customized bundles that combine multiple coverages at a discounted rate. Bundling policies not only saves money but also simplifies policy management by consolidating coverage under a single provider.
Q: Is plumbing insurance tax-deductible?
A: Yes, plumbing insurance coverage is generally tax deductible as a necessary business expense. Premiums for business policies can typically be deducted from your taxable income. However, personal-use portions of coverage (for example, personal use of a work vehicle) may not qualify. Always consult with a tax professional about how to properly deduct insurance costs for your plumbing business.
Protecting your plumbing business with the right insurance coverage is one of the best ways to secure your livelihood. No matter which coverage your plumber’s insurance policy needs, the team at C&S Insurance is here to help you build a policy that fits. Contact us today to explore your coverage options and get the peace of mind that comes with knowing your business is protected.