Excavators play an essential role in any construction project. Often overlooked is how high-risk it is, and many things can go wrong on site.

Construction sites are not only dangerous to employees but also to the public. Without the appropriate insurance coverage, a simple claim could leave your excavation business financially constrained due to costly legal fees.

What kind of insurance does an excavation business require? Keep reading to find out more about the risks associated with excavation and the costs involved. 

Risks associated with excavation

Excavation work is dangerous. Expanding your awareness of the risks involved will help keep you prepared for any mishaps or accidents. Some common risks associated with excavation include:

  • Falling into a pit
  • Collapsing earth
  • Striking buried electrical cable 
  • Slides or cave-ins 
  • Misuse or misfire of explosives
  • Machinery misuse or accidents

What is Excavation Contractors insurance?

Due to the high risk associated with an excavation business, insurance is necessary to ensure protection against claims and coverage for unexpected incidences.

There are various policies offered to excavation contractors. The two most important policies include Excavators General Liability insurance and Worker’s Compensation insurance.

1. General Liability insurance

In a situation where you or your business damage third-party property or are responsible for bodily injuries to a non-employee, you are at risk of a claim lodged against you. 

A general liability claim put through court can average over $75,000.00, including defense and settlement payments. That is enough to sink a small business in its entirety and can be avoided by having the right insurance coverage.

Note: General Liability insurance does not cover injuries to your employees, damage to your property, and several other instances. 

2. Workers Compensation insurance

In conjunction with General Liability insurance, it is recommended you include Workers Compensation insurance to help fill in some of the gaps of coverage.

Worker’s Compensation covers you and your employees in the case of injuries, illness, and even death. We recommend reading this article about How To Save on Your Workers Compensation and how you can benefit from this policy.

According to data from the Bureau of Labor Statistics, around 25 employees are killed annually from trench-related accidents alone. Business owners are responsible for covering the costs of onsite death and injuries.

Note: In some states, Workers Compensation insurance is compulsory for all employers. 

Policy additions for excavators

Along with General Liability insurance and Workers Compensation insurance, there is other additional coverage your business will benefit from:

  • Auto Liability coverage
  • Excavation Contracting Property coverage
  • Commercial Umbrella policy

Cost of excavation insurance

Depending on your company’s scale of operation, location, and other factors related to your excavation business, premium rates will differ. 

Construction workers

It isn’t easy to predetermine how much your premium will cost without an evaluation. However, the average rates for General Liability insurance for contractors are between $700 – $1,200 per annum.

Are you covered?

If you have an excavation business, no matter how small, making sure that you are properly insured and covered for a worst-case scenario will only contribute to your business’ success. If you already have insurance, get to know your policy well and what coverage it provides. 

It could very well be time to update it as your business has grown.