There are 333,000 HVAC technicians in the US. People depend on HVAC professionals to keep them warm in the winter and cool in the summer. You are responsible for customers’ comfort in their homes. However, like every small business owner, you need insurance to protect yourself. Here are the five companies we recommend for HVAC insurance.
- The 5 best HVAC insurance companies
- What kind of insurance do hvac contractors need?
- What is a surety bond and why do HVAC contractors need one?
- How much does HVAC insurance cost?
- How much insurance do HVAC contractors need?
- How can I find cheap HVAC insurance?
The 5 best HVAC insurance companies
After researching several insurance companies, we recommend the following top 5 companies:
- CoverWallet: Best for comparing several online quotes
- biBERK: Best for a fast online quote
- The Hartford: Best for businesses looking for a solid and ethical insurer
- Hiscox: Best for a flexible payment plan
- Next: Best for a completely digital experience
CoverWallet: Best for comparing several online quotes
CoverWallet offers most types of business insurance, and they insure most industries. They work with several partners, including:
- Liberty Mutual
And more. They will only return quotes from their partners. Once you’re a CoverWallet client, you get your own personal advisor assigned to you. Keep in mind that CoverWallet is not an insurance company—they are a tech company that matches business owners with insurance companies.
One problem with CoverWallet is that they usually return 2-3 quotes from their partners, but not always. We got this message when we tried to obtain a quote for an HVAC contractor. When this happens, it is usually because the business has some complications or they need to validate some of the data and information you submitted in your quote form.
If this happens, you’ll have to call them. They will be able to provide several quotes for you to compare after verify the data and information of your business.
biBERK: Best for a fast online quote
biBERK makes it easy to get a quote. They originated in 2015 to address what they saw as a gap in the market: simple and affordable business insurance. They use AI to generate quotes, and quotes are always ready in a matter of minutes. Once you get a quote, you can buy the insurance online and coverage is immediate. And since they’re backed by Berkshire Hathaway, they have excellent financial strength.
The Hartford: Best for businesses looking for a solid and ethical insurer
The Hartford is one of the oldest companies of any kind in the United States. It’s been offering insurance solutions for more than 200 years and has helped one million plus businesses with their insurance needs, including HVAC contractor coverage. They also offer a wide range of business insurance coverages from general liability insurance, professional liability insurance, business owners policy (BOP), commercial property insurance, commercial auto insurance, to workers compensation insurance. The company takes pride in the fact that the Ethisphere Institute named The Hartford a World’s Most Ethical Company twelve times. The Hartford’s longevity and focus on ethical business practices makes it a company that you can feel good about doing business with.
The Hartford offers online quotes, although you can’t purchase the insurance online—you have to call an agent. But they have a full range of insurance policies for an HVAC contractor business, and their customer reviews are good. They insure over one million small business owners, and they’ve been in business since 1810, so they have a lot of experience.
Getting a quote online is easy: this is for a general liability policy for an HVAC contractor company with $500,000 in annual revenue.
Hiscox: Best for a flexible payment plan
Hiscox offers flexible payment options with no additional fees, which can be handy as a contractor. They have policies that are tailored to your HVAC contractor business, and you’ll be covered anywhere in the world.
The website is a little confusing, though. While you can google “HVAC contractor insurance” and Hiscox comes back as one of the top insurers, there is no option for HVAC contractor on the dropdown menu, and Hiscox won’t let you type it in manually. There isn’t even an option for contractors. For this reason, we recommend calling Hiscox to discuss your needs. They work with agents, so you can figure out what business insurance is best for you.
Next: Best for a completely digital experience
Next has a bright, easy-to-navigate website and online quoting is very user-friendly. You can get a 10% discount if you bundle more than one type of insurance. They insure almost every profession under the sun, and they offer most types of business insurance. They have excellent customer service reviews across all platforms. You can pay for your insurance by the month with no additional fees.
They don’t insure every state, though (although they say they’re working on that).
This quote is for an HVAC contractor in Pennsylvania with $500,000 in annual revenue.
What kind of insurance do HVAC contractors need?
Depending on the size of your HVAC contracting business, you might need one or more of the following business insurance coverages.
- General liability insurance
- Workers compensation insurance
- Commercial auto insurance
- Business owners policy (BOP)
- Inland marine insurance
- Professional liability insurance (also called errors & omissions (E&O)
General liability insurance for HVAC contractors
First, you should get a general liability policy. Since HVAC professionals enter clients’ homes and are in the business of moving heavy equipment, the potential for a third-party injury (in this case, the homeowner) is substantial. Also, since you’re in a customer’s home, it’s possible to accidentally damage some part of their home, and general liability insurance will cover that as well.
Many states require HVAC contractors have general liability insurance in order to obtain an HVAC license.
Workers compensation insurance for HVAC contractors
If you have any employees, most states require you to have workers compensation insurance. It protects your employees in case they are injured on the job and will cover their medical costs and their lost wages while they are out of work. It also protects you from employee lawsuits.
Commercial auto insurance for HVAC contractors
Since your job as an HVAC contractor involves driving around to customer’s homes, you’ll need business insurance to cover your vehicles, that is commercial auto insurance. Otherwise, if you get into an accident while driving for work, your personal auto insurance will not cover it. This goes for your employees as well. Commercial auto insurance will also cover your business vehicles if they are damaged due to weather or vandalism.
Business Owners Policy (BOP) for HVAC contractors
This combines general liability insurance with commercial property insurance and usually saves you money. Commercial property insurance protects your equipment from loss or damage. BOP is suitable for small businesses of less than $10M in annual revenue or having less than 100 employees. If your HVAC contracting business is qualified for the BOP policy, you should definitely consider it.
Inland marine insurance for HVAC contractors
Commercial property insurance covers your property while it’s in your business location. Inland marine covers it while it’s en route somewhere. Since you travel from customer to customer, you’ll need to protect your equipment while it’s in transit. If you often carry your equipment from one location to the other, you will need inland marine insurance coverage.
Professional liability insurance (or E&O) for HVAC contractors
If something goes wrong with work you did for a customer, professional liability insurance will protect you. Obviously, you want to provide excellent service and work for all customers, but sometimes the unexpected happens. Also, some clients may sue you for something that isn’t your fault. Keep in mind that professional liability insurance, or E&O insurance, doesn’t cover any subcontractors you use: they’ll have to provide their own insurance.
What is a surety bond and why do HVAC contractors need one?
A surety bond isn’t insurance, but it provides your customers with reassurance that your work will be thorough and professional. You are guaranteeing you will meet professional construction standards and adhere to all state and local regulations. A surety bond is a kind of contract between you, the customer, and the surety bond company.
You need a surety bond because you can’t get an HVAC license without it. Different states have different licensing requirements, and a few don’t require any license at all, so be sure to check with your state’s regulations. Also, many customers will be reassured that your work is up to standards if you have a surety bond and will be more likely to hire you.
How much does HVAC insurance cost?
The average cost of HVAC insurance is $62 per month or $732 per year for a Business Owners Policy (BOP). This is one of the most popular insurance policies for HVAC contractors. It is a bundled policy covering both general liability and commercial property.
HVAC contractors may need other coverages. If you add more coverages, your premiums will increase accordingly.
HVAC contracting is considered a higher-risk profession, so you’ll pay more than many other professions for your insurance. Make sure to shop with a few companies or a digital broker like CoverWallet, InsurePro, or Simply Business to compare several quotes to find the cheapest one for you.
Learn more at how much does HVAC contractor insurance cost.
What factors affect HVAC insurance cost?
How much you pay for HVAC insurance will depend on several factors such as:
- Location and size of your business
- Annual revenue
- Number of employees
- Years of experience in the field
- How much coverage you get
- Size of the area you service
How much insurance do HVAC contractors need?
That also depends, but many HVAC contractors get a $1M/$2M policy, which means $1 million in coverage per occurrence and $2 million during the policies lifetime. The policy renews every year, so it’s basically a limit of $2 million a year.
How can I find cheap HVAC contractor’s insurance?
Shop around is the best and most effective thing you can do to save money on your insurance. And don’t become complacent once you have insurance; you might save money if you switch insurance companies, so it’s important to get quotes every two-three years.
Make sure you follow safety standards and provide a safe working environment. Some insurance companies will provide risk assessments to make sure you are not leaving yourself vulnerable to accidents. Your workers compensation insurance rates will go down over time if you don’t file any claims and you can do that by ensuring the safety of your employees.
Every building, whether commercial or residential, has an HVAC system, making your business essential. You take care to provide the best service possible. However, things can still go wrong, which is why you need business insurance to protect yourself.