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Inssurance Question???

Discussion in 'Business Fundamentals' started by Sharpshooter77, Jul 19, 2006.

  1. Sharpshooter77

    Sharpshooter77 Senior Member
    Messages: 162

    Hello everyone, I am new to this site today. I already have been going through it and the information here is great. But I have a question on insurance for plowing. I have been plowing for 5 years for a company. But now I have my own truck, the truck is a 1985 F-250 with an 8 foot fisher. I wanted to know how much would the insurance for plowing cost (ball park figure) and what package should I get. Also I am only going to be doing a few drive-ways mostly for friends and family, and a few clients. And all plowing will be drive-ways. THANKS :waving: :waving:
  2. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    You will need:

    1. Commercial Vehicle insurance which replaces your regular vehicle insurance


    2. General Liability insurance - Covers what is called "Completed Operations

    Cost vary widely by area, personal situation and what type accounts you have. You should get a bare minimum of $300,000 and generally $1,000,000 is common for the sole operator. As an example of the variability of cost for GL, I pay $861/yr for $1,000,000 as a sole operator which is low. But I'm 57 yrs old with a clean claims record and a five year history in the industry. I live in a very rural area of a state not known for lawsuits. Others pay several thousands for the same coverage in, for example, New Jersey.

    To learn more about the insurance issue, do a Search and type in "Commercial Insurance", then "General Liability". Have several hours for reading.
  3. basher

    basher PlowSite Fanatic
    from 19707
    Messages: 8,993

    What Mick said, only I suggest $1,000,000 as the minimum. Having been sued a couple times, I know the need for the insurance. Both suits where dismissed eventually, but the cost of legal bills was in the 10s of thousands each time. Thankfully I am well insured, they paid the legal bills and because the suits where dismissed and we were not found at fault our rates have not gone up.

    If you are only insured for $300,000 and the plaintiff is awarded $500.000 you are on the hook for the extra 200 grand. In a world of unreasonable legal awards, if the plaintiff wins, the amounts often exceed the million mark.

    Good commercial insurance, good contracts, and good paperwork (run sheets tracking services provided, both time lines, and material) are essential to protect your liability. If you personal insurer discovers you charged (money, baked goods, sexual services, etc..) for your services they are no long liable for your actions. They can sue you to recover any monies they spent on your behalf.
  4. DaySpring Services

    DaySpring Services PlowSite.com Addict
    Messages: 1,065

    My general liability (1 Million coverage) is costing me $1600 a year.
  5. Ramairfreak98ss

    Ramairfreak98ss PlowSite.com Addict
    Messages: 1,931

    well my luck because im in shitjersey. Anyway, your coverage you guys are quoting is for your i guess lawn or landscape business AND snow plowing or ONLY covers you while snowplowing? that seems hardly worth the cost of plowing even if it snows 6times heavy enough per season.
  6. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    It may work differently in other states, but I had an agent explain it to me one time, and this is how it works here:

    You buy insurance for "general liability", that is you are insured for anything you do. If a claim is filed and you are found to be at fault, the insurance will pay (and sometimes they will pay just to "settle" without a finding of fault). The problem comes in AFTER they pay the claim. It is then that the insurance company will decide if the claim was paid against a "listed activity". This is one which the insurance company acknowledged you are engaged and is shown on the policy - hence "listed activity". If it is not a listed activity, they will pay the claim anyway. Then they will cancel you immediately and will not renew. Because they cancelled you and because General Liability insurance is not required by any law, no other insurance company will issue you a policy since a cancellation for cause is listed on you record.

    Insurance rates are set by a number of factors, including the activity in which you are engaged. The more risk to them, the higher the premium. Insurance is charged a year at a time, regardless of the amount of the year you are engaged in an activity. So, if you are engaged in plowing snow only and the rate is $1,000 per year, that is your premium - $1000. But, if you plow snow for half the year and mow grass the other half and the rate for mowing is $500 per year, your premium is $750/yr (1/2 year at $500 and 1/2 at $1000 or $250 + $500 = $750 for the yearly premum). But you can't just buy 1/2 year policy - in my case I need six months for plowing.

    Hope this helps some.
    Last edited: Jul 25, 2006
  7. lodogg89

    lodogg89 Senior Member
    Messages: 412

    I dreaded buying insurance after reading all the post on the expense and the hassle of it. I finally insured my truck commercialy and got a 1,000,000 dollar policy and it was less than i was paying before on personal insurance. The general liability portion covers my lawn and landscape as well as plowing. i didnt add any equipment on yet but he said its about 100.00 a year per 10,000 dollars added. BTW i have american family insurance.
  8. Jay brown

    Jay brown PlowSite.com Addict
    Messages: 1,783

    be glad your not in the roofing business. our new gl policy is going to be $10,000 anual premium for a 300k limit. and this does not include snow removal. work comp is another $20,000 per year. vehicals and property is another $10,000. total of $40k per year. all of this for 3 full time employes.