Running an HVAC company is not an easy thing to do. Not only do you have to worry about serving all of your customers and diagnosing any HVAC issues they have, but there are also extra business pressures to think about, like payroll, customer complaints, employee conflicts, and so much more. Many of these areas seem daunting, but with enough experience they can be handled with confidence. However, one area of running a business that isn’t as easy to deal with is insurance. Many HVAC companies believe that they are managing their insurance effectively, but this is often not the case. There are many mistakes that HVAC businesses make when it comes to insurance that not only make their coverage inefficient, but can also put their entire business in jeopardy if something goes wrong. Here are some common insurance mistakes for HVAC companies, and how they can be fixed.
HVAC Insurance Mistake 1: Not Insuring Tools & Equipment Left In Vehicles
One of the most common insurance mistakes that HVAC companies make is failing to consider how automobile insurance typically does not cover valuables left inside the vehicle. For example, even though your work van may be covered by commercial auto insurance, if it gets stolen you will likely not be able to receive compensation for any tools or equipment left inside. Auto insurance for your HVAC company’s vehicles typically only extends coverage to the actual vehicle itself, not the items inside of it. Without the proper theft coverage or equipment insurance, you could be at risk of having to pay for your equipment if it is stolen or damaged while inside of your vehicle, even with the vehicle being insured.
HVAC Insurance Mistake 2: Forgetting The Importance Of Errors & Omissions Liability Insurance
A second insurance mistake made by HVAC companies is the assumption that all of their work is covered by general liability insurance. It’s easy to believe that if you or your employees make some mistake while installing an HVAC system or performing maintenance for a client, any damage caused by that mistake will be covered by your general liability coverage. However, this is not always true. Damages related to advice, design considerations, or measurements are actually covered under a separate policy known as errors and omissions liability insurance, whereas general damages like breakdowns or leaks would be covered under general liability insurance. HVAC companies need to make sure that they have the proper coverage for these different claims they may encounter.
HVAC Insurance Mistake 3: Having Different Carriers For Commercial Auto Insurance & General Liability Insurance
When it comes to insurance for HVAC businesses, there can often be a gray area when unloading and loading equipment from work vehicles to the customer’s home or business. When claims happen here, they might fall under both commercial auto insurance coverage and general liability coverage. If your HVAC business has separate carriers for both of these policies, it can be a real nightmare to try to move forward and get these claims resolved, as both companies may try to deflect blame and responsibility onto the other. But by keeping your HVAC auto insurance and general liability insurance with the same carrier, not only do you get clearer communication and quicker claim processing, but your HVAC business could also save money by bundling coverages.
HVAC Insurance Mistake 4: Failing To Verify Insurance For Subcontractors
Hiring subcontractors to help your HVAC business with work can be a very wise decision, but you must be careful to make sure that they are all properly insured. If one of your subcontractors creates damage for a client, and they do not have the proper coverage to pay for the incident, the liability may fall on your company to resolve the damages. This can be a serious financial roadblock to your HVAC firm, and might create serious hardships, even bankruptcy. Before hiring any subcontractors to help you with your HVAC work, ensure that they have the proper coverage and certifications to prevent yourself from having to pay for their mistakes.
HVAC Insurance Mistake 5: Not Reviewing Insurance Requirements When Signing Contracts
Without expert advice, it can be very challenging to understand the insurance requirements that are included in contracts of bigger HVAC jobs. When HVAC companies do not properly review the insurance requirements in these contracts, they may be consenting to coverage obligations that their current insurance policy is not equipped to handle. This can lead to the HVAC company having to pay for policy changes, rejected claims, and it may even result in having to pay fines for non-compliance, not to mention the fact that if something goes wrong, your HVAC business does not have the proper coverage.
HVAC Insurance Mistake 6: Having Inaccurate Advertising Or Licensing Information
When planning your HVAC business insurance policy, it is essential that you properly describe what services you complete to guarantee you have the proper coverage for anything that can go wrong during the course of your business. Issues arise when HVAC companies do not properly tell their insurance companies about the work they actually do, or they do not have the proper licensing information given to their provider. When this happens, confusion and conflict may arise about what is actually covered by their policy. On a similar note, if HVAC companies do not properly advertise their work to their customers, they may be responsible for false claims that happen during conflict with customers. HVAC companies must make sure that their advertising and licensing is all aligned, so that way any miscommunication or misrepresentation can be eliminated.
HVAC Insurance Mistake 7: Not Having The Proper Coverage For A Home-Based HVAC Business
If you are an HVAC contractor and you use your home to store materials or tools, you might not be aware that homeowners’ insurance typically does not cover items related to your business. If your home were to be damaged in a fire, robbery, or other disaster, the damage to your equipment and business resources may not be covered. Additionally, if your home becomes damaged as a result of your business operations (you cause a fire while trying to weld work equipment together), your homeowners’ insurance might not cover this damage because it was related to work. Make sure that you structure your insurance correctly to include the proper coverage for your home, as well as coverage for any work-related items stored in your home.
Avoid HVAC Business Insurance Mistakes – Get Coverage From Strickler Today
At Strickler Insurance, we want to help HVAC businesses avoid these common problems and make sure that their company is on track for success. We help HVAC businesses make sure they have the proper coverage for if something goes wrong, eliminating risk and giving business owners peace of mind as they grow their company. We can find commercial auto insurance, general liability insurance, errors and omissions liability coverage, and any business owners’ insurance policy your HVAC business might need to succeed.
If you are ready to get started and ensure that your HVAC business has the proper coverage, the experienced team at Strickler Insurance can help. Contact us today get started.
