Insurance costs for Contractors can vary widely. Insurance companies view roofers as a high risk. In fact, most standard carriers will not even write coverage for roofers. Why? Because they are one of the ten riskiest jobs. On the other end of the scale are jobs like grading of land.
The Jack of all Trades
Tinker, Handyman, or Jack of all Trades, regardless of the name you use, the risk is the same. A handyman is an individual that can perform a wide range of jobs. At first blush, it would seem that insurance for a handyman would be considered low risk. That is bad thinking.
Insuring a Handyman poses one major problem for insurance companies. What does a handyman do? Work performed is a primary factor in calculating premiums. We know what Roofers do. They install and repair roofs on homes and commercial buildings. A risky endeavor that warrants a higher insurance premium. Occupations that are less risky warrant lower insurance premiums. Such is the case for lawn care providers.
Handyman insurance premiums are significantly lower than roofers. They should be, the work they perform is not that risky. Or is it?
What does a handyman do?
Minor repair, light domestic work, or mechanical jobs are likely responses. Handyman insurance might cost more than one would think because no one knows what they are going to do. In the insurance industry, uncertainly almost always corresponds to higher premiums.
A Handyman might perform low and straightforward risk functions such as:
- Changing a light bulb
- Window cleaning, or
But itâ€™s more likely that they are performing higher risk jobs:
- Gutter Cleaning or Repair
- Window installation
But what happens when the handyperson starts playing jobs that require a license? A handyman can quickly alter their risk profile. By performing the following, then we are no longer dealing with a low-risk contractor:
- Heat, AC or plumbing installation or repairs
- Handicapped or Senior Living Modifications
- Electrical work
- Home Security Installation or Repair
- Foundation repair and installation
- Chimney sweep or Fireplace Repair
Some Jack of all Trades will, regularly, perform high-risk jobs. Can a handyman repair a roof?
What happens if, frequently, they start to replace entire roofs?
NO. IT DOES HAPPEN!
Bob the Builder or Tim â€śThe Tool Manâ€ť Taylor
Over the years, Hollywood has created several iconic Handymen and women. But it is the contrast between Bob the Builder and Tim “The Tool Man” Taylor that gets my attention. The performance of these two a generation ago are perfect examples. Both portraying handymen, they demonstrate the dilemma that confronts insurance companies.
Looking for someone with a toolbox full of tools that can fix anything? The animated character, Bob the Builder is your man. For an insurance company, Bob is a great risk. His attitude and skills allow him to complete any job. Doing things the right way means that the risk associated with Bobâ€™s work as a handyman is limited. As a result, he should warrant a low insurance premium.
But there is more to this discussion. The term, Jack of all Trades, is synonyms with Handyman. The original phrase was, â€śA jack of all trades is a master of none, but often better than a master of one.â€ť The expression is intended as a compliment. The original quote placed value on generalist, those with a broad set of skills.
Over time we have modified the phrase to â€śa Jack of all Trades, and a Master of none. In these instances, the Jack of all Trades is portrayed as someone skilled in many areas. However, their skill levels are most likely to be inferior. Some of you will remember â€śHome Improvement,â€ť a 90â€™s sitcom, starring Tim Allen. Tim portrayed another iconic Handyman; Tim â€śThe Tool Manâ€ť Taylor. Every week, Tim Taylor brought humor to American homes. We watched as he managed to once again foul-up another home improvement project.
Risk Management for a Handyman
The agents at TruePoint Insurance work with handymen. Our process provides insight into your business. With this information, we can find the appropriate coverages for your Handyman business. We will work with you to craft insurance coverage that addresses your risks.
Insurance is just one component of risk management. We will also work to help you to better understand all the risks. We could just sell you an insurance policy. But our goal is to protect your business in the most effective way we can.
The option is yours, the number is ours. Call now and get started.