Five Tips on Insuring a Landscape Business
Running a landscape business involves a lot of moving parts—both literally and figuratively. While focusing on equipment, employees, and clients, one critical aspect that often gets overlooked is insurance. Having the right insurance coverage is not just a smart business move; it’s essential for protecting your livelihood. Whether it’s safeguarding your vehicles, employees, or costly equipment, the right policies can save you from financial headaches down the road. In this article, we’ll explore five essential tips to help you navigate the complexities of insuring your landscape business and ensure you’re properly covered.
General Liability Insurance
General Liability Insurance is probably the most common policy that we all have. Even though it’s very common it’s often misunderstood, and policy language varies drastically from company to company. One of the most common misconceptions about General Liability is that it covers faulty workmanship, but this is often not covered by a standard policy, pesticide application is usually not covered by a standard policy either. To make it even more confusing many companies use industry standard ISO policy language while some insurance companies write their own policy language that can have more exclusions or sometimes offer better coverage. General liability premiums are often based on gross annual sales and can be audited annually. When shopping for General Liability be sure that the correct classification is being used as there are several different ones and often your sales should be split up into multiple different classifications.
Commercial Auto
Commercial Auto is usually composed of Liability, Uninsured / Underinsured Motorist, Personal Injury Protection or Medical Payments or both depending on the state, Comprehensive, Collision and Roadside / Rental. Liability is probably the most important for a business because it’s the coverage that protects your livelihood and makes the other party whole again in the event of an accident. Do not skimp on this coverage, purchase as much as you can afford and please don’t settle for the state minimum requirements. Personal Injury Protection is usually required in “no fault” states like Florida and pays up to the policy limits for injured parties in the vehicle. Medical Payments is usually an optional coverage, and I recommend carrying at least enough to cover Health Insurance / Workers Comp deductibles. If you have older company vehicles you may consider not carrying Comprehensive or Collision to reduce your cost, most of the time if you have a vehicle that’s worth $4000-$6000 it’s probably better to stash the extra money away in one of your Profit First accounts to replace the vehicle if necessary. Higher deductibles are also a good way to assume part of the risk and reduce your premium. Sometimes having a $2500 or $5000 deductible can pay for itself pretty quickly. Whatever coverages you decide on, be sure your policy covers your vehicles while they are being used in your business, all too often I see people trying to insure businesses use vehicles on a personal auto policy and while sometimes that is ok it’s usually not for any type of landscaping. The exception to this would be using a personal vehicle to drive around and do estimates or check on job sites but even then, it should be listed as business use.
Equipment Coverage
Equipment Coverage is confusingly named Inland Marine and is pretty straight forward. But be sure that your equipment is covered while on the jobsite or stored away from your primary office address as there are “equipment policies” that only cover equipment for use at the business address. The same recommendation goes here for higher deductibles or possibly even not insuring a piece of equipment after it gets older and is not as valuable. Trailers can often be insured on Inland Marine Policies but are often less expensive to insure on the Commercial Auto if possible.
Workers Compensation
Workers Compensation Is often a contractual requirement or many states require it when you meet the employee threshold. While Work Comp can be expensive it’s actually one of the only types of Insurance that you can act to lower over time. A good safety program will go a long way in reducing claims, and a “get back to work” program with light duty requirements can also assist. The goal with Work Comp is to reduce your MOD factor over time reducing your overall premium. There are also monthly reporting Work Comp policies that can better suit many companies that have slow times during the winter months so their premiums drastically reduce when business is slow. Whatever policy you have, do not ignore your annual audit. It will only cause havoc and oftentimes you may have overpaid and will get a refund. Just like General Liability there are multiple classifications that your business may fall under, make sure you are not paying the same rate for clerical office staff as employees out in the field.
The best advice we can offer is to partner with a trusted independent insurance agent—like Barlow Insurance Agency. An independent insurance agent will understand the unique needs of your landscape businesses and can handle the complexities of finding you the right coverage. Let them do the heavy lifting, so you can focus on running and growing your business.
Guest Article by Chris Barlow with Barlow Insurance Agency. Learn more about Chris and his insurance agency by following him on Facebook or reading his Blog.