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What Types of Insurance Does an Appliance Repair Business Need?

What Types of Insurance Does an Appliance Repair Business Need?

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What Types of Insurance Does an Appliance Repair Business Need?

Appliance Repair Business Insurance Quotes

Costs for business insurance can vary greatly, and getting insurance quotes from multiple companies is recommended in order to get the best pricing.

Coverwallet and Hiscox offer easy business insurance quotes at affordable prices.

What Types of Insurance Does an Appliance Repair Business Need?

A broken appliance, such as a dishwasher or washing machine, causes frustrations and disruptions in a customer’s day-to-day life. Often, the high cost of a brand-new appliance compels many to seek out an appliance repair before taking their savings to the store.

Fortunately, appliance repair businesses have skilled technicians that can fix appliances. However, even with skill and training, the business is exposed to several liabilities and losses that can put financial stress on a small business. As a result, appliance repair businesses need various insurance policies to protect them from risks. 

Related: How to start an appliance repair business

What Are Some Risks for an Appliance Repair Business?

Some of the risks that an appliance repair business will encounter include the following incidents:

  • Faulty repairs
  • Car accidents
  • Employee injuries
  • Damage or loss to equipment

Faulty Repairs

Appliance repair shops may run into issues if the completed work is unsuccessful and causes bodily injury or property damage. For example, using defective or broken parts for repairs can lead to machine failure and potential injuries. Further, selling faulty refurbished appliances can lead to injury and damage.

Additionally, fire is a potential hazard that can occur after a faulty repair. For instance, improperly installed parts and wires can cause sparks that can lead to a fire. Since fires can cause injury and property damage, fire risks are a significant hazard for appliance repair businesses. Further, faulty repairs of gas appliances can also lead to damage and injury if the unit explodes or causes a fire. 

Car Accidents

Most appliance repairs likely occur at a customer’s location, especially when the appliance is oversized or heavy (i.e., washing machines). Therefore, appliance repair employees will frequently be driving between job sites, meaning the business has an increased risk of car accidents. 

At-fault car accidents can lead to third-party bodily injury or property damage that the business is financially and legally responsible for. In addition, car accidents put the business’s fleet of vehicles at risk of damage and breakdowns. An incapacitated company vehicle risks an interruption to the flow of business that hinders the business’s ability to make money.

Some of the more common reasons that car accidents occur include 

  • Timeline pressure to meet appointments
  • Distracted driving
  • Driver fatigue
  • Inclement weather
  • Poor visibility
  • Traffic

Employee Injuries

Employees encounter several hazards while repairing appliances. For office workers, the main concern will be slips, trips, and falls that may occur on cluttered or slippery walkways. The technicians who perform the appliance repairs may also suffer injuries from slips and falls; however, they will also encounter other hazards while working at the various job locations. 

For instance, car accident injuries are a primary risk and can lead to severe or lifelong injuries. Additionally, employees working on appliances may suffer back injuries or muscle strains from maneuvering heavy appliances and working in awkward positions.

Appliance repair technicians also use many tools while servicing appliances which can lead to cuts and electrical shocks. Additionally, employees may suffer cuts and crushed limbs from falling or tipped appliances. Electrical shocks and burns may also occur while working with wiring, electricity, and heat-producing appliances.
 

Damage or Loss to Equipment

Because appliance repair technicians move between job sites, their equipment also moves with them. As a result, the equipment has an increased risk of being lost or damaged because it is not kept in a permanent location.

For example, damage or loss can occur due to car accidents, breakage at job sites, misplacement, and theft. In many cases, tools are stolen from parked vehicles or damaged during loading and unloading.

Hiscox.com

What Types of Insurance Should an Appliance Repair Business Consider?

Given the various risks, an appliance repair business should consider several insurance policies to protect from losses and liabilities, such as

  • General liability insurance
  • Commercial auto insurance
  • Workers’ compensation insurance
  • Inland marine insurance 

General Liability Insurance

A general liability policy for products and completed operations covers business owners against claims of bodily injury or property damage that result from a product distributed by the business, due to the business’s finished work, or property damage when on-premises at the customer’s home. 

For example, an appliance repair business may be held responsible for negligence from the injuries or damage caused by faulty refurbished or second-hand appliances that they sell. Similarly, defective appliance repairs that cause injury or damage are the responsibility of the business. Fortunately, a general liability insurance policy can cover these types of claims, protecting the business from bearing the financial burden of paying for the medical bills and property repair costs for liability claims.

In the event of a claim, a general liability policy includes coverage for the following expenses:

  • Third-party medical bills
  • Third-party property damage repairs
  • Legal expenses
  • Settlements

Commercial Auto Insurance

Commercial automobile insurance includes two main types of business insurance coverage: liability insurance and property damage insurance.

First, an auto insurance policy covers liability. Liability claims arising from personal injury resulting from at-fault accidents, such as an accident caused by employees or agents of the business operating a company vehicle or to cover a personal vehicle when being used for business purposes. Fortunately, liability insurance protects the business from these claims.

If an accident occurs, the liability insurance covers the following expenses:

  • Third-party medical payments
  • Third-party property damage repairs
  • Legal fees
  • Settlements

Some additional coverages on a liability policy may include 

  • Uninsured/ underinsured motorist coverage
  • Rental reimbursement
  • Roadside assistance

Second, an automobile insurance policy covers physical damage to business-owned vehicles. Physical damage includes hazards such as collision and non-collision damage. Non-collision-related damage (also called comprehensive coverage) insures perils such as

  • Falling objects
  • Wind or hail
  • Vandalism
  • Malicious mischief
  • Theft
  • Fire
  • Glass Breakage

Workers’ Compensation Insurance

A workers’ compensation insurance policy covers employee injuries, from an electrical shock when repairing a refrigerator to back injury when installing a repaired appliance in the customer’s home. The policy includes coverage for many injury-related expenses, such as the following:

  • Medical expenses
  • Lost wages
  • Ongoing rehabilitation care
  • Disability income
  • Funeral expenses

An employee accumulates many costs following an injury. For example, they may have medical bills and lose income while they are unable to work. This puts the employee in a financial bind and exposes the business to potential lawsuits. However, with workers’ compensation insurance, the employees are protected, and the business is protected from costly liabilities.

Inland Marine Insurance

Although marine implies water, an inland marine policy covers equipment transported over land. An inland marine insurance policy protects mobile equipment, supplies, and inventory with coverage called an equipment floater.

An equipment floater does not limit coverage to a permanent location, so the business’s property is covered wherever it goes. In addition, this policy covers items for perils such as damage, loss, and theft. 

How Much Does Appliance Repair Business Insurance Cost?

Appliance repair insurance costs vary from one business to the next due to their varying levels of risk and coverage limits. For example, premiums for a sole proprietor with no employees and one work vehicle is less risky to an insurance company than a large appliance repair business with many employees and vehicles. For one, the first business doesn’t need workers’ compensation insurance, and the coverage limit on one vehicle will be lower than an auto policy insuring a fleet of vehicles.

Many factors of an appliance repair business influence the cost of insurance, such as 
– The number of vehicles needing insurance
– The value and condition of the vehicles, plus any customization
– The value and condition of mobile equipment 
– The number of employees on the payroll
– Employee training, certification, and driving history
– Any past or current lawsuits or insurance claims

The best way to determine the cost of insurance is to contact an insurance company for a custom quote. Ideally, you may want multiple quotes to compare policies and then pick a policy with the best coverages for a fair price.

What Types of Insurance Does an Appliance Repair Business Need?

What Types of Insurance Does an Appliance Repair Business Need?

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