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What is electrician insurance?

Electricians face numerous professional risks. From troubleshooting electronic systems to repairing circuit breakers, every task is about navigating dangers that can lead to personal injury or property damage. To help protect you and your business, there's electrician insurance.

Electrician insurance is a term used to describe the combination of insurance policies that are designed to protect electricians from liability claims, negligence claims, property damage and lost or stolen equipment.

Who needs electrician insurance?

Electrician insurance is a must for anyone in the electrical industry due to the high-risk nature of the job. This includes:

Freelance Electricians: Those who work independently, taking on a variety of projects.

Contract Electricians: Electricians who work on a contract basis for different clients or companies.

Specialized electricians: From industrial, to commercial, to residential, specializing in a specific area will require more coverage, especially when working with high voltage, low voltage, lighting, fiber optics or electrical controls.

Consultant Electricians: Professionals offering expert advice and electrical planning services for residential and commercial buildings.

Businesses offering electrical services: Any business offering electrical as part of their services should have insurance to protect against liabilities.

What does electrician insurance cover?

Electrician insurance typically includes these three types of coverage:

Professional liability insurance: This is also known as errors and omissions (E&O) insurance and protects against claims of professional mistakes or negligence. For instance, if you ignore basic safety standards when wiring a building and the work results in a fire, professional liability insurance will cover the related costs.

Commercial general liability insurance (CGL): Essential for all electricians, this insurance provides financial protection against lawsuits for third-party property damage or bodily injury. If, for example, your work results in a resident receiving an electric shock, your CGL protection will cover any legal fees you may need to pay, as well as the compensation received by the injured party.

*Do note that CGL does not cover employees who are injured on the job, only third parties who are not part of your company. Employees will be covered by your province’s workers’ compensation board, which provides insurance and is mandatory in every province.*

Tools and equipment insurance Also known as electrician equipment insurance, this covers the repair or replacement costs if your tools or equipment are lost, stolen or damaged.

*This does not cover your tools and equipment from natural wear and tear such as natural deterioration, corrosion, rust, and mechanical breakdown over time. *

What insurance add-ons are recommended for electricians?

Commercial property insurance: This coverage guards electricians from financial losses derived from damages to their own buildings and equipment, which includes tools and machinery vital to basic operations. If, for example, there is a burglary at your shop, this coverage will help pay for damages to the building, as well as any stolen items.

Commercial auto insurance: This coverage is mandatory if you use a vehicle for business operations. As an example, if you drive a vehicle to job sites, you'll need to add commercial protection to your vehicle, even if it's already covered by your personal insurance. Lacking commercial auto protection on a vehicle that is used for business can lead to claims being denied.

Business interruption insurance: This coverage compensates electricians when operations are disrupted, reduced or outright prevented by circumstances outside of your control. It also helps cover expenses necessary to resume operations and minimize lost revenue.

How much does electrician insurance cost in Canada?

The cost of electrician insurance in Canada can vary depending on several factors, including the type of coverage, the size of the business and the company’s claims history. On average, contractor electricians and small businesses can expect to pay between $1,000 to $3,000 per year. Larger businesses will likely pay more.

Keep in mind that this range will not be relevant to all electricians in Canada. To get an accurate estimate of the cost of insurance for your own business, you'll need to get a quote that applies specifically to you.

What factors determine the cost of electrician insurance rates?

Several factors can influence the price of electrician insurance in Canada:

• Geographic location: Premiums are impacted by your area of operation. Environmental threats and the probability of theft or damage to property can both cause an electrician's business insurance to rise.
• Revenue: Insurance companies will usually charge more to cover businesses with higher revenue. This is because payouts for things like business interruption claims will be higher.
• Number of employees: Having more employees means more potential claims. As a result, insurance providers will charge a higher premium to cover a company with multiple employees than they will for a sole proprietor.
• Tools and equipment: The value of the assets an electrician wishes to insure will have an impact on their premiums. The greater the replacement cost, the more the premiums will increase.
• Claims record: Insurance companies use past behaviour to predict future behaviour. Therefore, an electrician with a history of making frequent claims will pay more for insurance than an electrician who's never had an issue in the past.
• Specific risks: Unique risks, such as working with high-voltage systems, can also influence costs.

How does electrician insurance work?

When you file a claim, your insurer assesses the situation, and if it’s covered, reimburses you for the costs up to the policy’s limits. This helps you manage losses and keep your business running efficiently.

How do I get the cheapest electrician insurance quote?

Here are a few tips to help you get affordable electrician insurance:

• Get quotes: Comparing the market is the surest way to get the best price on electrician insurance. Check out what different insurance providers charge for coverage to ensure you wind up with the cheapest policy.
• Maintain safety standards: Electricians deal with more day-to-day hazards than most, which means claims may be made more frequently. By adhering to strict safety standards, you can reduce the likelihood of having to make a claim, which will help keep premiums down in the long term.
• Choose deductibles wisely: Opting for a higher deductible will help minimize your premiums, but it will also mean you have to pay more when a claim is filed.