If you work on electrical systems at residential and commercial job sites, you can face dangerous situations. Running an electrician business means dealing with unique risks because you handle anything from live wires and active circuits all the way to specialized equipment. On top of any issues unique to your business, you can also face other common risks that small business owners deal with, like property damage or losing important documents. Electrician and electrical contractor insurance can help protect your business from these risks. General liability, property insurance and workers compensation policies all may make sense for your business. In addition, you may find that you need additional protections such as commercial auto policies and cyber liability coverages. The licensed commercial agents at Keslar insurance will help you address your most likely risk factors through our relationship with you to allow you to stay focused on running your business!
What are the insurance policies we recommend for Electricians?
Business Owner’s Policy (BOP)
Worker’s Compensation
General Liability
Commercial Auto
Commercial Umbrella
Electrician Insurance – FAQs
1. What types of insurance do electricians need?
Most electricians need:
- General Liability
- Commercial Auto
- Workers’ Compensation (if they have employees)
- Tools & Equipment Coverage (Inland Marine)
- Professional Liability (E&O) for design/build or consulting work
- Optional: Umbrella Liability, Cyber Liability, Bonding
2. Why is General Liability critical for electricians?
Electrical work involves a high risk of property damage or bodily injury. General Liability covers things like wiring that causes a fire or a customer tripping over your cords on-site. It’s often required by both residential and commercial clients.
3. Does my General Liability cover faulty workmanship or incorrect wiring?
Not always. General Liability typically excludes the cost to redo faulty work. However, if your error causes third-party damage (e.g., a short circuit causes a fire), it may be covered. For pure errors or omissions, you’ll want Professional Liability (E&O) coverage.
4. Do electricians need Workers’ Comp if they’re the only worker?
If you’re a sole proprietor with no employees, you may not be legally required to carry Workers’ Comp—but some general contractors and commercial clients won’t hire you without it. And if you use subcontractors, check your state’s laws carefully; misclassification can lead to penalties.
5. What kind of insurance covers my tools and diagnostic equipment?
Inland Marine coverage (also known as a Tools & Equipment policy) protects portable tools, ladders, testers, and other gear—whether they’re in your truck, at a job site, or in storage. Standard property policies usually don’t cover mobile equipment.
6. Do I need insurance for my van or work truck if I already have personal auto insurance?
Yes. Vehicles used for work must be insured under a Commercial Auto policy. Personal auto insurance excludes most business use—especially if the vehicle has signage, carries tools, or transports employees.
7. What is a surety bond and why do electricians need one?
A surety bond is a financial guarantee that you’ll complete a project as agreed. Many towns, states, or contractors require licensed electricians to carry license & permit bonds or performance bonds. It’s not insurance—but it is a trust-builder.
8. Do electricians need Professional Liability insurance?
If you do any design, system layout, panel upgrades, or consulting, then yes. E&O coverage protects you from financial claims due to errors in planning or advice—even if no property damage occurs. More clients are requesting this coverage in contracts.
9. What’s the difference between a small electrician’s policy and one for a larger company?
A solo electrician may need a BOP-style package with liability, tools, and auto coverage. A larger firm likely needs higher liability limits, employee coverage, certificates for subcontractors, and even Cyber or EPLI coverage as they grow.
10. Does my insurance cover work done on commercial buildings or industrial sites?
It can—but you need to disclose your type of work and project size. Not all policies are priced or rated the same for residential vs. commercial, or low-voltage vs. high-voltage work. Make sure your carrier understands your full scope.
11. What limits of liability should I carry as an electrician?
Many electricians carry at least $1 million per occurrence / $2 million aggregate. But larger projects or subcontractor work might require higher limits—achievable with an Umbrella policy that adds extra protection affordably.
12. How can I get better insurance pricing without sacrificing coverage?
- Maintain a clean claims history
- Use written contracts with clear scope of work
- Require Certificates of Insurance from any subs you hire
- Work with an agent who understands the electrical trade and can shop policies built for it (like we do)
