Roofing is a high-risk business, and ensuring you have the right insurance coverage is essential for protecting your business, employees, and clients. Arizona roofers must comply with state regulations and safeguard their operations from potential lawsuits, property damage, and liability claims. This comprehensive guide covers all the essential insurance policies Arizona roofing contractors need.
Essential Insurance Coverage for Arizona Roofers
1. General Liability Insurance
General liability insurance is the foundation of protection for roofing contractors. It covers:
- Bodily injury – If a third party (e.g., a homeowner) gets injured on the job site.
- Property damage – If your work results in accidental damage to a client’s home or business.
- Personal and advertising injury – Covers claims like defamation or copyright infringement.
Recommended Coverage Limits for Arizona Roofers:
- $2 million general aggregate limit
- $1 million products-completed operations limit
- $1 million personal and advertising injury limit
- $50,000 damage to rented premises limit
- $1 million each occurrence limit
Many commercial projects may require higher coverage limits, sometimes up to $5 million through an umbrella policy.
2. Workers’ Compensation Insurance (Mandatory in Arizona)
Arizona law requires all businesses with at least one employee to carry workers’ compensation insurance. This covers:
- Medical expenses for work-related injuries
- Lost wages during recovery
- Rehabilitation costs
Key Points:
- Employers cannot pass the cost of workers’ comp onto employees.
- Failure to provide workers’ comp can result in fines, penalties, and legal action.
- The cost typically ranges up to 8.87% of roofing labor costs, with a minimum policy cost of $1,250.
3. Commercial Auto Insurance
If you use vehicles for business (e.g., transporting materials, traveling between job sites), commercial auto insurance is essential. It covers:
- Damage to your work vehicles
- Liability for accidents involving your vehicles
- Injuries caused to others while driving for work
Important:
- Personal auto insurance does NOT cover business-related driving.
- Consider adding comprehensive and collision coverage for extra protection.
4. Umbrella Insurance (Extra Protection for Large Claims)
Why do you need it? Roofing accidents can lead to costly lawsuits. If a claim exceeds your general liability limits, umbrella insurance provides additional coverage.
- Protects against catastrophic losses
- Covers bodily injury, property damage, and personal injury claims
- Helps prevent financial ruin from lawsuits
5. Inland Marine Insurance (Protecting Equipment in Transit)
Roofing businesses frequently transport tools, materials, and supplies between job sites. Inland marine insurance covers:
- Equipment and materials in transit
- Property stored off-site
- Items displayed at trade shows
6. Equipment Coverage (Protecting Your Tools & Gear)
Roofing tools and equipment are costly investments. This insurance protects against:
- Theft of tools from job sites or vehicles
- Damage from accidents or weather
- Loss due to unforeseen circumstances
Typical Cost: Around $500 per year for $10,000 of tool coverage.
7. Builder’s Risk Insurance (Coverage for Construction Projects)
For roofers working on new construction or major renovations, this insurance covers:
- Fire, hail, theft, and vandalism
- Vehicle collisions with structures under construction
- Material losses during the construction period
Important:
- Coverage ends when the project is complete.
- Does not cover employee injuries (workers’ comp is required).
8. Drone Coverage (For Roof Inspections & Aerial Work)
If you use drones for roof inspections, be aware that general liability insurance typically excludes drone-related damages. You may need a separate drone insurance policy to cover:
- Damage to the drone itself
- Liability for drone-related accidents
Additional Considerations for Arizona Roofers
Contractor License Bonds (State Requirement)
Arizona requires contractor license bonds based on your project type and size:
| Contractor Type | Bond Amount (Based on Gross Volume) |
|---|---|
| Residential General Contractors | $9,000 (< $750K) / $15,000 (> $750K) |
| Residential Specialty Contractors | $4,250 (< $375K) / $7,500 (> $375K) |
| Commercial General Contractors | $5,000 (< $150K) / $15,000 ($150K–$500K) / $25,000 ($500K–$1M) |
Completed Operations Coverage (Protecting Past Work from Future Claims)
Even after a project is finished, problems may arise (e.g., a roof collapsing due to improper installation). Completed operations coverage ensures protection against such claims.
Key Considerations:
- This is typically included in general liability insurance.
- Covers bodily injury or property damage caused by work after completion.
- Does NOT cover damage to your own work (e.g., fixing a bad installation).
How to Ensure You Have the Right Coverage
- Review Your Policy Carefully:
- Check limits, exclusions, and deductibles.
- Avoid policies with subcontractor exclusions if you use subcontractors.
- Work with a Roofing Insurance Specialist:
- Not all insurance agents understand the roofing industry.
- Find an agent experienced in contractor insurance to ensure your business is fully covered.
- Consider Your Business Type:
- Residential vs. commercial projects may have different insurance needs.
- Commercial jobs often require higher coverage limits (up to $5M).
- Regularly Update Your Coverage:
- As your business grows, increase policy limits to match higher risk exposure.
Final Thoughts: Protecting Your Roofing Business in Arizona
Insurance is not just a legal requirement—it’s a critical safeguard for your roofing business. With the right policies in place, you can:
- Protect yourself from financial losses
- Ensure compliance with Arizona regulations
- Safeguard your employees, tools, and projects
Take Action Today: Consult with an experienced insurance agent to customize your policy and ensure full protection for your Arizona roofing business.
Would you like help finding an insurance provider or customizing a policy that fits your roofing business needs? Let me know!
