Whether you’re a solo operator with a plow blade on your truck or a larger commercial enterprise, snow plow insurance is a necessary cost for protecting your business. We offer an overview of the basics.
According to the U.S. Federal Highway Administration, more than 70% of the nation’s roads and population are in snowy regions. Annually, more than $2.3 billion is spent by state and local agencies on snow and ice control operations. The U.S. private snow plowing services industry adds another $20 billion, according to IBISWorld, encompassing 87,487 businesses and 176,744 employees. According to SIMA, the industry is highly fragmented with 80% of operations being sole proprietors, and the remaining 20% being larger operators with employees. The top operators control just 1/12th of the industry’s total revenue!
Wherever your business falls – a small seasonal operator with a plow attached to your pickup that services homes and businesses in your neighborhood or an established business with commercial contracts – the hazards are rife. They include extreme weather conditions, dangerous road conditions, and fatigue-inducing, erratic schedules with long hours. Potential exposures include vehicular accidents; stolen or damaged equipment; property damage to others; personal injuries to yourself, your workers, or to pedestrians/drivers; and lawsuits, to name but a few. It’s a business that you need to protect. Insurance is imperative and, generally, some level of coverage is required by law in most states, as is licensure.
Snow Plow Insurance Coverage
Because so many snow plow operators are small, seasonal businesses, they are usually engaged in other seasonal work. One misconception is that an existing small business policy would be sufficient coverage for any seasonal work. Unfortunately, that’s not the case, because the perils of snow plowing are specific and require coverage related to the exposures. Sometimes, existing policies can be supplemented with endorsements or with specialty coverage designed to address snow plowing. For example, NIP Group offers landscaping business insurance packages that can be customized for snow and ice removal operations, too. Find an insurance agent/broker who knows and specializes in snow plow insurance. They will know state licensing and insurance requirements and will help you find the best insurance coverage for your industry that is tailored to your operation’s specific needs. An expert agent can help you to avoid any potentially expensive coverage gaps or exposures.
Here are the primary types of snow plow insurance coverage you should discuss:
Commercial General Liability – a general policy that covers other people besides you or one of your employees. It covers damage to a property or pays for healthcare costs due to an injury or death to a third-party in a non-vehicle related accident, such as a slip and fall involving your customer or a pedestrian. If you have contracts, this coverage is often required.
Commercial Auto Insurance – comprehensive automobile coverage for any vehicles used in your business operations. If you or one of your workers is responsible for a vehicular accident while driving any business-owned vehicle, a commercial auto policy would help pay for damages or injuries to other parties. It’s in your best interest to get more than the minimum requirements to protect your business. Obtain limits as high as you can afford for both liability and comprehensive coverage to your vehicles.
Workers’ Compensation – if your employee is injured while on the job, this would cover medical expenses and temporary wage replacement during recovery.
Inland Marine Insurance – Don’t be fooled by the name of this coverage. If your business’s equipment or tools are damaged, destroyed, or stolen while being moved, inland marine insurance will usually cover those losses. Inland marine policies and coverage can vary substantially from insurer to insurer.
Ask your insurance agent/broker if there are other coverages or endorsements that might be beneficial to your particular operation.
Snow Plowing Insurance Costs
There are many factors that contribute to your snow plowing insurance cost. These include your location, the scope and type of services you provide, the number of vehicles you have, specialized tools and equipment, what types of clients you service, your claims history, your driving history, and the number of workers you employ.
Since some coverages are experience-rated, or based on your prior experience, it is essential to do whatever you can to prevent and mitigate losses.
Here are snow plowing loss prevention tips:
- Establish mandatory best practice safety standards for your operations.
- Train new employees in safety and equipment use. Hold retraining sessions for all staff each season. This Introduction to Snow Removal – Winter Operations Training Series from the Iowa Department of Transportation is an excellent 13-part video series.
- Learn what safety and loss prevention services and trainings are available from your agent/insurer and tap into them.
- Report any accidents with injuries or property damage to your agent/insurer same day, and to state insurance authorities and or police, as required; Report claims for lost, stolen or damaged equipment as soon as feasible.
- Educate your clients and community about driving safely and sharing the road with snowplows. You can often get materials from insurers or state Departments of transportation.
- Join industry associations such as the Accredited Snow Contractors Association (ASCA) and the Snow & Ice Management Association (SIMA) to keep up on trends, issues, new legislation.
- Enlist the services of an attorney to develop snow removal contracts specifying work to be performed and fees.
- Visit client worksites/ home properties preseason or prior to a snowfall to scope out the property surface conditions and to note any obstacles or hazards.
- Document work performed with photos, videos, and notes to log the date, location, services performed, start and completion times, and any notes about conditions or problems. Make this a standard operating procedure.
Remember, the least costly accidents and claims are the ones that never happen. Safety and loss mitigation are worth the effort!