As a contractor in Arizona, having proper insurance coverage is crucial for protecting your business, meeting state requirements, and securing contracts. This comprehensive guide breaks down the essential insurance coverages Arizona contractors need, including costs based on our analysis of actual quotes from leading carriers.
Lay the groundwork for success by exploring our guide to general contractors insurance.
General Liability Insurance for Arizona Contractors
General liability insurance protects your contracting business from third-party claims of property damage and bodily injury. Based on our analysis of over 800 contractor quotes, here are the typical costs for Arizona contractors:
| Revenue Size | Average Premium | % of Revenue | Favorable Rate | Potential Savings |
|---|---|---|---|---|
| $500K | $7,000 | 1.4% | $4,200 | 40% |
| $1M | $11,600 | 1.2% | $8,400 | 28% |
| $2.5M | $27,300 | 1.1% | $21,000 | 23% |
These premiums assume:
- Clean claims history (5+ years without incidents)
- Standard $1M/$2M coverage limits
- Typical mix of residential and commercial work
- Approximately 10% subcontractor costs
Worker’s Compensation Insurance for Arizona Contractors
Worker’s compensation insurance is mandatory for Arizona contractors with employees. Based on our analysis, Arizona contractors typically pay around $4,641 per employee annually for workers’ compensation coverage.
Key premium factors include:
- Employee classification codes
- Annual payroll
- Claims history
- Safety programs
- Experience modifier rating (EMR)
For Arizona contractors, typical workers’ compensation costs per $100,000 of payroll average $10,170, which is moderate compared to other states.
Common contractor classification codes and their approximate rates in Arizona:
- Code 5606 (Project Manager/Supervisor): $3-5 per $100 of payroll
- Code 5645 (Residential Construction): $7-11 per $100 of payroll
- Code 5403 (Commercial/Large Projects): $11-15 per $100 of payroll
Additional Business Insurance for Contractors in Arizona
1. Commercial Auto Insurance
- Typical cost: $1,000-$4,000 per vehicle annually
- Required for business-owned vehicles
- Higher limits often needed for larger contractors
- Protects against accidents and damage during business use
2. Tools & Equipment Coverage
- Cost: $1,500-$5,000+ annually for $15k-$50k coverage
- Protects both owned and rented equipment
- Coverage follows equipment to all jobsites
- Includes theft, damage, and vandalism protection
3. Commercial Property Insurance
- Protects offices, storage facilities, and workshops
- Annual premiums: $2,000-$20,000+ based on property value
- Coverage for fire, theft, vandalism, and natural disasters
- Includes business personal property protection
4. Builder’s Risk Insurance
- Premium: 0.15-0.75% of project value
- Covers projects under construction
- Protection against fire, weather, vandalism
- Coverage duration matches project timeline
5. Contractor License Bonds
- Ensures compliance with state regulations
- Required for Arizona contractors
- Typical cost: 1-3% of bond amount
- Premium varies based on credit and experience
Get Arizona Contractor Liability with ContractorNerd
ContractorNerd specializes in making insurance simple and data-driven for Arizona contractors. Our platform offers:
- Instant online quotes from top-rated carriers
- Side-by-side coverage comparisons
- Contractor-specific expertise and guidance
- Streamlined application process
- Ongoing policy management support
- Claims advocacy when needed
Our team of contractor insurance specialists understands Arizona’s unique requirements and can help you:
- Optimize coverage levels based on your specific risks
- Find competitive rates through our carrier network
- Bundle policies for additional savings
- Ensure compliance with state regulations and contract requirements
To get started with tailored quotes for your Arizona contracting business, visit our online quote tool or speak with one of our contractor insurance specialists today.