Running a successful plumbing company in Wisconsin requires more than just technical expertise in pipefitting, drainage and water systems. It also means implementing smart risk management practices to safeguard your business from unforeseen liabilities. After all, it takes years to build a reputation for quality work and customer service—but just one accident or lawsuit to undo all that hard work.

The right insurance coverage serves as a crucial shield against potential risks that could sink your plumbing business. This comprehensive guide provides Wisconsin plumbers an in-depth look at key insurance policies needed to protect their livelihood. We’ll explore how factors like location, services offered, and number of employees influence premium costs. You’ll learn how insurance needs grow and change as your business expands. We’ll also demystify how insurers use proprietary formulas to calculate your rates.

Most importantly, you’ll understand why partnering with an insurance advisor who knows the plumbing trade is essential. Their expertise ensures you get tailored coverage at the best value, without gaps or paying for unneeded policies. With proper safeguards in place, you can focus on delivering outstanding service and growing your customer base.

For plumbers in Wisconsin, having the right insurance protection for their plumbing business is essential. This usually includes general liability protection for plumbers to protect against third-party claims and workers’ compensation coverage for plumbing businesses to cover employee injuries on the job.

Key Factors Influencing Insurance Costs

While each plumbing business faces unique risks, there are common characteristics insurers use to determine premiums across all policies:

Location – Your rates are partially based on operating in certain Wisconsin cities and counties. Areas prone to more natural disasters, crime or lawsuits can increase insurance costs. Local regulations also impact pricing.

Claims History – Too many past claims will cause your premiums to rise over time. Maintaining a clean claims record keeps your insurance affordable.

Work Performed – Specialized or high-risk plumbing work often results in higher premiums due to greater hazards. For example, sewer line repair is riskier than sink installation.

Revenue – More revenue means you likely take on bigger jobs. Higher liability limits and coverage amounts help offset increased exposures.

Employees – Additional employees increase the chance of workplace injuries and other claims. Workers’ comp and other policies become more expensive as payroll grows.

Business Structure – Sole proprietors face different risks than incorporated entities, which drives pricing differences.

Carefully evaluating how these characteristics apply to your business is crucial when shopping for plumber insurance in Wisconsin. This allows you to secure suitable coverage at a competitive rate. Never go with the cheapest policy, as you often get what you pay for when it comes to insurance.

Small Plumbing Business Insurance Costs

Typical small plumber profile:

  • 1 owner, 1-2 employees
  • Up to $150K annual revenue

When starting out, securing proper insurance is critical, but cost is also a major concern. Here are the key coverages needed for new plumbing businesses:

General Liability Insurance – This fundamental policy protects your business when third-party bodily injury or property damage claims arise from your plumbing operations. For small plumbing companies in Wisconsin, expect to pay general liability premiums ranging from $4,100 to $10,800 annually.

Workers’ Compensation – If employees are injured on the job, this insurance pays for their medical treatment and lost wages while they recover. Premium costs vary based on payroll size. Small plumbing businesses typically pay $2,948 to $5,158 per year.

Surety Bonds – Most states require plumbing contractors to carry license and permit bonds to operate. Typical bond amounts are $5,000 to $25,000, which cost $50 to $250 per year. To learn more about the necessary steps and prerequisites, check out our informative article on obtaining a Wisconsin plumbing license.

Commercial Auto Insurance – This covers vehicles used for business purposes in the event of accidents. For plumbers, expect to spend $1,500 to $3,500 annually per vehicle.

Tools & Equipment Insurance – Also called inland marine, this policy protects your tools and gear while on job sites or in transit. Usually costs small plumbing businesses around $250 to $750 per year.

Cyber Liability Insurance – With increased digitization, a cyber policy protects against data breaches and loss of sensitive customer information stored electronically. Typically costs between $750 and $1,500 annually.

Business Owner’s Policy (BOP) – A BOP bundles general liability, property damage and other common coverages together into one cheaper policy, saving 10-15%.

Medium Plumbing Business Insurance Costs

Typical medium plumber profile:

  • 1 owner, 3-5 employees
  • $500K in annual revenue

As plumbing companies grow, they take on more risk exposure. Here are key coverages needed at the medium size:

Commercial Property Insurance – This protects your office building, warehouse, and other company-owned properties against damage from fires, storms, theft and other hazards. Average cost for plumbers is $500 to $2,000+ per year.

Umbrella Insurance – Also called excess liability, this provides additional liability coverage above and beyond the limits of your other policies. Umbrella coverage usually starts at $1 million for plumbers, costing around $400 to $800 annually.

Errors & Omissions Insurance – Also called professional liability, this policy protects against financial loss arising from alleged mistakes or negligence in your professional work. Common for medium-sized plumbing businesses, averaging $500 to $1,000 per year.

Employment Practices Liability – This covers legal claims around wrongful termination, discrimination, sexual harassment and other employment issues. Typical costs range from $800 to $1,200 annually for plumbers.

For a plumbing company with 3 employees and $500K in revenue, general liability premiums often range from $12,500 to $23,800. Workers’ compensation costs typically fall between $8,843 and $15,475, calculated based on payroll. Surety bonds still average just $50 to $250 per year.

Large Plumbing Business Insurance Costs

Typical large plumber profile:

  • 1-2 owners, 4-5 employees
  • $1M+ in annual revenue

As plumbing contractors grow to large sizes, insurance programs must expand as well:

Higher Liability Limits – Larger plumbing businesses require more protection, usually $2 million per occurrence and $4 million aggregate limits. Expect total liability premiums above $50,000 annually.

Workers’ Compensation – With more employees, payroll-based workers’ comp premiums often exceed $25,000 per year.

Commercial Property Insurance – Insuring higher value buildings and contents requires more coverage, over $5,000 annually.

Fleet Insurance – Larger fleets of 10+ vehicles can cost over $15,000 per year to insure.

Umbrella Insurance – Extra liability limits above $5 million help cover higher risk exposures. Annual premiums range from $2,500 to $5,000+ per $1 million in additional coverage.

Employment Practices Liability – Larger plumbing companies need EPLI limits up to $1 million to match increased litigation risks. Typical premiums rise to $1,500+ annually.

Errors & Omissions – Larger plumbing contractors may benefit from higher E&O limits, costing over $1,500 per year.

Cyber Liability – With more employees and customers, larger firms have more digital assets at risk, necessitating robust cyber insurance.

Pollution Liability – Environmental risks grow along with the business, making pollution liability coverage more essential.

Additional Insurance Coverages

Depending on your specific risks, consider adding these supplementary insurance options:

Builder’s Risk Insurance – This specialized policy insures construction projects against damage during the building phase.

Inland Marine Insurance – This covers tools, equipment and mobile machinery that are often moved between job sites.

Business Interruption Insurance – Replaces income lost when accidents, natural disasters or other events halt operations.

Commercial Crime Insurance – Protects against employee theft, forgery, computer fraud, counterfeiting and other crimes.

Product Liability Insurance – Covers injuries or damage caused by products you sell or install for customers.

Mechanical Breakdown Insurance – Pays to repair or replace mechanical equipment when it fails due to problems like corrosion.

How Insurers Determine Plumber Premiums

Insurance companies use various proprietary criteria to calculate premiums for plumbers beyond just business size and revenue. Here are key factors that influence rates for different policies:

General Liability Insurance – Affected by the types of plumbing services provided, history of claims and lawsuits, safety record, use of subcontractors, and geographic location.

Workers’ Compensation – Class code, experience modification factor and total payroll amount primarily determine premium costs. Rates heavily depend on the state.

Commercial Auto Insurance – Rates depend on the number and types of vehicles, driver accident histories, chosen coverage limits, and state minimum requirements.

Property Insurance – Construction type, security systems, fire protection, catastrophe exposure and location are key rating factors. Discounts may apply for builder code compliance.

Umbrella Insurance – Pricing is mostly based on limits and claims history of underlying liability policies that it sits above. More required limits mean higher umbrella premiums.

Surety Bonds – Credit score, license types, contractual obligations and the requested bond amount largely drive premium costs. Favorable credit lowers rates.

Cyber Insurance – Factors include amount of sensitive data stored, revenue, security protocols, dependence on computer systems and previous breaches.

Employment Practices Liability – Rates depend on number of employees, handbook & HR practices, previous claims, revenue and industry risk factors.

By understanding exactly how insurers calculate plumber premiums, you can make smart insurance buying decisions and potentially lower your costs.

Getting the Right Insurance for Your Plumbing Business

Purchasing insurance is extremely complicated, especially when sorting through general liability, E&O, cyber, workers’ comp and the many other policies required to properly cover a plumbing business. Generic agents unfamiliar with the trade often recommend inadequate or ill-fitting coverage.

However, partnering with an insurance advisor who specializes in plumbing contractors is crucial to building a tailored and cost-effective program.

Here are key benefits of using a plumbing insurance specialist:

  • Package Policies – Bundles general liability, auto, umbrella and other coverages together into one cheaper policy.
  • Proprietary Products – Specialized coverages and enhanced protection for unique plumbing risks.
  • Preferred Rates – Discounted premiums only accessible through select insurance carriers.
  • Contract Review – Ensures your contracts don’t unintentionally jeopardize insurance coverage.
  • Claims Advocacy – Helps effectively prepare, document and settle claims.
  • Risk Management – Identifies safety improvements to reduce hazards and lower insurance costs.
  • Annual Coverage Reviews – Revisits policies to ensure adequate protection as your business evolves.
  • Consolidated Invoicing – One invoice for all policies simplifies payment and management of insurance program.

This level of expertise allows a plumbing insurance specialist to maximize value and minimize gaps in coverage. Don’t take chances with generic policies from standard agents with no trade experience. Partner with a trusted advisor to make sure you get specialized coverages at the best price.


Operating a plumbing company without proper insurance exposes your business to significant financial risk from a single accident, lawsuit or disaster. Use this guide to understand essential coverages, how premiums are calculated, and evolving insurance needs at different stages of growth. We encourage you to work closely with an insurance advisor who knows the plumbing trade to implement a smart risk management plan for your Wisconsin plumbing business. Their expertise ensures you get tailored protection so you can focus on what matters most – delivering outstanding service to your valued customers.