About half of NRCA members are preparing to renew their insurance policies this month—a task most face with the same amount of glee as, say, doing punch-list work for the average general contractor.
For a typical roofing contractor, insurance is the third-largest item in the operating budget—right behind labor and materials. According to NRCA financial management surveys, insurance of all kinds accounts for an average of 7 percent of a roofing contractor's total expenses. (By comparison, NRCA's insurance costs account for about 8/10 of 1 percent of its budget.)
Unfortunately, many NRCA members will have trouble getting a quote this year, especially if they do business in New York or California, do a lot of residential work or have a history of losses. And being in the roofing contracting business without insurance is like going to a nude beach without sunscreen: There are just too many bad things that can happen.
So roofing contractors must approach buying insurance the same way they expect building owners to buy a roof. That is to say, value matters. The lowest-priced commodity product isn't always the best. The history and reputation of the company being considered are important. And an insurance purchase should be part of a long-term relationship rather than a one-time deal.