Carpet and Upholstery Cleaning Business Insurance
Getting insurance for your carpet cleaning business is essential.
To ensure the safety of carpet cleaning businesses amidst the various risks that come with the territory, obtaining insurance is crucial. With insurance, these businesses can be protected against property damage and also receive liability coverage for bodily injury or personal harm.
For example, a customer’s carpet may be damaged through an employee’s negligence, as a result of which the customer sues. In a situation like that, insurance would pay for the legal fees to mount a defense, as well as any compensation to the customer.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Carpet and Upholstery Cleaning Business
General liability insurance is — generally speaking — one of the most important insurance policies for carpet cleaning businesses.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
Regardless, your carpet cleaning business may also need protection from other risks. Three common risks that many businesses are exposed to and the policies that cover them are:
- Commercial property coverage: Insurance of this sort will provide funds to repair or replace damaged property, such as cleaning equipment. Many causes of damage, including fire, flood, and burglary, are usually covered.
- Commercial auto insurance: This is a legal requirement that serves a very good purpose. Auto insurance ensures funds are available for repairs and for providing compensation to accident victims.
- Business income coverage: This is coverage that reimburses you for loss of income that results from an interruption of business. If, for example, your business has to shut up shop for a while because some adverse event, such as a fire, has occurred the insurer will cover the loss of income you experience.
When it’s time to acquire business coverage, you will generally be able to choose between the following two types of insurers:
- Traditional brick and mortar insurers: This type of insurer has been in business for decades and tends to have a conservative approach to underwriting. As such, coverage may be costly.
- Online insurers: These providers, like Clearcover and Next, employ recent digital technologies and large datasets to assess risk more precisely, which, coupled with reduced overhead in general, allows them to offer coverage at lower cost.
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Cost of General Liability Insurance
On average, carpet cleaning businesses in America spend between $500 - $1,500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a carpet and upholstery cleaning business to other professional industries using the graph below:
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Common Situations That General Liability Insurance May Cover for a Carpet and Upholstery Cleaning Business
Example 1: Your carpet shampooer malfunctions, shooting water and cleaning fluid all over the home recording studio of a client. His equipment is ruined. Your general liability insurance would likely help to pay for replacing his recording equipment.
Example 2: One of your employees is rushing to finish a cleaning job when he runs into the client, knocking her backward and causing her to hit her head on the corner of a table. She requires medical care for her injuries and asks that you pay for that medical care. Your general liability insurance would likely pay for her treatment.
Example 3: A recent client calls and accuses one of your employees of ruining several of the expensive Persian rugs in her collection. She files a lawsuit against your business for damages. A general liability insurance policy would cover the cost of your legal defense and a settlement if one is required.
Other Types of Coverage Carpet and Upholstery Cleaning Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Professional Liability Insurance
Professional liability insurance is designed specifically for your business needs. As a professional carpet cleaner, there is a possibility that a client could claim you made mistakes that caused him or her injury, financial or otherwise. If he or she were to file a lawsuit against your business, your professional liability insurance would cover the cost of your legal defense.
Commercial Auto Insurance
Your carpet cleaning vehicles should be covered by commercial auto insurance. With a commercial auto policy, you and your employees are protected while driving. If you or an employee causes an accident, the policy will pay for damages to vehicles and medical care for the injured.
Workers’ Compensation Insurance
If you have employees, chances are your state requires you to carry workers’ compensation insurance. If an employee is injured performing job-related duties, the workers’ comp policy you have will pay for his or her medical treatment. It will also pay for some of the wages the employee loses while recovering.
Commercial Property Insurance
All of the equipment and supplies you have invested in would be costly to replace if it were lost in an event like a fire. But with commercial property insurance, you can get help from your insurer to pay for repairs or replacements. As long as the damage was caused by a covered event, you should be able to get financial assistance after you file a claim.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your carpet and upholstery cleaning business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Carpet and Upholstery Cleaning Business Insurance FAQ
Can I buy business insurance online for my carpet and upholstery cleaning business?
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
What is included in a business owner’s policy?
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
What is the difference between business insurance and general liability insurance?
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Do I need insurance before I start a Carpet Cleaning Businesses?
Acquiring business insurance prior to starting your business is crucial. Failing to have coverage from the onset may not only expose your business to unforeseen hazards, but it could also lead to legal infringements.
Certain forms of insurance, such as commercial auto insurance and workers' compensation, are mandatory by law. Additionally, your business may require insurance to safeguard against specific risks such as property damage and personal injury to customers.
Will insurance protect my carpet and upholstery cleaning business from everything?
Not necessarily. Certain exceptions may be written directly into your carpet and upholstery cleaning business insurance policy, and some perils may be entirely uninsurable.
Do I need business insurance if I already have an LLC?
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.