Contractors and their work are vital to the nation’s economy. In 2024, the construction industry contributed approximately $2.2 trillion—around 4.5% of the nation’s GDP. With over 8.2 million employees, the sector is essential for job creation and economic growth.
In the Northeast, where infrastructure projects, urban development, and historic renovations are common, construction plays an even more vital role. But with great opportunity comes significant risk. Contractors in the Northeast face unique challenges that can disrupt project timelines and budgets.
Having builder’s insurance is more than just a formality—it’s essential for protecting your business. The right coverage doesn’t just help you bounce back from financial setbacks; it keeps your projects on track and helps you build trust with clients and investors.
Protecting your business isn’t just about covering losses—it’s also about being proactive. Taking steps to minimize risks can lower premiums and prevent costly claims for contractors. That’s where strong loss control strategies come in.
By understanding these risks and having the right support to build a loss control program, contractors in the Northeast can protect their businesses, reduce costs, and keep projects running smoothly—no matter what challenges arise.
In this blog, we’ll explore essential coverages every Northeast contractor should consider and loss control tips to lower costs and minimize risks.
Keep reading to discover expert insights from Construction Underwriting Specialist Brian Shaffer and Loss Control Construction Specialist Shawn Gentry at Central Insurance.
What Factors Do Underwriters Prioritize When Evaluating Builders Insurance in the Northeast?
Insurance companies aren’t just looking at your business size or project scope—they’re digging deep into your loss history, job site risks, and safety practices to determine coverage and pricing.
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The #1 Factor: Your Loss History
Underwriters start by reviewing your past claims. According to Shaffer, “Loss history is going to be your biggest indicator for pricing, along with your exposures.” If your company has frequent or severe claims, expect higher premiums—or, in some cases, difficulty securing coverage.
Jobsite Safety and Supervision
Construction sites are high-risk environments, and how you manage safety plays a significant role in insurance costs. “Are there boots on the ground at the project? How good is the supervision? Are they qualifying their subcontractors? It all goes back to quality control,” Shaffer says.
A formal safety program, documented procedures, and regular training sessions will make your business more insurable—and lower your premiums over time.
Learn More: Loss Control Tips for Construction Companies
Auto Fleet Risk: A Growing Concern
Surprisingly, one of the biggest insurance concerns isn’t on the job site—it’s on the road. “Auto claims are the biggest thing we’re working on right now, especially with distracted driving,” says Shaffer. With traffic congestion in the Northeast, contractors with large vehicle fleets are at higher risk.
Investing in fleet safety programs, telematics, and ongoing driver monitoring can help prevent accidents and improve insurability.
Learn more: Protecting Your Drivers and Vehicles, No Matter the Size
Essential Coverages for Northeast Contractors
While every contractor’s needs are different, Shaffer outlines a few key coverages that all contractors should consider:
1. General Liability Insurance: This is your first line of defense, covering bodily injury, property damage, and legal costs if a third party sues you.
2. Workers’ Compensation: Required in almost every state, this coverage protects your employees if they get injured on the job.
3. Builder’s Risk Insurance: Covers damage to a structure under construction—whether from fire, theft, vandalism, or extreme weather.
4. Commercial Auto Insurance: If you have company vehicles, this is a must-have, especially with increased distracted driving risks. Learn how to choose the right auto commercial policy.
5. Umbrella/Excess Liability Coverage: “With today’s nuclear verdicts, $1 million or $2 million general liability limits aren’t enough,” warns Shaffer. An umbrella policy adds extra protection in case of large claims.
6. Pollution Liability Insurance: Many contractors don’t realize they have pollution exposure, but even basic work like remodeling can cause environmental hazards. Learn if pollution liability is right for you.
7. Professional Liability (E&O): This covers errors in professional services that lead to financial losses for design-build contractors or project managers.
8. Railroad Protective Liability: This specialized coverage is required if you work near railroads.
9. Contractual Risk Transfer Protection: Shaffer stresses the importance of having an attorney review your contracts to ensure proper risk transfer. If a subcontractor makes a mistake that leads to a claim, you don’t want your company on the hook.
Unique Risks for Northeast Contractors and How to Minimize Them
The Northeast presents unique challenges that contractors in other parts of the country don’t have to think about as much. Here are some major risks—and how to protect against them:
| Congested Worksites | |
| Urban jobsites mean less room to work, more foot traffic, and higher risks of third-party injuries. Tight spaces also make accidents involving heavy equipment more likely. | Solution: Require subcontractors to have proper insurance, install safety barriers, and train workers on tight-space maneuvering. |
| Historic Renovations and Structural Risks | |
| Many Northeast projects involve renovating old buildings, which can uncover hidden problems like weak foundations or hazardous materials. | Solution: Builder’s Risk and pollution liability insurance can help cover unexpected issues. |
| Auto Accidents and Distracted Driving | |
| Contractors’ fleet vehicles are at greater risk with high population density in Northeast cities and winter storms. Additionally, distractions while driving have become more prevalent than ever. Phones, food, drinks, and even the interior tech of a vehicle itself can all cause distractions leading to accidents. | Motor Vehicle Record (MVR) monitoring, driver training, and telematics help mitigate this risk. Additionally, keep vehicles on a consistent maintenance schedule to ensure they can handle roads after a storm. |
| Winter Storms and Nor’easters | |
| Snow, ice, and freezing temperatures can cause slip-and-fall accidents, project delays, and material damage. | Keep heating and dehumidifying equipment on-site to prevent water damage and invest in proper site drainage. |
How Loss Control Can Lower Your Insurance Costs
Want lower insurance premiums? Avoiding claims is key. Loss control strategies help reduce the frequency and severity of claims, making your business more attractive to insurers.
Shawn Gentry explains “The more controls in place, the more opportunity to keep costs down.” Here’s how:
- Fleet Safety Programs: Monitor drivers, remove risky ones, and install telematics.
- Subcontractor Qualification: Make sure your subcontractors carry adequate insurance.
- Regular Safety Audits: Identify and fix hazards before they cause claims.
- Incident Documentation: Keep detailed records of accidents and near-misses.
- Strong Claims Management: Have a dedicated person who handles claims before they escalate.
Shaffer sums it up: “Well-controlled accounts get better pricing than those that lack safety measures.”
The Central Difference
Not all insurers truly understand the challenges of the construction industry. At Central Insurance, the focus isn’t just on policies—it’s on building strong relationships with contractors and providing real, hands-on support when it matters most.
“We don’t want to be just a name on paper; we want insureds to know their underwriter and loss control rep—not just call a 1-800 number.” – Shawn Gentry
Many insurance providers take a transactional approach, but Central takes the time to understand the nuances of each contractor’s business. Whether it’s offering risk management guidance, helping navigate a complex claim, or proactively working to prevent issues before they arise, the goal is to be a trusted partner—not just an insurance provider.
Learn More: Construction Underwriting at Central
With a team that specializes in construction, Central Insurance brings deep industry knowledge, proactive risk assessment, and a commitment to customer success. They believe that the best insurance isn’t just about coverage—it’s about helping contractors operate more safely, efficiently, and confidently.
When you work with Central, you’re not just getting an insurer. You’re gaining a team that’s invested in your long-term success, ready to offer real solutions, and always just a call away.
Connect with Central Insurance today and experience the difference a true partner can make.
The information above is of a general nature and your policy and coverages provided may differ from the examples provided. Please read your policy in its entirety to determine your actual coverage available.
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