A cleaning business needs insurance to protect their assets when the unplanned happens. Accidents happen, right? I know you don’t really want to admit it….But they do.
That is why you carry car insurance, health insurance and house insurance. So why would you not get house cleaning business insurance?
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Reason’s why you need house cleaning business insurance
Accidents happen, and when they do you want your business to be prepared and protected. Below are just a few reasons why you need business insurance for your cleaning business.
- You could get into a car accident on the way to a clients home.
- An employee could spill a harsh cleaner on a clients wood floor and ruin it.
- An employee could be stepping on a ladder dusting a high area and fall.
- You could be vacuuming and back up into a table holding a very expensive vase that cost more than your car!
If you don’t carry the right kind of insurance, you could be financially responsible for injury or property damage caused by your cleaning service. It is important that you protect you and your business from the first day that you start a cleaning business.
Here is a list of the different types of insurances you should carry and how they protect your client, your employees and yourself.
What Insurance do I Need for a Small Cleaning Business?
GENERAL LIABILITY INSURANCE
What is liability insurance for a cleaning business?
Business liability insurance is coverage that protects your company’s assets and pays for liabilities incurred because of business operations.
What that means for you as a cleaning business owner is it will cover costs for damage you or your employees caused while cleaning your client’s house, up to the limits of your plan. It will cover the costs if something breaks or is damaged while you are cleaning.
When cleaning multiple homes a day, you and your employees will come across many different surfaces and valuables. Using the wrong cleaning supplies or equipment can damage your client’s property.
You will not want to be in a situation where your business is liable for damage and you can not afford to fix it. You will certainly lose that client. But on top of that, they will tell all of their friends, co-workers, and family members not to use your service.
Your clients will understand that accidents happen. But what will make you more credible and stand out from your competitors is how you handle mistakes. And if you are not properly insured to pay the cost to correct damage to your client’s property you will quickly develop a bad name for your business.
How much is liability insurance for a cleaning business?
According to Insureon, 16% of cleaning businesses pay less than $500 per year on liability insurance, while the majority pay between $500 – $1000 a year. That works out to be an average cost of less than $100 a month.
The factors that go into the cost of insurance for a cleaning business are the size of operations and the amount of coverage you purchase. If you are a small cleaning business or solo cleaner, your liability insurance will be on the lower end of the cost. If you have multiple employees cleaning houses each day, your costs will be on the higher end.
How much liability insurance should I buy for a cleaning business?
In my cleaning business, I purchased a policy limit of $1 million per occurrence and a $2 million aggregate limit. Come to find out, 90% of companies purchase the same limits.
What is bonding insurance for a cleaning business?
Having bonding insurance for a cleaning business will help cover costs for any fraudulent activities like theft, and the insurance company will pay up to the amount of the bond you purchase.
What it means for your cleaning business is that if an employee commits theft inside a client’s home, after a claim gets filed and proven liable, the bonding company will cover the amount of the loss.
Bonding insurance is very standard for the cleaning and janitorial industry. Carrying Bonding Insurance (or being Bonded) will help keep your cleaning business credible and build trust with your clients. It is a great selling point and helps eases the
How do you get bonded for cleaning business?
You will purchase your bonding insurance with the same insurance company that you purchase your liability insurance from. When getting quotes, it is best to get a quote for both liability insurance and bonding insurance.
If you are driving your own car, make sure you contact your current insurance provider. You will want to verify that you are covered for traveling between cleaning jobs. Not all personal car insurance will cover accidents that happen during business operations.
If you are purchasing company cars and having employees driving, you will 100% need to obtain coverage for the vehicle and for your employees. Having business-specific car insurance coverage will help to cover the costs of any damage your business is found to be liable for during a car accident, up to the limits of your plan.
WORKERS COMPENSATION INSURANCE
Workers’ compensation insurance is only needed if you have employees. This insurance will cover the costs of injuries to your employees while they are working.
So now you know what types of insurance is out there for your cleaning business. Here are the reasons why you need liability insurance when you start a cleaning business.
WHY YOUR CLEANING BUSINESS NEEDS INSURANCE
1. Stand out above the other ‘so-called’ cleaning companies
It is so easy to start a cleaning service. Many people will start with the cleaning supplies they have at their home, obtain a client and start cleaning homes.
I have come across more ‘companies’ like this. They are not a ‘REAL’ business… they don’t register a business with their state, they don’t pay taxes (another topic for another day), they take cash under the table, and they don’t carry insurance.
You will prove yourself a credible business when you can say you carry Business Insurance. This leads me to reason #2!
2. Use it as a selling point
I can’t tell you how many contracts we received over other companies because we carried liability insurance. Customers loved hearing that they were protected if we damaged their property or if our employees were dishonest.
You can justify your price point (I hope you are not under bidding your competition, you’ll never profit successfully!) if you have insurance and Susie House Cleaner does not, you will more likely land the job.
As you are growing your client base and meeting new clients (psst… here are some awesome low-cost ways to grow your client base!), they will not know you apart from the next stranger on the street. So telling them that you are insured, can give them peace of mind, build trust and assure them that you are a responsible business owner and can protect their stuff….which leads to point #3
3. Protect yourself
I am sure you started your cleaning business to make money…am I right??? Carrying insurance will help you to protect your assets. If you don’t carry the proper insurance when your cleaning business is liable for damages, you can be held liable. You don’t want to work hard at growing your business just to lose it.
How to Get Insurance for Cleaning Business
Now that I have talked you into getting Insurance for your Cleaning Business you need to go out and get some! Make sure to get 3 insurance quotes for a small cleaning business (just like you would for your car insurance).
Start with your current Car Insurance company.
I recommend starting with your car insurance company. You already have a working relationship with them, and you may even get a discount for carrying both personal and business insurance with them.
Visit a local Insurance broker.
Brokers will reach out to several different insurance agencies to get the best price and coverage for you. The insurance broker will create a package for your cleaning business insurance needs.
When you are carrying different types of insurance and using different agencies, it will be easier to funnel all through one broker. And most of the time they can lower the cost of insurance for your cleaning business.
This has been so helpful, I have your quote sheet and it has helped so so much. Thank you thank you.
Thank you. You are awesome for providing this support.
Awe, thanks LaWanda! You are so very welcome. I wish you the best of luck with your business.
Thanks for the information Roberta, I have a liability policy. I am a solo cleaner, and I am in the process of hiring someone to work with me. It sounds like once I hire an employee I need to get bonded.
Thank you for your help.
Hello Alex, your welcome! Thank you for your comment.
Hello Alex, your welcome!
I have been cleaning for 15+ years..this year I decided to start my own Cleaning business and holy moly! There’s just SO MUCH! LOL Thank you so much you don’t realize it, but you’ve really helped me throughout this process..you’re an angel!!
Wow, what a great article. So many new business owners should read this article as the information is so valuable. Understanding the different types of insurance are sometimes complicate to understand. Thanks for sharing!
Thank you do much! Extremely helpful!