Insurance Is the First Thing a Serious Customer Checks. Here Is How to Start a Florida Contracting Business Right.

A property manager in Lakewood Ranch is choosing between two pressure washers for eleven buildings. Both quoted about the same. One sent a certificate of insurance with the quote, unasked. The other said "yeah, I'm insured" on the phone. You already know who got the contract. That is the whole argument for this article, and I want to walk through it properly, because I see both sides of it every week.

Full disclosure up front: I own Hendrickson Insurance, a Sarasota agency that writes commercial and personal lines, and I build websites and follow-up systems for contractors under DJH & Co. I am not neutral about insurance. I am, however, the person who sees what happens on both ends: the claim after the accident, and the contractor who lost the bid because he could not produce a certificate that afternoon.

What Florida actually requires

Start with the floor, because a lot of new contractors get it wrong in both directions.

Workers' compensation. In Florida, a business in the construction industry with one or more employees has to carry workers' comp. Non-construction businesses hit the requirement at four employees.¹ "Construction industry" is defined broadly and covers most of the trades this site is built for: roofing, painting, plumbing, electrical, HVAC, screen enclosures, landscaping that involves hardscape, and more. Owners can apply for an exemption for themselves in some structures, but the exemption is for the officer or member, not for the people working under them.³ The guy you paid cash to hold the ladder is an employee in the eyes of the state the moment he falls off it.

Liability for licensed trades. If you hold a state contractor license, the Construction Industry Licensing Board requires you to show proof of liability and property damage coverage to get and keep the license.² The minimums are low. They are the price of admission, not a business plan.

Everyone else. If you paint, hang drywall, do handyman work or one of the other trades that no longer needs a local license, nothing forces you to carry general liability. Nothing forces you to have a website either. Both are the difference between a hobby and a business the customer can trust.

What insurance does for your phone

Here is the part the insurance industry never explains well, because it is a marketing point, not a coverage point.

The jobs with real margin are hired by people who are personally on the hook if something goes wrong. Property managers, HOA boards, general contractors subbing out work, commercial landlords, and the retiree in Venice who was burned once. Every one of them asks for a certificate of insurance before they ask for your price, and most of them will not call you back to ask twice. If it is on your website, in your estimate template, and one text away, you are the easy choice. If it is a phone call to your agent and a two-day wait, you are the second choice, which is the same as no choice.

That is why the sites I build put the license number, the insured status and the years in business in the header and the footer, not buried on an about page. It is also why the quote form on those sites can attach the certificate automatically. When we set up your Google Business Profile, "licensed and insured" goes in the description because it is one of the few things a homeowner comparing three map results actually reads.

The coverages, in plain terms

• General liability. The one everyone means when they say "insured." Covers damage you cause to the customer's property and injuries to people who are not your employees. Most residential customers and nearly every commercial one will want to see it. Here is how it is written for Gulf Coast contractors.⁴
• Workers' compensation. Covers your people if they are hurt on the job, and keeps you compliant with the rule above. General contractors will not let an uncovered sub on the site. Workers' comp for Florida trades.
• Commercial auto. Your personal auto policy generally does not cover a truck used for business with a ladder rack and a trailer. Find that out before the accident, not after. Commercial auto.
• Tools and equipment. Inland marine, in insurance language. Covers the tools in the truck when the truck gets broken into, which in this area is a when, not an if.
• A bond, when the job asks for one. Some permits, some municipalities and most public work want a surety bond. Surety bonds explained.
• A business owner's policy bundles liability and property for a small shop and is often the cheapest way to start. What a BOP covers.

If you are already a DJH & Co client, or thinking about it, the insurance page on this site explains how the two businesses fit together. Short version: you can use any agent you like, and you will still get the same website. But if you want one person who understands both the coverage and the marketing, that is what I do.

Getting set up right: the rest of the list

Insurance is the first thing on the list because it is the first thing a customer checks. It is not the whole list. Over the last few years of watching contractors start, grow and sometimes fold in Sarasota, Bradenton and Tampa, the ones that last got these done in roughly this order, usually in the first month.

1. The entity. An LLC or corporation, registered with the state, with its own bank account. Not because it is fancy, but because it separates your house from your business and it is what the insurance, the license and the bank all expect to see.
2. The license, where your trade requires one. State-licensed trades go through the Department of Business and Professional Regulation. If your trade does not require one, get the insurance anyway and put "insured" where the license would have gone.
3. The insurance. Covered above. Get the certificate in a form you can text to anyone in thirty seconds.
4. A CPA who works with contractors. Not a tax preparer in April. Someone who sets up your books so you know your real cost per job, handles the quarterly estimates, and stops you from being surprised by a tax bill after your best year. I can point you to one.
5. An attorney for the paperwork you will reuse for years. A proper contract, a change-order form, and a lien notice that is actually enforceable in Florida. You need these once, done right, not fifty times done wrong. I can point you to one of those too.
6. The phone and the presence. A business number that texts back when you miss a call, a Google Business Profile that names the towns you work, and a website with a page for each service and each area. This is the part I build. Here is why the phone comes first.
7. The review habit. A request after every job, from day one, so that by month six you have the review count that makes the rest of this list visible to the people searching.

Why I bother writing this on a website company's blog

Because the website is the last step, not the first, and I would rather tell you that than sell you one you are not ready for. A beautiful site for a contractor with no entity, no insurance and no books is a beautiful site for a business that will not be here next spring. When someone calls me to talk about a website and it turns out they are three weeks into the business, we usually spend the first call on this list instead. The site can wait a week. The certificate cannot.

If you are starting out in Sarasota, Bradenton, Tampa or anywhere on the Gulf Coast and want to talk through the setup, the insurance, or the site, start here or call. You get me, not a call center, and I will tell you which of these you actually need first.

1. 1. Florida Department of Financial Services, Division of Workers' Compensation: coverage requirements for construction and non-construction employers. https://www.myfloridacfo.com/division/wc/employer/coverage-requirements
2. 2. Florida Department of Business and Professional Regulation, Construction Industry Licensing Board: license requirements, including proof of liability insurance. https://www.myfloridalicense.com/DBPR/construction-industry/
3. 3. Florida Department of Financial Services, Division of Workers' Compensation: exemptions for corporate officers and LLC members. https://www.myfloridacfo.com/division/wc/employer/exemptions
4. 4. Hendrickson Insurance, Sarasota FL: commercial general liability for Gulf Coast contractors. https://hendricksonins.com/commercial-gl.html