Snow Removal Businesses Need Insurance

By Megan Cooney, Marketing Assistant

As the colder weather begins to settle in, travel conditions become riskier. Not only for drivers, but for pedestrians as well. Without proper coverage, snow removal businesses, even those that operate as a side business, could find themselves in the middle of an expensive lawsuit.

In July 2010, the Massachusetts Supreme Judicial Court ruled “reasonable care” as the new standard for slip and fall cases relating to snow and ice in Papadopoulos v. Target Corporation. The reasonable care standard is defined as the degree of caution and concern for the safety of others exercised under certain circumstances, such as snow and icy conditions.

Prior to the court ruling, slip and fall cases were reviewed under the Massachusetts Rule, or natural accumulation law. The rule stated that “a property owner is not liable for injuries resulting from the natural accumulation of snow and ice on their property,” according to The American Educational Institute.

To protect your snow removal business from the costly legal expenses of a slip and fall case, you need to invest in the proper insurance coverage.

For some businesses, such as contractors, landscapers, and electricians, snow removal is a way the business can make extra money during the off-season. Adequate coverage for snow plowing can be added onto a business’ regular general liability policy to cover snow removal operations of the business. Keep in mind that any incidents or damage caused by the vehicle while in the course of snowplowing are covered by the auto policy. The auto policy does not provide coverage for incidents that occur after leaving the job.

However, obtaining suitable snow removal coverage is most difficult for individuals who operate strictly as a side business.

“Come winter, a lot of people simply attach a snow plow onto their trucks and go around plowing residential and commercial properties,” said Brenda Dessert, commercial sales representative at McGrath Insurance Group. “They don’t have a general liability policy, and they don’t want to spend $2,000 for coverage with the risk of not making that money back on the investment.”

When plowing for profit, it is in your best interest to be doing so with a commercial plate, even if you have a personal auto policy. According to rule 27 of the Massachusetts Personal Auto Policy (MAIP), a pickup truck or van is eligible for a Massachusetts Auto Policy if the vehicle is individually owned, weighs less than 10,000 pounds, and is not used for delivery.

”Many of the people doing the snow removal do not even realize the extent of their exposure, and that they have no coverage if someone is injured on a driveway or parking lot they were responsible for plowing,” Brenda said. “Their auto policy provides no coverage for this, and legal and potential settlement costs can be incredibly high. A serious injury could end up costing hundreds of thousands of dollars.”

“I had this one contractor who swore up and down that he didn’t need the general liability coverage. During one job his company did for a warehouse, the snow was accidentally pushed too much along the curb, covering up a fire hydrant. Later that day, an accident occurred at the warehouse, and when the firemen showed up, they couldn’t locate the hydrant. … The facility burned down; their insurance company sued, and won. If the contractor had the general liability, he would have been protected.” Irrigation & Green Industry.

Before the first heavy snowfall hits, make sure your policy has sufficient coverage for any claims filed against your snow removal business. To make sure your services comply with the reasonable care standard, ensure your work follows the terms of agreement written into your policy, and be sure to document everything, from how much salt was put down to where the snow was moved.

Following these steps will ensure you and your business are properly insured when you need coverage most.

*This article is written for informational purposes only and should not be construed as providing legal advice.