Plumber insurance: leaks after you leave and what covers them

When a supply line you installed lets go days or weeks after the job and soaks a client’s floors, the claim usually goes to your general liability policy under its products-completed operationsProducts-completed operationsProducts-completed operations is the part of general liability that covers injuries or damage caused by your finished work, or products you sold, after the job is done.Read the definition coverage, which typically pays for the damage the water does to other property and for your defense, subject to the policy’s terms and limits. What it usually won’t pay for is the fitting itself, or the labor to redo your own work, and it only helps if a policy is in force when the damage happens. Those two limits explain most of the surprises.

This is written for plumbing contractors and solo plumbers, the “Plumber” business type you can start a quote with, who also carry workers’ comp for a crew and tools and equipment coverage for the gear in the van, and for the policies most trades carry, see insurance for contractors.

The leak that shows up after you’ve been paid

Say you replace a water heater and the supply connections on a Friday, the homeowner pays, and by Monday morning a compression fitting you didn’t fully snug has been weeping all weekend. By then the water has run under the laminate, into the subfloor and through the ceiling of the finished basement below. Nobody was there. You’re long gone. That’s what completed operations means in practice: your work is finished, you’ve left the site, and the damage comes later.

What general liability pays, and what it won’t

Read this before your first callback. Standard general liability forms are written around a simple idea: the policy covers damage your work causes to other people’s property, and it doesn’t act as a warranty on the work. The language that does this is usually called the “your work” exclusion, and read plainly, it takes the cost of repairing or replacing your own faulty work off the table, while leaving in place coverage for the drywall, flooring, cabinets and furniture that your faulty work damaged.

That split is clean on paper. But in a real claim it gets messier, because plumbing hides inside walls. If an adjuster has to decide whether cutting open a finished wall to reach your joint is part of repairing your work or part of repairing the damage, the answer depends on the policy wording, the facts and sometimes your state’s case law, and reasonable people disagree. There’s another wrinkle that matters for shops that hire out: many standard forms carve an exception into the “your work” exclusion when the faulty work was done for you by a subcontractor, which can change the answer for a plumbing contractor who subs out part of a job. So ask your underwriter how your policy treats tear-out, the cost of opening finished walls and floors to reach your joint, because that line is where these claims usually get argued.

Our view: general liability is there for the flood. The fitting is yours. If you price jobs as if the insurer will cover callbacks and redo work, you’ve priced them wrong, and the better protection for that risk is careful work, pressure tests and photos.

Your finished work outlives your policy

This is where plumbers who retire, switch insurers or take a slow winter off get caught.

Most general liability for small contractors is written as an occurrence policyOccurrence policyAn occurrence policy covers injury or damage that happens during the policy period, even if the claim is filed after the policy has ended.Read the definition, which pays for damage that happens while the policy is in force, regardless of when the claim is filed. That sounds generous, and it is, as long as you stay insured. It also means the policy that matters for a leak is the one in force on the day the leak causes damage, not the one you had on the day you did the job. Close the business and cancel the policy in December, and a joint you made in October that fails in March may have no policy behind it at all. Let the policy lapse for two weeks between insurers, and any damage that happens in those two weeks falls in the same hole, however old the job that caused it.

So keep coverage continuous, line up any new policy to start the day the old one ends, and if you’re winding down for good, read occurrence vs. claims-made policies and ask an insurer about coverage for completed work from discontinued operations before you cancel.

What general contractors put in a plumbing subcontract

If you sub for GCs, the insurance exhibit will usually look something like this:

1. General liability at stated per-occurrence and aggregate limits, often with a separate products-completed operations aggregate.
2. The GC, and often the property owner, named as an additional insuredAdditional insuredAn additional insured is a person or company, such as a landlord or client, added to your liability policy so it can protect them from claims tied to your work.Read the definition for both ongoing and completed operations.
3. Your coverage written as primary and noncontributoryPrimary and noncontributoryPrimary and noncontributory is policy wording that makes your insurance pay first for a covered claim, without asking the additional insured’s own insurance to share the cost.Read the definition, so your policy answers before theirs.
4. A waiver of subrogationWaiver of subrogationA waiver of subrogation is an agreement, usually added to your policy by endorsement, that stops your insurer from recovering claim payments from a specific client, landlord or contractor.Read the definition on general liability and workers’ comp.
5. Workers’ comp for your employees, as your state requires.
6. A certificate of insurance before you mobilize, showing all of the above.
7. Often commercial auto for your vans and an umbrella or excess policy above your general liability, neither of which Corgi sells.

Completed operations is the line that matters most for plumbing, because your work stays in the building long after the GC’s job closes. If the exhibit lands the week before you mobilize, that’s still enough time. Corgi issues the certificate the day you buy, and you can send it to the GC straight from your account; if the subcontract’s limit is higher than yours, you can raise it the same day. The contractor insurance requirements guide covers the rest of the exhibit.

Is a sewer camera a “tool”?

It’s probably the most expensive thing in the van, so it’s a reasonable thing to wonder. Yes, as far as insurance is concerned: a sewer camera, a jetter, a press tool and a pipe threader are exactly the kind of equipment tools and equipment coverage is built for, typically covering theft from job sites, damage in transit and theft from a locked vehicle, usually subject to conditions such as signs of forced entry. Expensive items are often listed individually with their value, so add a new camera to the policy the week you buy it. Your van is a separate question, commercial auto, which Corgi doesn’t sell.

Crew injuries and licensing

Two systems watch you that have nothing to do with your insurer. The first is your state’s workers’ comp law. Cuts, burns from hot pipes and soldering, and ladder falls are the common injuries in this work, according to the Bureau of Labor Statistics, and when they happen to your employees they’re workers’ comp claims under your state’s rules, which also decide when you need coverage and who counts as an employee; find your state’s agency on the Department of Labor’s list, and if you work alone, see workers’ comp for business owners.

The second is licensing. BLS says most states and some localities require plumbers to be licensed, so check with your state or city licensing office, and ask whether it wants proof of insurance or a bond, rather than assuming the rules from a neighboring state carry over.