Insurance is one of the most important investments for installation businesses in California. Whether you’re handling HVAC systems, electrical wiring, glass installation, or appliance setups, you’re exposed to risks every day. But beyond your trade, one key factor that determines how much you pay for insurance is your claims history.
Insurance companies carefully analyse the number and type of claims you’ve filed in the past. For installers, even one or two incidents can affect premiums for years. Understanding how claims history impacts your insurance costs can help you adopt smarter risk management strategies and keep premiums affordable.
Your claims history is essentially the record of all past insurance claims filed by your business. This includes:
General Liability Claims – For third-party property damage or injuries.
Workers’ Compensation Claims – For employee injuries on the job.
Commercial Auto Claims – For accidents involving company vehicles.
Tools & Equipment Claims – For theft or damage to equipment.
California insurers use this history as a benchmark to predict your future risk. If your business has frequent or severe claims, insurers see you as more likely to generate losses, leading to higher premiums.
Insurance is built on risk prediction. For installers in California, insurers look at:
Frequency of Claims – Multiple small claims indicate poor safety practices.
Severity of Claims – A single large claim, such as a $100,000 liability payout, can impact premiums for years.
Type of Claims – Auto accidents vs. job-site injuries vs. property damage. Some are more concerning than others.
Time Frame – Most insurers review the past three to five years of your claims record.
An installer with no claims in the past five years may qualify for preferred rates, while one with multiple claims may see premiums double or face non-renewal.
A door and window installer who has filed several claims for broken glass at client properties will likely face higher liability premiums. Insurers assume repeated mistakes could continue.
In California, workers’ comp is heavily influenced by your experience modification rate (EMR). This number reflects your business’s claims history compared to others in your industry. A low EMR (fewer claims) leads to discounts, while a high EMR raises costs significantly.
If your installation vans are frequently involved in fender benders or theft claims, your auto insurance rates will spike. In fact, auto claims history is one of the most common reasons California installers pay more for insurance.
A history of theft claims suggests poor security, so insurers may increase deductibles or charge more to cover tools in transit.
Imagine two flooring installers in California:
Installer A has operated for five years with no major claims. Their general liability premium is around $1,200 annually.
Installer B had three liability claims in the past three years, costing insurers nearly $50,000. Their annual premium now exceeds $3,500, even though the businesses are similar in size.
This illustrates how claims history directly impacts costs.
Accidents often stem from preventable issues. Regular safety training, job-site inspections, and proper use of protective gear can reduce workers’ comp and liability claims.
Because theft is common in California, especially in urban areas, storing tools in locked containers and using GPS tracking for vehicles can reduce claims.
Not every minor incident needs to be filed. For small losses you can afford to cover, paying out of pocket may prevent your claims history from being impacted.
Some insurers offer lower premiums if you participate in risk management programs, install vehicle telematics, or adopt OSHA-compliant practices.
California’s insurance market is one of the most regulated in the U.S. Insurers must file rates with the California Department of Insurance, but they still weigh claims history heavily.
Workers’ comp rates are directly tied to your experience modification rate.
General liability insurers in California often surcharge contractors with even a single large claim.
Auto theft rates are higher in cities like Los Angeles and San Francisco, which makes claims history even more critical for installers operating in those regions.
If your installation business has had multiple claims in recent years, you can still work toward lowering premiums:
Ask insurers about loss control services to identify risk improvements.
Raise your deductibles to share more of the risk.
Bundle policies (auto, liability, and tools) to access multi-policy discounts.
Keep a clean record moving forward—most surcharges drop off after three to five years.
For California installers, claims history is one of the most influential factors in determining insurance premiums. A strong record with few or no claims can help you secure better rates, while repeated incidents can dramatically raise your costs. By focusing on safety, theft prevention, and smarter claims management, installers can protect both their business and their bottom line.
To explore insurance solutions designed for installation businesses in California, visit Western Insurance