Let talk insurance. Still in the planning process of purchasing a 40t class truck crane and starting a taxi crane service in the midwest. I know insurance is a heavy expense in this business, can anyone give me a general idea of what I might be looking at for a single owner operator setup per year? And insurance providers I might call to get quotes. Thanks!
I can’t give prices right now since my records aren’t with me but I can share this info. Be careful with terminology. They like to quote insurance that reads...as long as you don’t overload the crane. My agent didn’t understand I could overload a 40ton crane with 5,000#. Also you need to insure below the hook items. My policy that covers that is a riggers policy. It is not included it the units policy automatically
Be prepared to rob a bank. With a Covid mask, they won’t see it coming.
My customer insurance requirements used to be around 1-2 million liability. That number has creeped up for municipalities and some large general contractors wanting 3, a few want 5 million of general liability. I've had one job that was looking for 10 million of coverage. (I didn't do that one). You'll have to add a business vehicle policy- if you have a pickup and deliver a manbasket to a jobsite- it has to be covered. Most large generals will need a copy of that also. You'll also need a workman's comp policy. By law if you are self employed in my state, you don't have to have workmans comp, but almost all contractors are going to need to see a copy of a workmans comp policy, because if you don't have it, they are going to have to cover you if they get audited. They will want copies of a workmans comp policy for you to work for them. If whatever state you are running in requires tags/ plates on the crane or boom truck, and you are close to a state line border, then you're neediing interstate authority and DOT's and all the insurance that goes along with that. As well as a random drug pool and a whole host of other paperwork. The DOT #'s do make permits a little easier also, but its not totally necessary. A really rough rule of thumb is 10-15% of your gross income will go to general liability, and another 5% of that amount to all the other stuff. If you can bill $150,000 for your crane in a year, its going to cost you $20-$30,000 for the insurance. You can probably find someone to write you a policy for around $10,000 if you show yourself as a general contractor doing work with just a crane as extra piece of equipment. But if you are upfront that you are a true crane rental with operator business and want riggers, below the hook, inland marine in addition to the workman's comp, it all costs $$, because the insurance companies base their rates on exposure. The banker is going to want his crane that he loaned $$ on to be covered also. So just for fun- you've got one crane (40 ton) at $150/ hr and you bill 1,000hrs your first year. You won't bill 2,000 hrs a year because some little HVAC contractor wants the crane at 10:00 to change a unit and its a 3hr min and you can't do a job before that and you won't have time to do one afterwards. So lets call it 1,000hrs. That's $150,000 in gross. You're going to drop 30,000 in various forms of insurance, another 30 in repairs /fuel/ oil/ tires etc. $10,000 in taxes fees licsense, etc. So you have $70,000 left to make the payments on the crane, pay for a industrial place to park it and work on it. Figure $20,000 for the payments and you're left with $50,000, to cover your wages, health insurance, taxes etc. There are places to shave $$ off of my figures of course, but if you lose a engine in your crane- its $10,000 to buy it, and another $10,000 if you can't put it in yourself. A third member is $3,000 and double that if you can't put it in. A set of drive tires is 8x$300 = $2,400. I had a guy start up a little crane business about a 1/2hr. drive from my shop, about a year and a half/ two years ago. One guy- little old sign truck to start and shortly after a small boom truck. Was running around for $60/ hr with the sign truck and just eating my lunch on small truss jobs and small units. He was charging a little more for the boom truck. Today the boom truck is for sale and he has his resume on Jobs Indeed. Its not easy, and with what he was billing, he just as well have a job in town as lose $ every day. If I was wanting to budget to start, I'd put a minimum of $10,000 to cover insurance, and I'm going to bet if you don't cut corners or lie to the insurance man, its going to be closer to $20,000 for all of your insurance needs.
Crane operator, thank you very much for the response. I'm just now noticing it My plan at the moment is to postpone until after the election and see how the economy reacts, I'm currently running a few machines at the Kennedy Space Center in Florida, but I'm a Midwesterner and I've always dreamt of the day I'd buy a machine and try to make it on my own. I'm entrepreneurial at heart, so sitting down here making 1 pick a week collecting government wages is great for the paycheck, but killing my desire to work hard and build something, if that makes sense.
You need to peruse Crane Operator's, Tradesman's and Natman's threads. All 3 are what appear to be successful crane owners. You will get a good insight into owning and operating a crane(s). Lot's of good info and insight.
Don't forget Impact.