Chimney Sweep Insurance: Types, Cost, Benefits & More

What is Chimney Sweep Insurance?

Chimney sweep insurance is a legally binding contract between you and an insurance provider that partially or wholly covers you from financial losses from unexpected events such as fires, theft, accidents, and vandalism.

The insurance policy’s liability coverage largely depends on the terms and conditions of the contract, which include:

• The scope: The risks and adverse events covered by the insurer.

• The deductible: The portion of a covered loss you must pay before the insurance company’s coverage is activated. The higher the deductible, the lower the premium.

• The aggregate: The highest amount the insurer will pay for covered losses suffered by the company (the insured) within a specific period, typically a year.

• The consideration: The amount (or premium) you must periodically pay the insurer to stay protected.

Consider the following scenario to fully understand the role of each of these terms in an insurance policy.

Let’s say you have a property insurance policy with a deductible of $2,000 and an aggregate of $10,000. A tech inadvertently damages a homeowner’s roof while installing a chimney, costing $10,000. 

According to your insurance policy’s terms and conditions, you’ll have to pay $2,000 first, while the company covers the remaining $8,000.

Why Do Chimney Sweep Businesses Need Insurance?

Running a chimney sweep company is typically fraught with risks. It’s every business owner’s responsibility to limit their exposure to such risks by, for example, taking out an insurance policy. 

Beyond protecting your bottom line, here are other reasons why insurance is a crucial business expense.

Covers employee work-related injuries and illnesses

Chimney sweeps expose themselves to risks when repairing, cleaning, or installing a chimney.

They may fall off the roof or ladder. Or inhale soot and creosote, causing respiratory illnesses. Or they may suffer heat stroke or hypothermia.

Insurance policies help cover medical care, rehabilitation costs, and compensation for work-related accidents and illnesses.

Covers property damage costs

While chimney sweeps are highly skilled, accidents that damage client property can occur. 

A chimney can collapse and damage shingles, a ladder may fall and damage the client’s lawn, or hot sparks from metal tools can cause a chimney fire.

Insurance helps ensure any damaged property is repaired or replaced quickly. It also covers legal expenses and settlement fees from liability claims.

Ensures you remain operational

An insurance policy covers the legal, medical, and settlement costs from lawsuits and claims that might otherwise cause your business to shut down. It can also pay for repairing or replacing equipment and tools so you can keep operations running.

What Are The Benefits of Insured Chimney Sweeps?

Here are three key benefits that chimney sweep insurance brings to your business.

• Demonstrates credibility: Insurance shows you’re a credible business, making it easy for customers to trust you. It shows your company has the foresight to prepare for any eventualities and can cover any damage caused to the client’s property.

• Provides peace of mind: Knowing you're protected from financial liabilities puts your mind at rest. This lets you focus more on what you do best—cleaning or repairing chimneys—knowing the policy covers you in case of accidents, injuries, or equipment theft.

• Ensures compliance with regulations: Some jurisdictions require chimney companies to have basic insurance coverage to operate legally. Having insurance ensures compliance with such regulations and prevents hefty fines.

What Types of Insurance Do Chimney Sweep Businesses Need?

Picking the right insurance policy tailored to your business’s unique needs is crucial to protect your business from liabilities.

Here’s a list of the fundamental business insurance policies every chimney sweep company should have.

1. General liability insurance

General liability insurance is a primary type of insurance that protects you from financial losses from third-party personal injury and property damage claims.

Also known as commercial general liability insurance (CGL), this policy sometimes covers accidents sustained by third parties on your company’s premises.

Although CGL has a broad scope, it usually excludes coverage for events such as:

• Intentional property damage

• Employee work-related injuries

• Professional errors

• Company vehicle accidents

• Punitive damages from lawsuits

2. Worker’s compensation insurance

Worker’s compensation insurance covers the financial liabilities associated with work-related injuries or illnesses. It pays the injured employee’s medical costs, lost wages, and disability benefits.

If an employee dies on the job, worker’s comp provides crucial support for the surviving family members. This includes covering the employee’s funeral expenses and benefits.

Additionally, worker’s compensation may sometimes include coverage for lawsuits and claims filed by employees or their families.

Every jurisdiction in the United States—except Texas—has a law mandating that chimney sweep companies have worker’s compensation insurance.

To find the minimum coverage amount in your jurisdiction, consult your state’s Workers’ Compensation Board or NFIB’s worker’s compensation guide.

3. Commercial auto insurance

Commercial auto insurance provides collision and liability coverage for work vehicles. In case of an accident, it can help cover medical expenses and repair costs for:

• Your company vehicle

• Your employees involved in the accident

• The other driver and their vehicle

Almost every state in the United States, except Virginia and New Hampshire, mandates that businesses have auto insurance coverage for company-owned vehicles.

Other items covered by commercial auto insurance policies include:

• Payment for your injuries and property damage caused by an uninsured or underinsured driver.

• Company-vehicle damage arising from covered perils such as accidents, vandalism, fire, flood, and theft.

• Bodily injury or death resulting from accidents you cause and, occasionally, related legal fees.

4. Commercial property insurance

Commercial property insurance covers chimney sweep company–owned and rented properties in the event of natural disasters, fire, theft, and vandalism.

Furniture, supplies, inventory, equipment, tools, signage, and business records are examples of property covered by commercial property insurance.

Commercial property insurance is sometimes packaged with general liability and interruption insurance to form a business owner's policy (BOP).

Generally, property insurers use two significant methods to reimburse businesses for damaged property: actual value and replacement cost.

As the name suggests, actual value pays the current value of a lost or damaged property, considering depreciation from wear and tear. On the other hand, replacement cost pays the exact amount you'll need to replace a property of similar quality without considering depreciation.

5. Business owner’s policy

A business owner's policy is an insurance bundle comprising commercial property, business interruption, and general liability insurance.

For a standard BOP policy, the property insurance portion offers only named-peril coverage—it pays only for damage from perils explicitly listed in the policy.

The business interruption portion reimburses you for the loss of income caused by a covered peril such as a fire. It may also pay the costs you incur operating from a temporary location.

BOP insurance costs less than purchasing its constituent policies individually. However, insurers only issue them to businesses that meet certain criteria:

• Operate entirely outside their owners’ homes

• Operate primarily on the company's premises

• Have a small business location

• Generate less than $1 million in revenue yearly

• Have fewer than 100 employees

Additionally, most BOP policies exclude coverage for property damage arising from floods, but some insurers offer it as a policy add-on.

6. Umbrella liability insurance

This policy offers coverage for liabilities that exceed the coverage limits of your current regular insurance policies. It pays for extra costs beyond your primary policy’s limit and covers claims excluded from other policies.

The extra liability coverage provided by umbrella liability insurance prevents nightmarish situations where you’re forced to sell company assets to cover legal expenses and settlements.

For example, let’s say you cause property damage of $600,000 with the company’s vehicle. However, your commercial auto insurance policy has a property damage limit of $400,000, so you must cover $200,000 from your own pocket.

If you have umbrella insurance, it will cover a balance up to the limit set in the policy’s terms and conditions.

7. Inland marine insurance

This insurance protects valuable chimney sweep equipment and tools against covered perils while in transit on land, such as trips between your office and a customer’s location. It also covers company property stored away from your business location.

Inland marine insurance doesn’t cover:

• Immovable tools and equipment stored at your company location

• Company vehicles

• Property damage from floods and earthquakes

• Any property damage that happens before shipping

• Properties transported by sea or air

Several types of inland marine insurance are tailored to the liability coverage requirements of specific movable property. However, the basic types a chimney repair company needs include:

• Accounts receivable insurance: Protects your company from financial losses incurred when a customer fails to pay the money they owe. It also protects your accounts receivable.

• Contractor’s equipment floater: Covers your equipment and tools for damage, theft, or loss when they’re in transit, on your premises, or at the job site.

• Installation floater: Covers equipment, supplies, and tools while on the go or stored at the job site.

8. Professional liability insurance

Even the most experienced and professional chimney sweeps are bound to make errors, exposing them to negligence and other liability claims from unsatisfied clients.

For example, if a problem you fail to catch when inspecting a customer’s chimney causes bodily injury, the customer may sue you. Professional liability insurance will help cover the legal and settlement costs up to the policy’s limit.

Other liability coverage provided by professional liability insurance include:

• Failing to deliver a service by the agreed deadline

• Breaching a contract

• Inability to meet quality standards

• Negligence accusations

Pro tip: Professional liability insurance policies sometimes have confusing wording and unclear coverage. Consider consulting a lawyer before purchasing an insurance policy to ensure the policy covers the incidents you’re exposed to.

9. Equipment Insurance

Equipment insurance helps pay chimney sweeps to repair or replace their stolen, damaged, or lost tools and equipment. 

Some insurance policies also cover renting temporary equipment to minimize downtime while yours is fixed or replaced. They may also compensate you for lost income during this period.

However, some items are excluded from equipment insurance coverage:

• Equipment wear and tear.

• Equipment damage from intentional misuse, such as applying excessive force to scrapers and brushes.

• Tools and equipment older than five years.

• Company vehicles.

• Equipment and tools that cost more than $10,000.

10. Cyber liability insurance

Today’s chimney sweep companies increasingly embrace digital tools, exposing them to data breaches and cyberattacks with severe consequences—financial loss, reputational damage, and lawsuits.

Cyber liability insurance offers protection from cyber security incidents such as cyber breaches, network intrusions, and extortions. It pays for recovering stolen data, laundering your reputation, and settling legal fees from civil suits.

Cyber liability insurance policy also pays for:

• Carrying out forensic investigations to discover the cause of the cyber event.

• Notifying customers of the data breach.

• Settling government fines.

• Managing the crises arising from cyberattacks.

• Income lost due to cyberattacks.

How Much Does Chimney Sweep Insurance Cost?

Chimney sweep insurance can cost between $67 and $79. The actual cost depends on factors such as the following.

• Company size: Larger companies often have more assets and larger operations, increasing the potential for insurance claims. This naturally leads to higher insurance premiums.

• Headcount: Insurance premiums increase with employee headcount to account for increased liability exposure.

• Company location: Insurers charge higher premiums for companies operating in areas prone to natural disasters, theft, and vandalism.

• Type of insurance policy: A bundled package generally costs less than buying each constituent policy separately. 

How Chimney Sweep Software Gives You Added Protection

Beyond having the right insurance policies, using software to track your company’s growth and keep accurate financial and inventory records helps protect and grow your business.

ServiceTitan’s Chimney Sweep software facilitates centralized and accurate bookkeeping by connecting your back office with the techs in the field. 

With ServiceTitan’s Field Service App, field technicians can access critical customer information and send detailed updates back to the office in real time, instead of having to submit paper forms when they return from the field.

This eliminates data duplication and inconsistency, a common struggle for companies juggling multiple account records. Plus, it minimizes errors that lead to negligence claims by helping techs focus on the job.

Furthermore, ServiceTitan’s Chimney Sweep Field Reporting software helps you monitor your entire operation—techs, support staff, jobs, and customer payments—all from one place. This provides all the data you’ll need to file successful claims and defend against negligence claims and lawsuits.

Another helpful tool is ServiceTitan’s Inventory Software, which helps you track and manage all your inventory from one central location. You can track purchases, manage vendor returns and adjustments, transfer supplies, and trigger replenishments from one place.

This way, your trucks will always have the tools and supplies to deliver optimum service, preventing negligence claims and lawsuits.

Finally, ServiceTitan’s Service Scheduling software helps dispatchers plan job schedules ahead of time and apply tags to jobs requiring particular expertise, tools, and technical ability.

This improves customer satisfaction and prevents potential disputes resulting from delays or a technician arriving unprepared for the job.

How Do I Choose the Best Insurance Provider for My Chimney Sweep Business?

Picking the right insurance provider is vital for a chimney sweep business as it comprehensively covers you. Plus, they’ll work efficiently to process claims, minimizing delays and denials. This way, you can focus more on cleaning and repairing chimneys.

Here’s how you pick the right insurance provider:

• Assess your company’s needs: Discover the coverage you need by laying out your headcount, company size, type of services, and risk exposure. This will help you pick an insurance policy with the proper liability coverage.

• Seek help from an insurance agent: Consult insurance agents to help you pick an insurance policy. Consider using someone who previously worked with a chimney sweep business, as they will be conversant with your company’s unique risk exposure.

• Compare quotes: Shop for quotes from different insurance providers to get the best coverage at a competitive rate.

• Read the fine print: Before you pick an insurance provider, read and understand the terms and conditions. Pay close attention to the perils they cover and their coverage limits.

• Review and update your policies periodically: Your risk exposure increases as you grow. So, always review your policies and update them when you’ve exceeded their coverage limits.

The Bottom Line

Insurance offers coverage from liabilities and risks, so customers and your company’s assets are protected whenever accidents occur. This way, you can do your work without worrying about the risk of hefty fines, lawsuits, and settlements.

Before picking an insurance policy, consult insurance agents to secure adequate coverage at the best rates. Also, consider using chimney sweep software like ServiceTitan to bolster your bookkeeping process, monitor inventory, and track your company’s growth.

ServiceTitan is a cloud-based software chimney sweep company that automates customer interactions, record keeping, and other business operations. Over 100,000 contractors nationwide use it to streamline processes and boost revenue.