Operating an oilfield comes with great risk. Even though your operations are essential to people’s everyday lives, running a business – especially an oilfield – is inherently risky. That is why oilfield insurance exists. Commercial insurance can help mitigate the financial impact of unforeseen events, such as lawsuits, property damage, environmental damage, and more. Learn more about oilfield insurance below, including how ALIGNED can help you find a great policy.
Insurance coverage designed for oilfields
Each oil company has its own unique insurance needs. However, we generally recommend that oilfields have commercial insurance policies with the following coverages:
- Commercial general liability insurance: Commercial general liability coverage, or slip and fall insurance, protects your oilfield business against claims of third party bodily injury and property damage. It can cover the cost of injury or damages to a third party, the cost of a lawsuit (e.g. defence and court fees), and more.
- Commercial property insurance: Commercial property insurance protects your oilfield company’s office or other place of business, as well as any business-related contents from damage caused by an insured peril. Insured perils this coverage might protect against include water damage, fire, theft, windstorms, vandalism, etc. and can include lost revenue directly resulting from a covered peril like fire.
- Equipment breakdown insurance: If a piece of your oil refinery equipment suffers a mechanical or electrical breakdown due to a sudden and accidental covered peril like a pipe bursting due to pressure, equipment breakdown insurance might help cover the cost of repairing or replacing it.
- Commercial auto insurance: Commercial auto insurance is important if your oil company uses vehicles for commercial purposes, such as to transport tools and equipment or travel to and from job sites. Commercial auto insurance policies vary but may feature third party liability coverage, comprehensive coverage, uninsured automobile coverage, accident benefits coverage, collision coverage, and more.
- Pollution liability insurance: Since working on an oilfield can involve environmental hazards, pollution liability coverage is important. This coverage can protect your business from claims of third party bodily injury, property damage, or environmental damage resulting from your work.
- Directors & officers liability insurance: If your oil company has a board of directors and regarldess of whether it’s public or private you may wish to purchase directors & officers liability insurance as part of your oilfield insurance program. This coverage option can cover the cost of a lawsuit if any of your board members are sued for allegations like breach of duty, misprepresentation etc.
- Business interruption insurance: Business interruption insurance can protect your oil company from lost income if it is forced to close due to an insured peril. Again, insured perils covered by business interruption insurance vary but can include theft, fire, vandalism, windstorms, water damage, and more.
Factors affecting oilfield insurance costs
The cost of oilfield insurance varies between providers and companies. This is because insurance companies consider multiple factors when calculating premiums. Some of the factors that come into play include:
- The size and location of your oil company
- Your oil company’s annual and projected gross revenue
- Your insurance claims history
- The services offered by your oil company
- Your years of experience in the field
- The number of employees at your oil company
- The coverage, policy limits, and policy deductibles you choose
ALIGN your oilfield with commercial insurance coverage
Are you ready to align your oilfield with great coverage at a competitive rate? You have come to the right place. The experts at ALIGNED can match your oil company with a comprehensive commercial insurance policy in no time. Give us a call to speak with an ALIGNED insurance broker today. They will be happy to answer any questions you have, explain the benefits of oilfield insurance, and even provide you with an estimate. You can also click here for a free quote.