Bureau of Labor Statistics estimated there were around 650,500 employed electricians in the U.S. in May 2021. The Bureau also projects the number of employment opportunities for electricians to be about 85,000 every year as the market grows and people change their occupations or retire. 

These numbers do not include self-employed workers, and about 8% of electricians are self-employed. At the same time, there are 223,776 electrician businesses in the US in 2022.

Not all electricians have the license to work on their own and without supervision. That’s why different types of electrician licenses exist that indicate what kind and level of services an electrician is allowed to perform. 

Most states require that electricians carry a license to be able to work, but not all of them. For example, there are no state requirements in Illinois, Indiana, or Kansas, but local ones might still apply, so you should ensure you are compliant. You should also note that each state has its own requirements for different kinds of licenses, and you should look into them before applying for yours.

Apart from the required licenses, you should also look into recommended insurance policies that protect your business, whether you are a business owner, contractor, or self-employed electrician. If you are unsure about what policies you need, you might want to work with a broker who can assist with selecting the right coverage for your business.

Let’s look into the types of electrician licenses and the general license requirements for each before discussing what insurance policies electrician professionals need.

Apprentice Electrician License Requirements

If you wish to become a licensed electrician, you must meet a few conditions before applying for a license. An electrician’s career journey usually starts with an apprenticeship or a trainee program or through getting a college degree that would qualify them to become an electrical engineering technologist or assistant.

Some future electricians pursue an Associate Degree in Electrical Technology as their introduction into the field. It takes two years to complete and allows students to seek employment after graduation. However, many decide to continue their education and earn a degree in engineering.

However, you don’t need a formal education to become an electrician. You can break into the field through apprenticeship programs.

An apprentice or a trainee, depending on the official terminology in your state, can start their training after graduating from high school. If your high school program provides vocational training and classroom instruction for becoming an electrician, that should help you get an apprentice license that will allow you to find an apprenticeship program.

You can apply for one of these programs even without vocational training, but you will need to spend a bit more time in the classroom together with your on-job training. Note that you can apply for your learning license before you find a suitable apprenticeship program or after you get accepted for one.

Employers sometimes sponsor apprenticeship programs as they are a good way to find help for their journeymen and master electricians and to discover talent early. Some organizations, such as the National Electrical Contractors Association (NECA), also support apprenticeships.

Apprenticeships usually last four years, and apprentices work under the supervision of a seasoned electrician. One year brings around 2,000 on-job training hours and 144 hours of classroom education.

Journeyman Electrician License Requirements

Every state has requirements that electricians must fulfill to apply for a journeyman license, and in some states, testing requirements vary by location. To qualify for a journey-level electrician license, you must have at least four years (or 8,000 hours) of verifiable experience working under the supervision of a licensed electrician and the accompanying classroom education. 

You must also pass an examination administered by your state’s licensing board or a nationally recognized organization like the National Electrical Contractors Association (NECA), depending on your state or local requirements. Contact your local government agency to learn all the details, including eligibility, fees, and testing requirements.

You should also note that you will need to renew your license, usually every year, or every two years, depending on the state laws, and complete a certain number of continuing education hours.

Master Electrician License Requirements

A master electrician license is the highest level of electrical licensing available. A master electrician can supervise other electricians in addition to doing residential and commercial electrical work.

To qualify for a master electrician license, you must have at least eight years of experience working under the supervision of another master electrician. Also, in most states, you must have your journeyman electrician license for at least two years before applying for a master electrician license.

After you have completed these prerequisites, you can apply for your master electrician license exam. Note that your experience must be documented through defined verification forms. Just like your journey-level license, you need to renew your master electrician license when your state or local laws require that.

Contractor’s Certification Requirements

You should first note that a certificate doesn’t replace a license, and you need to be licensed to be able to work as an electrician. To obtain a contractor’s certificate, you must first have a journeyman or master electrician license to be precise, and you will have to pass an exam administered by your state or local licensing board. 

In addition to the examination, most states also require that you have a certain amount of experience working as a licensed electrician before you can apply for a contractor’s license. Typically, you will need at least four years of verified work experience to be eligible for a contractor certificate.

In some states, you need to employ at least one master electrician to get certified for starting your electrical contracting business. Since a contractor certificate is like a business license, you will also need proof of insurance to start your business. Some states require that you provide insurance certificates within 30 days of obtaining your contractor license, and they also require certain policy limits.

What Insurance Policies Should Electrician Contracting Businesses Have?

A man looking at the list of insurance policies for an electrician contracting business

Working in the field, often on construction sites, carries risks of injuries or damage to other people’s property, and it’s no secret that electrician contracting businesses are at a higher end of the risk scale for liability claims and lawsuits. Having the right insurance policies in place can prove to be crucial for protecting your company from the potentially devastating financial consequences of such claims.

Let’s look into the policies experts recommend every electrician contractor should have.

General Liability Insurance

General liability insurance is an essential insurance policy for any electrician contracting business. This policy can protect against a wide range of claims, including third-party bodily injury or property damage. It also covers claims of personal injuries, such as libel and slander.  To a certain extent, it also covers product liability claims, but you should consult a broker to ensure you have the right amount of coverage for your product liability exposures.

For example, if you or one of your employees damage the equipment of other contractors working on the same project as you, they can sue your company for damages. Your general liability policy can help cover the cost of legal defense and any settlements or judgments awarded against you.

Contractor’s E&O insurance

Nobody is immune to professional errors, and an electrician’s professional mistake can prove to be especially damaging. If you accidentally overload a circuit board or cause a failure that damages appliances, a client can sue you for compensation for the damage they suffered. A claim like this can end with a settlement that would reimburse the client for replacing damaged installations and electronic goods.

If you fail to complete what you promised by the date stipulated in the contract you signed with your client, they can sue you for not honoring the deal. E&O, or professional liability insurance, can protect you against breach of contract, misrepresentation, and negligence claims, among others.

Workers Compensation Insurance

Another essential insurance policy for electrician contracting businesses is workers compensation insurance. Suppose one of your employees is injured while on the job. Workers comp policy can help cover their medical expenses and lost wages during the time they are unable to work. 

Most states require that businesses that employ one or more workers carry workers compensation insurance, with the exception of Texas. However, some companies are exempt from having workers compensation coverage, but that varies from state to state. 

Even if the state law doesn’t mandate workers comp for a business like yours in your state, it’s still a good idea to have this coverage in place to protect your business from the financial impact of workplace injuries.

Business Owners Policy (BOP)

A business owners policy (BOP) is a good solution for small companies that look to bundle general liability, property, and business interruption insurance into one solution. Purchasing a package policy will allow you to pay less for these coverages if your business is eligible for a BOP. If you need more coverage, you should consider buying separate policies for these exposures.

Property insurance would reimburse you for damage to your property, such as an office you use to conduct your operations or a warehouse where you store your equipment. Business interruption insurance covers the lost income and other expenses if the business must shut down temporarily because of a covered peril.

When selecting a BOP for your business, it’s important to work with an experienced insurance agent to make sure that you’re getting the coverage you need. Not all BOPs are created equal, and the right policy for your business will depend on your specific needs.

Commercial Auto Insurance

If your electrician contracting business uses vehicles to transport tools, equipment, or materials, you need to ensure you have commercial auto insurance in place. Commercial auto insurance can help protect your business from the financial consequences of accidents, vehicle damage, and injuries that may occur while your employees are driving on the job.

It also covers losses stemming from theft, vandalism, or severe weather conditions. The policy also pays for damage inflicted on other people’s vehicles if you or your employee is to blame for a collision.

Commercial automobile insurance protects you and your assets as the company owner, but it also protects your employees and any other drivers you hire for business reasons. Commercial cars face a wider range of hazards than personal ones every day, which is why it’s essential that you get comprehensive coverage for your company vehicles.

If you need more information about the policies you need to purchase for your contracting company, you can reach out to one of our experienced brokers. If you are ready to get online quotes, you can start by signing up to Embroker’s digital platform.

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