Insurance Premium Factors

Two spray foam contractors with similar revenue can be quoted very differently. Premiums are not a flat rate on your sales — carriers price the specific risk your operation presents, and most of what drives that number is inside your control. Here is what an underwriter is actually looking at when they rate a spray foam account.

The coverages you carry, and the limits you pick

Each line prices its own exposure. General liability responds to third-party bodily injury and property damage. Workers' compensation is rated on payroll by class code. Commercial auto follows your vehicles and drivers. Environmental and pollution liability covers the overspray, fumes and off-gassing exposures a standard GL policy usually excludes. Inland marine covers the rig and equipment itself. Higher limits and lower deductibles cost more; the right question is not "what is cheapest" but which limits your contracts and your general contractors actually require.

Payroll, revenue and how the work splits

GL and workers' comp are rated on exposure basis — typically payroll and gross receipts. Underwriters also want the split: residential versus commercial, new construction versus retrofit, and how much of the work is at height or in confined attic and crawl space conditions. Two operations at the same revenue can rate differently purely on that mix.

Class codes

The class code assigned to your crews drives the workers' comp rate before any credit or debit is applied. Spray foam work can be miscoded onto a neighbouring insulation or roofing class, and a wrong code follows you from year to year. It is worth confirming what you are coded as — a correction here often moves the premium more than shopping the policy does.

Claims history and your experience mod

Carriers pull loss runs, usually three to five years. Frequency matters more than a single large loss: several small claims signal a process problem, while one severe claim with documented corrective action often reads better. On workers' comp, that history becomes your experience modification factor, which multiplies the manual premium directly.

Subcontractors

If you use subs, expect questions about how many, what they do, and whether you collect certificates of insurance from them. Uninsured subcontractors typically get picked up on your policy at audit and charged as payroll — one of the most common reasons a renewal audit produces a bill nobody budgeted for. Collecting certificates is free; not collecting them is not.

How you spray, and what you spray

Open cell versus closed cell, the chemical systems you run, ventilation and re-entry practice, whether crews are trained and documented, and how you handle occupied-building jobs all feed the pollution and GL side. This is the part of the file where documentation earns money: a contractor who can produce job records is a better risk than one who cannot.

If you do not already keep a per-job record, the SPF work record form on this site captures the conditions, lot numbers and substrate details underwriters and claims adjusters ask for after the fact.

Your rig and equipment values

Inland marine is rated on what is actually on the truck. Scheduling the proportioner, hoses, generator and the rig itself at accurate replacement values matters in both directions — undervaluing invites a coinsurance problem at claim time, and carrying stale values on equipment you no longer own means paying for coverage you cannot use.

Where you work

Rates are filed by state, so the states your crews operate in change the number — as does operating in several states at once, which raises questions about licensing, comp coverage in each state, and travel exposure on the auto policy.

What actually moves the number

In practice the biggest wins are unglamorous: correct class codes, clean and complete loss runs, certificates on file for every sub, documented safety and job records, and accurate equipment schedules. Those are underwriting facts you control. Presenting them well is most of the difference between a submission that gets a competitive quote and one that gets declined or loaded.

If you want a read on where your own operation sits, request a quote and we will tell you what a carrier is likely to focus on before you go to market.