Plumbing contractors encompass a wide range of professionals and generally include anyone who installs or repairs pipes that carry liquids or gases. Plumbing contractors work in both residential and commercial settings and are often on call at all hours for situations such as leaks or pipe bursts that require immediate attention to prevent serious, long-term damage.
Typical residential tasks for plumbing contractors can include fixing leaking pipes, installing sinks and toilets, and repairing or replacing water heaters and water conditioning equipment. On the commercial side, plumbing tasks can include residential-type plumbing jobs (e.g., installing bathroom fixtures), mechanical services, sprinkler system installations and repairs, steamfitting and pipe services, and lawn sprinkler system maintenance.
In most instances, plumbing contractors will complete an apprenticeship or a technical school program in order to gain experience. In terms of certification, most states and cities require plumbers to be licensed.1
Plumbing businesses can range in size and include entrepreneurial individuals working for themselves, small independent businesses and large national operations. There are also plumbing franchises that are independently owned with set territories.
When it comes to industry classification, plumbers will fall1 under a larger group of artisan or specialty contractors in one of two ways:
Industry outlook and trends
Overall, the plumbing industry is growing and doesn’t show signs of slowing down any time soon. There will always be a need for this trade, which is evident when you consider that there were 121,876 plumbing businesses and 518,031 industry jobs by the end of 2019, and revenue was approximately $113 billion.2
However, it should be noted that plumbing contractors are a part of larger construction trends. This means that an economic downturn affecting the construction industry would have a significant impact on plumbers.
Here are some other industry trends and considerations of note.
According to the most recent data from the Bureau of Labor Statistics (BLS), the plumbing contractor job outlook is estimated to increase 14% over the next 10 years.3 During that same period, the BLS anticipates an average growth rate of 5% for all occupations.
With industry-specific growth outpacing employment averages, finding qualified employees is likely to be a major concern for plumbing contractors.
Due to the extensive training and apprenticeship programs, it can take years for someone to become a licensed plumber, making it critical for plumbing contractors to retain their employees. This could drive salaries up with expected growth and overall low unemployment. As it stands, the average annual salary for a plumber is $53,910, compared to $38,640 across all other occupations the BLS tracks (e.g., construction and manufacturing).3
Environmental concerns continue to be a major trend in the trades, and plumbing is no exception. Reducing water usage is a nationwide focus, particularly in areas prone to droughts. In response, many plumbers are leveraging technology to reduce energy usage and improve the efficiency of their operations.
Trending4 technology in plumbing includes:
- Tankless water heaters – Simply put, traditional water heaters are inefficient. They’re designed to heat a large quantity of water, regardless of what is actually needed. But tank water heaters still may not be able to keep up with the demand of large households. In comparison, tankless water heaters heat only what is needed. As a result, the Department of Energy estimates up to 25% in energy savings for those who utilize tankless systems.
- Greywater recycling – Greywater refers to wastewater from sinks, washing machines, showers, baths and kitchen appliances. Greywater is relatively clean, which contrasts heavily with blackwater, which can contain human waste. Greywater systems are designed to capture the water for reuse, thus reducing water demand. While it can’t be used for human consumption, greywater can be used for things such as watering the grass or the garden.
- Smart pipe systems – These systems use sensors to determine whether there’s a leak. Being able to quickly identify a leak can help prevent serious damage.
- Infrared technology – While infrared cameras are often used for detecting electrical issues, they can also help detect leaks and moisture – and determine the source.
- Telematics – GPS and other telematics systems for tracking vehicle data are being more widely implemented by plumbing companies and other contractors with light- and medium-duty vehicles. In addition to helping track risky driver behaviors such as speeding and hard braking, they can also help with dispatching and efficiency.
For plumbing contractors, deregulation could play a major role in some states.
One argument for regulation – specifically licensing – is that it helps ensure plumbing contractors hire qualified employees. An argument against increased regulation is that it creates a barrier to entry for individuals or companies due to the cost and time associated with securing licensing.
Not all states or cities require licensing.1 In fact, Texas recently came close to eliminating licensing requirements altogether. Notably, in states where there is less regulation, hiring and training standards are even more crucial if businesses are to avoid liability claims.
Other regulatory trends relate to environmental concerns. In some areas, especially in western states, mandated water usage limits are in place. As a result, greener technology, such as greywater recycling, may become more common.
Insights on major lines of coverage
Exposures, precautions and lines of coverage that may apply in the plumbing industry.
Exposures will depend on the type of work the plumber is doing. Some operations may only involve contractor storage and an office. In contrast, commercial operations may involve cutting and welding material, which create more fire hazards and property exposures.
- Precautions: A hot work program should be in place for any welding or cutting operations.
Theft of property is a significant concern for plumbing contractors. Some materials, such as copper pipe, are a target for thieves. Plumbers may also have expensive tools they store at their place of business, at job sites and in vehicles.
- Precautions: Security measures should also be in place. For example, plumbing contractors should keep buildings and vehicles locked and expensive tools out of view.
Cuts and lacerations from contact with piping or working in tight places are common for plumbers. In addition, exposure to contaminants, fumes, mold from water-damaged materials, asbestos and lead are serious hazardous substance concerns.
- Precautions: Training for workers should include hazard communication, chemical safety and personal protective equipment (PPE).
Electrocution risks are significant for plumbing contractors, as they frequently work in and near water. In particular, exposed and live electrical components on a job site create potential shock risks.
- Precautions: To reduce electrocution hazards, electrical safety training is a must for plumbing contractors. In addition, plumbers need to understand how to inspect electrical equipment and components before working near them.
Plumbers connecting to water mains can suffer serious or fatal injuries following a trench collapse. Additionally, for plumbers who vent pipes on roofs, fall exposures may be present. Exposures for residential plumbers are significantly different from those of commercial plumbers.
- Precautions: Training for workers should include PPE as well as trenching and confined spaces safety.
Liability (Completed Operations)
Exposures for ongoing operations are similar to completed operations, but they also take property damage from hot work into account. For both ongoing and completed operations, the Commercial General Liability pollution exclusion should be considered. Limited pollution liability for “pipe break” pollution losses should also be considered. Nationwide has a coverage form to respond to these incidents.
- Precautions: Precautions for ongoing operations are similar to those related to completed operations. The insured should have programs (e.g., hot work, employee training and project recordkeeping) in place to minimize their losses.
Recommended lines of coverage: General liability, inland marine, property, workers’ compensation and commercial auto