ACE HANDYMAN SERVICES

The Ace Handyman Services franchise disclosure document requires workers' compensation with employers liability, general liability at $1,000,000 per occurrence and $2,000,000 aggregate including a crime policy endorsement of at least $25,000, commercial auto at $1,000,000 per occurrence and $2,000,000 aggregate, an umbrella of at least $1,000,000, and all-risk business property insurance. Ace Handyman Franchising, Inc. must be named as an additional insured with a waiver of subrogation on every required policy.

The named insured on your certificate is your own legal business entity — the LLC or corporation you operate through. Ace Handyman Franchising, Inc. is the franchisor. Additional insured means the franchisor is added to your policy so it shares in the protection if it is pulled into a claim arising from your work. A waiver of subrogation stops your insurer from later trying to recover from the franchisor.

That is what the agreement establishes. Here is what a carpentry, drywall, flooring, painting, and light-trade repair operation actually faces — starting with the trade your techs are not supposed to be doing.

The franchisor entity is Ace Handyman Franchising, Inc., a Colorado corporation with its principal business address at 390 Union Boulevard, Suite 520, Lakewood, Colorado 80228. The 2025 franchise disclosure document, Item 8, sets out the following required coverages.

Workers Compensation with Employers Liability, including a broad-form all-states endorsement. Workers' compensation pays medical bills and lost wages for an injured tech, no matter who was at fault. Employers Liability is its sister coverage — it responds when an injured worker sues the employer, claiming the employer's negligence contributed to the injury. The FDD requires statutory limits, or at least $1,000,000 if your state has no statutory requirement.

General Liability at $1,000,000 per occurrence and $2,000,000 aggregate, including product liability, property damage, personal injury, bodily injury, and premises and operations liability. Per occurrence means the most the policy pays for any single claim event. Aggregate is the cap for the whole policy year. The FDD also requires a crime policy endorsement of at least $25,000 attached to this coverage.

Commercial Auto Liability at $1,000,000 per occurrence and $2,000,000 aggregate, including hired and non-owned vehicles. Hired and non-owned auto covers vehicles your business uses but does not own — a rented truck or a tech driving their own car to a job.

Umbrella / Excess Liability at not less than $1,000,000. An umbrella adds a layer of limit on top of your general liability, auto, and employers liability for a claim that exceeds the primary limit.

All-Risk Business Property insurance covering equipment, tenant improvements, inventory, and personal property at 100 percent of replacement cost, with a deductible no higher than $5,000.

All required policies must name Ace Handyman Franchising, Inc. as an additional insured with a waiver of subrogation, and provide 10 days' advance written notice of cancellation. The FDD also lists cyber liability at not less than $250,000 as optional but highly recommended, and reserves the right to require employment practices liability insurance.

Ace Handyman Services markets carpentry, drywall, painting, flooring, light plumbing, and light electrical. The brand emphasizes licensed and insured technicians. But "handyman" and "licensed plumber" are two different legal categories in most states, and the line between them moves with the task. Swapping a faucet is handyman work. Re-piping the supply lines behind it can require a licensed plumber. Replacing a light fixture is handyman work. Adding a new circuit at the panel can require a licensed electrician.

Your general liability policy assumes you operate within your license. When a tech crosses into work that legally required a licensed trade — and your business did not hold that license — the carrier can argue the loss arose from unlicensed work. Some policies carry a classification limitation or a professional services carve-out that removes coverage for work outside the scope you disclosed. The claim that results is not denied because the work was bad. It is denied because the work was the wrong category.

This is the central exposure of a multi-trade brand. The more trades your techs touch, the more often a "simple repair" lands in a licensed category nobody planned for.

A handyman tech works inside the home, surrounded by the customer's property. A ladder shifts and gouges a hardwood floor. A dropped tool cracks a granite countertop. A drywall repair sends dust through a room of upholstered furniture. These are not failures of the repair itself. They are accidental damage to property near the work — and that distinction decides whether the claim is covered.

General liability generally covers accidental damage to a customer's other property. The exposure shows up in two exclusions. The first is the "your work" exclusion, which removes coverage for damage to the specific thing you were working on. If your tech is refinishing a cabinet and the finish fails, the cabinet is your work and the policy steps back. The second is the care, custody, and control exclusion, which removes coverage for property in your control or that you were handling when it was damaged — the antique your tech moved to reach the wall, the appliance set aside during a floor repair.

For damage to property in your care, the coverage to ask for by name is a care, custody, and control endorsement, sometimes written as a bailee form. It is not automatic on a standard handyman GL policy.

Many handyman jobs sit just below the threshold that triggers a permit. Many do not. Structural work, electrical changes at the panel, gas-line work, and additions usually require a permit pulled and an inspection passed. When a tech does that work without a permit — to save the customer time, or because nobody flagged it — the legal status of the job changes.

If something goes wrong on unpermitted work that legally required a permit, your general liability carrier has a path to limit or deny the claim. Some policies exclude losses arising from work performed without required permits or in violation of building code. The damage might be a genuine accident, but the carrier can point to the missing permit as the reason the work should not have been done that way at all. The same logic applies to the building code exclusion: GL typically will not pay to bring non-compliant work up to code, and may contest damage that flows from a code violation.

The protection here is partly operational and partly coverage. Pull the permit when the task requires one. And confirm your policy does not carry an aggressive permit or code exclusion that would leave you exposed on exactly the higher-risk jobs where a permit was needed.

An Ace Handyman tech is often alone in a customer's home for hours — moving through rooms, in and out of spaces where valuables, cash, and jewelry sit. Most jobs end without incident. But the in-home, unsupervised access is real, and so is the day a customer reports a missing watch or a piece of jewelry after the tech leaves.

General liability does not cover employee theft. Theft by your own tech is dishonesty, not an accident, and the standard policy excludes it. The FDD addresses this with a required crime policy endorsement of at least $25,000. That is a real coverage and better than nothing — but $25,000 is a low limit against a single piece of high-value jewelry or a pattern of small thefts across many homes.

The stronger protection is a third-party commercial crime policy with a theft-of-customer-property endorsement. Third-party here means it covers theft of the customer's property, not just your own. 

A crime policy generally pays without requiring a criminal conviction and does not seek to recover the money back from you afterward — two important advantages over a low-limit bond-style endorsement. Rikor's benchmark for a brand whose techs work alone in homes is a third-party crime policy at $250,000, which raises the FDD's $25,000 floor to a limit that matches the exposure. The FDD requirement and the benchmark are not in conflict: carry the required endorsement for compliance, and raise the limit to where the real risk lives.

This is where a multi-trade brand gets tested. Workers' compensation is priced by classification code, and each code has its own rate. Carpentry, drywall, painting, and flooring do not all carry the same rate. A tech who frames and installs cabinetry is rated differently than a tech who only paints. When your business performs many trades, the carrier has to decide how to classify your payroll — and that decision drives your premium.

Two things are worth understanding. First, the rate. Workers' compensation premium is your payroll divided by 100, multiplied by your state's rate for each classification code, multiplied by your experience modification — a factor based on your past claims. The per-$100 rate for each code is set by your state's rating bureau, the National Council on Compensation Insurance (NCCI) in most states, or an independent state bureau in a few. The carrier applies that rate. It does not invent it.

Second, the audit. Workers' compensation is auditable. At the end of the policy year, the carrier reviews your actual payroll — and how it was split across classification codes — against what you estimated at the start. If your techs spent more time in a higher-rated trade than you disclosed, the audit can reclassify that payroll and adjust the premium upward. That is not a claim denial. It is a year-end billing adjustment that reconciles what you actually did against what you estimated. The fix is disclosure at policy inception: describe the real trade mix to your carrier so the codes are set correctly from the start, and keep payroll records that show how time was actually split.

Your premium depends on your state, your payroll, your revenue, your trade mix, and your claims history. What you can control is understanding how the number is built — and preparing for the part that arrives as a surprise.

General liability and workers' compensation are both auditable. An audit is the carrier's year-end review that compares what you estimated when the policy started against what actually happened, then adjusts the premium up or down. The audit can move in either direction — if you overestimated, you get money back.

General liability for a handyman contractor is usually rated on gross receipts — a rate per $1,000 of revenue — or on payroll, depending on the carrier and class code. Payments to 1099 subcontractors who cannot produce their own certificate of insurance are added to that base. Workers' compensation is rated on payroll: your payroll divided by 100, multiplied by your state bureau's rate for each trade code, multiplied by your experience modification.

A worked example on the revenue side. Say you estimate $200,000 in revenue when the policy starts — a reasonable year-one figure for a new Ace Handyman franchise. The business takes off and you finish at $480,000, a $280,000 difference. If your general liability is rated at roughly $8 per $1,000 of revenue, the audit adds about $2,240 in premium. That bill usually arrives as one lump sum a few months after the policy year closes.

Ace Handyman's FDD is stronger than most handyman agreements — a required umbrella, a required crime endorsement, and required business property are all meaningful. The gaps lie in what the FDD sets too low, and in the coverages it leaves optional or silent. The recommendations below are Rikor's baselines, calibrated for a newer franchisee and scaled by revenue, payroll, trade mix, and years in business. They are not fixed numbers — a startup with two techs and a five-year operation with twelve techs and commercial accounts sit at different points on every line.

Third-party crime at $250,000 — raise the FDD's $25,000 endorsement. The FDD requires a crime endorsement of at least $25,000. Your techs work alone in homes filled with valuables. General liability excludes employee theft. Carry a third-party commercial crime policy with a theft-of-customer-property endorsement at $250,000, which pays without a conviction and does not claw the money back. Keep the required $25,000 endorsement for compliance and raise the operating limit to $250,000.

Care, custody, and control endorsement on the GL. The FDD does not address the CCC exclusion. Add a CCC endorsement so the policy can respond to damage to a customer's property in your tech's care during a job. Size the limit to the value of the homes and contents you actually work around.

Independent Contractors Liability endorsement. Handyman models rely on 1099 trade subs for licensed plumbing and electrical work. Confirm your general liability has no subcontractor exclusion and that it extends to liability arising from subs. A subcontractor exclusion on a sub-heavy operation removes coverage exactly where the licensed-trade exposure lives.

Contractors Errors & Omissions, exposure-gated. Contractors E&O covers two things standard GL can miss: professional judgment errors that cause financial loss without property damage, and faulty workmanship that GL's "your work" exclusion removes. For a multi-trade operation taking on remodel-prep or design-adjacent work, or any commercial accounts, E&O at $1,000,000 per claim and aggregate is worth reviewing. For a pure small-repair residential operation, it may not be needed yet.

Cyber at $250,000 — the FDD recommends it; carry it. The FDD lists cyber at $250,000 as highly recommended. Ace Handyman's scheduling platform, customer database, and payment processing create a breach exposure. Rikor's benchmark for a newer franchisee matches the FDD's $250,000, scaling to $500,000 once revenue crosses $750,000.

EPLI at $250,000 to start. The FDD reserves the right to require employment practices liability but does not currently mandate it. EPLI covers claims from employees alleging wrongful termination, discrimination, harassment, or wage violations. Rikor's baseline for a newer franchisee is $250,000, scaling toward $250,000–$500,000 as headcount passes ten or revenue crosses $750,000.

Inland marine for tools and equipment. Your auto policy covers the truck, not the tools inside it. Inland marine — also called an equipment floater — covers tools and equipment in transit, at job sites, and in the vehicle, on an actual cash value basis. Size it to the replacement value of what your techs actually carry; a multi-trade van is a meaningful number.

Umbrella — you already carry $1,000,000; reason from your worst realistic loss. The FDD requires a $1,000,000 umbrella, so that layer is in place. Whether you need more is a severity question. Most handyman work is residential with property-damage losses that sit inside a $1M/$2M primary stack. The umbrella becomes more important as you take commercial property-management accounts that require $2,000,000 or higher certificates, as job sizes climb, or when a tech drives owned vehicles on highways with a fleet. Reason from your actual work: when the realistic worst case — a serious in-home injury, a fire from electrical work, a highway auto loss — could exceed your primary limits, raising the umbrella is the right move.