Top Mistakes New Oil & Gas Pipeline Contractors Make And How to Avoid Them
- Nate Jones, CPCU, ARM, CLCS, AU
- 5 days ago
- 2 min read
Breaking into the oil and gas pipeline industry can be highly profitable—but it’s also unforgiving for new contractors who make early mistakes. From compliance issues to insurance gaps, small missteps can lead to major financial losses. Understanding the most common pitfalls can help new pipeline contractors protect their business and grow sustainably.
1. Underestimating Insurance Requirements
One of the biggest mistakes new oil and gas pipeline contractors make is not carrying enough insurance—or the right type of coverage. Many assume basic general liability is enough, only to discover too late that clients require additional policies such as pollution liability, workers’ compensation, or commercial auto insurance.
Major operators often require proof of coverage before awarding contracts. Without it, contractors may lose out on high-paying projects. Working with a specialized broker like Wexford Insurance ensures your coverage meets industry and contract requirements from day one.
2. Ignoring Environmental Risk Exposure
Pipeline work involves hazardous materials and environmentally sensitive areas. New contractors sometimes overlook the importance of environmental and pollution liability insurance, assuming incidents are unlikely.
In reality, even a minor spill or leak can result in cleanup costs, regulatory fines, and lawsuits.
3. Cutting Corners on Safety Programs
Skipping safety training to save money is a costly long-term mistake. Poor safety records lead to more injuries, higher workers’ compensation premiums, and difficulty securing future contracts.
Investing in safety training, PPE, and compliance with OSHA standards not only protects employees but also improves your insurance profile. Fewer claims often mean lower premiums and better carrier options over time.
4. Mismanaging Equipment and Vehicle Coverage
New contractors frequently underestimate how expensive equipment damage or vehicle accidents can be. Heavy machinery, trucks, and trailers represent major investments—and replacing them out of pocket can cripple a young business.
Commercial auto and contractor’s equipment insurance help protect against theft, accidents, and downtime. These coverages are often required on pipeline projects and are essential for business continuity.
5. Working Without Expert Guidance
Trying to navigate contracts, insurance, and compliance alone is risky. New contractors benefit greatly from working with professionals who understand the oil and gas industry.
At Wexford Insurance, we help new pipeline contractors nationwide avoid costly mistakes by designing insurance programs that protect income, assets, and future growth.
Starting strong matters.
Request a quote from Wexford Insurance today and build your pipeline business on a solid foundation.
