What Insurance Do I Need as a Subcontractor?
Subcontractor insurance needs can vary depending on the type of work you do and if you have any employees. While each subcontractor is different, we usually recommend the following policies:
General Liability Insurance for Subcontractors
General liability insurance — also known as commercial general liability (CGL) insurance — covers you and your business in case of third-party damages, accidents, and/or lawsuits. For example, if you accidentally shatter a customer’s bay window with your ladder, you won’t have to pay for the damages out-of-pocket because your policy will cover them.
Many companies won’t work with subcontractors if they don’t have general liability insurance, so it’s a good idea to have this protection in place.
General liability insurance usually covers:
- Bodily injury
- Third-party property damage
- Personal and advertising injury
- Medical expenses
- And more
General liability insurance usually does not cover:
- Damage to your own property
- Professional services
- Workers compensation or injury to your employees
- Known claims or potential claims
Learn more about General Liability Insurance.
Contents Coverage for Subcontractors
Like most subcontractors, you’ve probably spent a lot of money building up your tools and equipment inventory.
But what would happen if any of it were stolen or damaged?
That’s where contents coverage comes into play. This type of policy can come in handy for subcontractors, as it can cover your tools and equipment up to a certain amount. If you store your tools at home, you’ll need this policy, as your homeowners insurance won’t cover commercial equipment if it’s damaged or stolen.
Contents coverage can be added to your general liability insurance policy, so make sure to add it to yours!
Workers Compensation Insurance for Subcontractors
If you have employees, you’ll likely need workers compensation insurance. That’s because it’s usually a legal requirement, plus most contractors won’t hire you if you don’t have it.
Here’s how it works: If an employee gets injured on the job, workers comp insurance can cover resulting medical costs and lost wages. If the employee needs rehab or has ongoing medical costs, your policy can continue to provide coverage.
Carrying workers compensation can provide much-needed security, as having this coverage prevents an employee from suing your subcontracting business for workplace injuries.
Workers compensation insurance usually covers:
- Medical payments
- Lost wages
- Rehabilitation expenses
- Death benefits