Insurance for General Contractors

Most general contractors need at minimum: commercial general liability insurance (typically $1M/$2M), workers' compensation (if you have employees), and commercial auto (if you have company vehicles). Most commercial projects also require a commercial umbrella, and large projects often require builder's risk insurance. The specific requirements will be spelled out in your contracts.

As a GC, you face liability for work performed by your subcontractors if they cause injury or damage. Your GL policy covers your own operations, but you should require all subs to carry their own GL and workers comp with adequate limits and to name you as an additional insured. Your policy should also include 'subcontracted work' as a covered operation. Failure to properly manage sub insurance requirements can expose you to uninsured losses.

GCs face broader liability exposure because they are responsible for the overall project, the job site, and coordinating multiple trades simultaneously. They are often named defendants in construction defect claims even for work performed by subcontractors. Larger payrolls, larger project values, and greater overall exposure all contribute to higher premiums. As a GC, having a clean claims history and strong subcontractor vetting practices are the best ways to manage costs.

Completed operations is a component of your general liability policy that covers claims arising from work you completed — meaning the incident occurs after the job is finished. Construction defect claims often surface months or years after a project is complete. A 'Completed Operations' extension on your GL ensures you're protected for those delayed claims, which are extremely common in residential and commercial construction.