Contractor Insurance Questions, Answered

General contractor insurance is a package of coverages — typically general liability, workers compensation, tools & equipment, and bonds — built around the risks contractors face on the job: third-party injury, property damage, employee injuries, equipment theft, and contractual/licensing requirements.

General liability isn't always legally mandated, but most GCs, property managers, and permit offices require proof of it before you can work. Workers compensation is legally required in nearly every state the moment you have employees, regardless of trade.

It varies widely by trade, revenue, payroll, and claims history — typically $500–$8,000+ per year for general liability alone, with roofing and other high-risk trades at the top of that range. The only way to get an accurate number is a real quote.

General liability covers third-party claims — injury or property damage to someone who isn't your employee. Workers compensation covers your own employees' medical costs and lost wages if they're hurt on the job. Most contractors need both.

A COI is a document proving you carry active insurance coverage, often naming the GC or property owner as an additional insured. GCs require it before letting subs on-site to make sure liability doesn't fall entirely on them if something goes wrong.

Once your policy is active, most certificates can be issued same-day — this is often the single most time-sensitive request contractors have, especially when a GC needs proof before a start date.

A class code is a standardized classification — usually from NCCI or your state's rating bureau — that categorizes your business by the type of work you do. It's the primary driver of your workers comp rate and factors into general liability pricing too. See our full class code lookup page for details.

Your carrier assigns it based on your description of operations, cross-referenced against your state's rating bureau manual. Being specific and accurate about what work you actually do helps ensure correct classification.

You could overpay for years under a higher-risk code, or face a large additional premium bill at audit time if you were under-reporting risk. Getting it right at the start avoids both problems.

Yes, in many cases — some businesses are rated under multiple class codes with payroll split between them. This is common for handyman businesses and remodelers who also do specialty trade work.

Yes. General liability covers third-party claims, not damage to or theft of your own tools and equipment. Tools & equipment coverage (inland marine) is a separate policy specifically for your business-owned tools, machinery, and equipment.

A bond is a three-party guarantee — you promise to meet a contractual or licensing obligation, and the surety company backs that promise financially if you fail to. It's not insurance in the traditional sense (it protects the obligee, not you), but it's often required alongside your insurance policy.

The most common are license/permit bonds (required by your state or local licensing board), bid bonds (guaranteeing you'll honor a bid if awarded), and performance/payment bonds (guaranteeing you'll complete a project and pay your subs and suppliers).

Roofing carries one of the highest workers comp class code rates in construction because falls from height are the leading cause of severe and fatal construction injuries — carriers price that elevated risk directly into the premium.

Handyman businesses often perform a mix of trade work under one business, which some carriers struggle to classify correctly. We work with carriers that write handyman risk as its own category rather than forcing a single-trade box.

Yes, in most cases — this is one of the most common claim types general liability responds to for plumbers. Sublimits vary by carrier, which is why we make sure the policy we quote doesn't cap water damage claims too low.

It depends on whether you collected a certificate of insurance and additional insured endorsement from that subcontractor before they started work. Without it, a claim can land squarely on your own policy.

Completed operations coverage responds to claims that arise from work you finished in the past — a leak, a wiring issue, a structural problem discovered after you've left the job. It's especially important for electricians, plumbers, and remodelers.

Workers comp premiums are based on actual payroll, so seasonal swings (like HVAC's summer AC vs. winter heating seasons, or landscaping adding snow removal) are expected and reconciled at your annual audit — just report payroll accurately.

In most states, it's required the moment you have even one W-2 employee — thresholds vary by state, and a few states have exceptions for very small businesses or sole proprietors, so it's worth confirming your state's specific rule.

Yes — new businesses are insurable, though carriers may ask more detailed questions about your experience, licensing, and safety practices since there's no claims track record to reference yet.

If you or your crew drive vehicles for business purposes — hauling equipment, driving to job sites in a company truck — a personal auto policy typically won't cover business use. Commercial auto is a separate coverage worth adding to your program.

Your trade, an estimate of annual revenue and payroll, number of employees, years in business, and the coverage types you're interested in. Our multi-step quote form walks you through exactly this.

Yes, quotes are completely free and no-obligation. A licensed agent reviews your submission and follows up with real pricing — there's no pressure to purchase.