Construction Industry Insurance Guide

Insurance Essentials for Contractors

The construction industry faces unique and significant risks that require specialized insurance solutions. From jobsite injuries to property damage, equipment theft to contractual obligations, contractors need a comprehensive insurance program that addresses the full spectrum of exposures inherent in construction work.

General Liability for Contractors

General Liability is the cornerstone of any contractor's insurance program. It protects against third-party claims of bodily injury and property damage arising from your operations. For contractors, this includes coverage for completed operations—claims that arise after you've finished a job and left the site.

• Premises and operations liability for active jobsite incidents
• Products and completed operations coverage for post-project claims
• Personal and advertising injury protection
• Damage to property you're working on (with proper endorsements)
• Additional insured requirements for general contractors and property owners

Builders Risk & Installation Floater

Builders Risk insurance covers buildings under construction from damage during the construction process. This coverage protects the structure, materials, and fixtures from covered perils like fire, wind, theft, and vandalism. An Installation Floater provides similar protection for materials and equipment being installed at a jobsite.

Surety Bonds for Construction

Surety bonds are essential for contractors bidding on public projects and many private ones. Understanding the different types of bonds and how to qualify for them can open doors to larger and more profitable projects.

• Bid bonds guarantee you'll enter into a contract if awarded the project
• Performance bonds ensure you'll complete the project per contract terms
• Payment bonds guarantee you'll pay subcontractors and suppliers
• License and permit bonds satisfy state and local licensing requirements
• Maintenance bonds cover defects discovered after project completion

Managing Subcontractor Insurance

As a general contractor, you're often held responsible for the actions of your subcontractors. Implementing a rigorous subcontractor insurance verification process protects your business and ensures compliance with contractual requirements. Require certificates of insurance before any subcontractor begins work, and verify that their coverage meets your minimum requirements.

• Set minimum insurance requirements for all subcontractors
• Require additional insured status on their General Liability policy
• Verify workers compensation coverage for all sub employees
• Collect updated certificates before each project begins
• Use a tracking system to monitor certificate expiration dates