Contractor’s Liability Coverage

Knowing the Limitations of a Contractor’s Liability Coverage

When contractors bid for a construction job, the homeowner or business manager usually wants to know about the insurance coverage that will be maintained during the length of the project. They raise some good questions, one of which is usually “are subcontractors covered under contractors insurance?” If you are a contractor, you will need to have an answer for this area of liability, as it could make or break your ability to close the deal.

The Inclusions

Whether it is a job site injury from a falling board or inattentive operation of powerful equipment, the risky nature of contracting work can create substantial medical claims against the business. With general liability insurance, accidents and injuries that occur on the job site can be covered. However, the subcontractor will need to be listed as an additional insured on this policy to ensure the coverage is extended should an incident occur with a subcontractor.

The Exclusions

As indicated by the information found at, clients generally also want their contractors to carry a professional liability policy, to help with areas of errors and omissions. This could compensate the client in the event of a loss that occurs due to errors. However, subcontractors are not included in this form of coverage and would need to secure their own E&O insurance plan.

The best coverage is provided to the client when both contractors and subcontractors carry their own liability insurance policies. This would protect all parties involved, regardless of who or what is at fault.