What Does Contractors Insurance Not Include?

Contractors holding blueprints

Every contractor needs a commercial general liability insurance policy to protect company assets and reduce liability risks. Commonly known as contractors insurance, a construction general liability policy can protect your contracting business against liability for injuries, accidents, and property damage. Proof of this type of insurance is required for many jobs for both contractors and subcontractors.

What Kinds of Coverage Does Contractors Insurance Provide?

A construction general liability insurance policy (contractors insurance) can provide protection against various types of claims, including:

  • Property damage: This coverage applies in the event your company causes damage to a customer’s property.
  • Bodily injury: Contractors insurance covers medical expenses and court-awarded damages for injuries to others (besides the contractor and its workers) resulting from negligence.
  • Product claims: This insurance also covers claims related to damages caused by equipment your company installs.
  • Accidental advertising injuries: If your company slogan or advertising campaign is similar to a competitor’s, you could be sued for copyright infringement. If someone considers your advertising to be libel or slander, you could be facing a lawsuit for defamation. Commercial general liability insurance can cover any associated costs.

What Is Not Covered By Contractors Insurance?

Commercial general liability insurance provides coverage for basic contractor risks, but it does not offer complete protection. To fully protect your business, consider adding the following types of coverage to your business insurance package:

  • Workers’ compensation insurance: Employers in most states are required to carry workers’ compensation insurance to protect their employees in case of work-related injuries. Workers’ comp covers injured employees’ medical expenses, partially reimburses them for lost wages, and protects employers from personal injury lawsuits filed by employees. Commercial general liability insurance does not apply if you or one of your workers is injured.
  • Commercial auto insurance: This insurance covers vehicles owned by your contracting business. It provides protection in the case accidents in which company vehicles are involved and protects against property damage related to theft, vandalism, and weather.
  • Builder’s risk insurance: This coverage kicks in when damage from fire, vandalism, or a covered peril occurs while a building is still under construction.
  • Professional liability insurance: This insurance covers you in case of professional oversights and mistakes, such as missing a project deadline.
  • Contractor’s tools and equipment insurance: If your tools or equipment are lost, stolen, or damaged, this insurance will help cover the cost of their repair or replacement. Commercial general liability insurance will cover damage to the property of others caused by your company and employees, but it will not cover damage to or loss of your company’s own property.

Construction is a demanding industry with a high risk of jobsite injuries and other liabilities. Contractors insurance can help protect your business from lawsuits and claims for damages during the construction process. However, it will not provide all the coverage you need to protect your business entirely. Our knowledgeable agent will be happy to work with you to create a complete contractors business insurance package that meets your company’s needs at the best available rates.

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