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Accidents can happen on the construction site that results in bodily injuries or property damage to third parties and employees. Materials and equipment can also get lost or damaged.
Given the risk you are exposed to,you need general contractor insurance coverage, which comes in two types. This article will guide you on the cost of general contractors, the various policies and the various companies offering the policy.
General contractor insurance coverage cost $50 per month or $600 per year for a $1 million general liability policy.
Here’s a table that shows the cost of insurance policies that most general contractors purchase.
| Cost per Month | Cost per Year | Deductible | |
| General liability insurance | $50 | $600 | $0-$500 |
| Errors and omissions insurance | $70 | $840 | $500-$1,000 |
| Workers compensation insurance | $92 | $1,104 | $2,000-$5,000 |
| Commercial property insurance | $55 | $660 | $1,000-$2,000 |
| Commercial auto insurance | $65 | $780 | $500-$1,500 |
Similar to paving contractors, plastering contractors, and flooring contractors, you also need general liability insurance. General liability for general contractors grants a shield against the financial punches due to third-party property damage, bodily injury, and legal action.
A general contractor’s liability insurance takes care of these costs if a claim for bodily injury or property damage is filed:
| CoverWallet | NEXT (Best) | Thimble | |
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 |
| Aggregate limit | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000/$2,000,000 |
| Products and completed operations aggregate limit | $2,000,000 | $1,000,000 | $1,000,000 |
| Advertising injury coverage aggregate limit | $1,000,000 | $1,000,000 | $1,000,000 |
| Tenant’s legal liability coverage limit | $1,000,000 | $100,000 | $5,000 |
| Waiver of subrogation included? | Yes | No | Included |
| Hired/non-owned auto liability coverage included? | Yes | No | Excluded |
| Equipment breakdown floater included? | No | Yes | Yes |
| Can you get a certificate of insurance online? | Yes | Yes | Yes |
| Name additional insureds? | Yes | Yes | Yes |
| Deductible | $0 | $0 | $0 |
Your clients can sue and hold you liable for negligence, mistakes, and omissions. You can also be responsible if these are committed by EIFS contractors and other contractors you hired.
Claims filed because there are issues with your services aren’t covered by general liability insurance. And so, you must get another general contractor insurance coverage-errors and omissions insurance.
| CoverWallet (Best) | NEXT | Thimble | |
| Per occurrence limit | $1,000,000 | $300,000/$1,000,000 | $1,000,000/$2,000,000 |
| Aggregate limit | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000/$2,000,000 |
| Name additional insureds? | Yes | Yes | Yes |
| Waiver of subrogation included? | Yes | No | No |
| Deductible | $500 | $500 | $500 |
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Your office and warehouse can get damaged or destroyed. Commercial property insurance recovers losses quickly without any interruptions.
This compensate your financial losses if the office or warehouse gets damaged or destroyed by:
The coverage of commercial property insurance for general contractors, plumbing contractors, and door installation contractors also applies to what’s inside the building too.
And so, this insurance will also compensate for the value of equipment, materials, and other valuables that got damaged or lost.
| CoverWallet | NEXT (Best) | Thimble | |
| Building coverage limit (minimum) | $50,000 | $310,000 | $25,000/$500,000 |
| Contents coverage limit (minimum) | $50,000 | $31,000 | $25,000/$500,000 |
| Outdoor signs | Excluded | $2,500 | Excluded |
| Accounts receivable | Excluded | Excluded | $5,000/10,000 |
| Money and securities | Excluded | $2,500 | $1,000 |
| Lock and keys | Excluded | $2,500 | Excluded |
| Business interruption floater | Excluded | Included | Included |
| Equipment breakdown floater | Excluded | Included | Excluded |
| Inland marine insurance floater | Excluded | Excluded | $10,000 |
| Employee dishonesty floater | Excluded | $5,000 | $2,500 |
Tools and equipment insurance solely covers the equipment you use as a general contractor as well as the personal implements of employees.
Tools and equipment insurance for general contractors, electrical contractors, and masonry contractors covers the repair or replacement costs of drills, hammers, ladders, portable lights, lifters, and other tools and equipment that get damaged or lost because of:
| NEXT (Best) | Thimble | Travelers | |
| Aggregate limit | $5,000/$10,000 | $1,000/$5,000 | $15,000/$25,000 |
| Offered as an endorsement to general liability insurance? | Yes | Yes | No |
| Covers hired and borrowed equipment? | Yes | Yes | No |
| Miscellaneous equipment also covered? | Yes | No | No |
| Deductible | $500 | $500 | $1,000 |
Commercial auto insurance is important if you’re a general contractor who owns or hires flatbed trucks, dump trucks, and other vehicles to haul materials, transport debris, and take employees to different project locations.
You need commercial auto insurance for general contractors, fence installation contractors, and roofing contractors in case something happens to the vehicles you use for business operations.
| NEXT (Best) | Progressive | GEICO | |
| Auto liability bodily injury coverage aggregate limit (minimum) | $25,000 per injury$50,000 per accident | $25,000 per injury$50,000 per accident | $100,000/$300,000 CSL |
| Auto liability property damage aggregate limit (minimum) | $15,000 | $15,000 | $50,000 |
| Uninsured/underinsured motorist coverage limit | $25,000 per injury $50,000 per accident | $25,000 per injury $50,000 per accident | $100,000/$300,000 |
| Rental reimbursement coverage aggregate limit | $1,500 | $1,500 | $900 |
| Trailers can be added to commercial auto insurance? | Yes | Yes | Yes |
| Roadside assistance coverage included | Yes | Yes | No |
| Safe driving discounts included? | Yes | Yes | Yes |
General Contractor Workers Compensation Insurance
It’s a requirement in most states.Workers’ compensation insurance kicks in when a full-time or part-time employee sustains an occupational disease or injury. It will take care of these costs on your behalf:
Note that workers’ compensation for general contractors doesn’t apply to sub-contractors you hire for carpentry or drywall work.
Aside from the insurance policies we mentioned above, you might also need to get certain types of bonds. This is because some clients might require you to get both general contractor insurance coverage and bond for high-profile projects.
The most useful types of general contractor bond insurance are surety and fidelity bonds. A surety bond indemnifies the losses of a client in case you can’t finish or fail to finish a project. On the other hand, a fidelity bond reimburses the losses if your employee commits a crime.
General contractor bonded and insured find it easier to bid and close projects. There are also lesser problems with getting a license to commence projects.
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These are the best general contractor insurance companies. Read to know their pros, cons, and pricing for a $1 million general liability insurance.
NEXT is a one-stop shop for small general contracting businesses looking for:
All of the policies above are offered in NEXT’s deluxe general contractor insurance program. You get comprehensive coverage and a 10% discount by bundling different insurance policies.
The basic coverage only offers a general liability and errors and omissions insurance with a $1 million per occurrence and aggregate limit. Note that your general contractor insurance from NEXT is offered in partnership with Tivly®.
Average cost: $42 per month
CoverWallet is an insurance broker that sells the general liability insurance, commercial auto, workers’ compensation, commercial property, and other business insurance policies of its partners for general contractors.
To get covered, you can use CoverWallet’s online quotes comparison tool which shows the rates and features of numerous insurance options. You can then decide to get covered online or talk with an agent over the phone.
Average cost: $44 per month
Tivly® works with NEXT for its general contractor insurance coverage, which offers general liability, workers’ compensation, commercial auto, builders risk, and other policies. Progressive and GEICO might refer you to this company if they can’t provide coverage.
Average cost: $42 per month
You can get covered through its contractors’ insurance plan which consists of general liability and workers’ compensation insurance.
Thimble’s general liability insurance is available as a short-term and long-term coverage.
On the other hand, the short-term general liability insurance of Thimble provides basic coverage. However, what makes it great is that you can decide to get covered for only hours, weeks, days, or months.
Average cost: $48 per month
Since 1935, State Farm has been offering small businesses, including general contractors, affordable and customizable policies that promise to meet all your business needs.
This company offers the following:
Average cost: $50 per month
GEICO has evolved to be one of the largest insurance carriers. GEICO is perfect for policyholders looking to handle their own general contractor insurance coverage.
It is important to note that GEICO doesn’t underwrite a lot of its insurance products. Instead, it partnered with affiliated companies that provide coverage for clients.
Average cost: $52 per month
Progressive’s basic cover includes general liability coverage and commercial auto insurance. You can include additional coverage options, including:
Average cost: $55 per month
Travelers goes as far back as 1864 and has since acquired an A++ rating from AM Best. This company doesn’t issue a quote.
It’s because most of its insurance policies are highly specialized and include provisions that a representative has to explain for you to fully understand.
Average cost: $56 per month
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Disclosure: Insuranks.com is an independent educational comparison service and an advertising-supported publisher. Some of the companies/offers that appear on the website are from our partners which we may receive compensation from. This may influence which companies/offers we write about and where and how it appears on the site. However, this does not impact our assessments. We solely highlight companies, products, and offers that can help you make smarter insurance decisions.
