General Contractor Insurance: Cost & Quotes From $13/month

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Accidents can happen in the construction site that result in the bodily injuries or property damage of third parties and employees. Materials and equipment can also get lost or damaged. 

Given the risk you are exposed to, you ought to invest in general contractor insurance, which comes in two types. This protects your business from potential lawsuits and other claims. Contractors taking on commercial builds need commercial general contractor insurance, while those involved in residential projects will require residential general contractor insurance.

It might even be hard to bid for contracts if you don’t have adequate general contractor insurance coverage. So by getting insured, you are also helping your business grow. Read this guide to know:

• How much general contractors pay for insurance

• The function of each kind of general contractor insurance policy

• Where to get the best coverage as a general contractor

General Contractor Insurance Cost 

Here’s a table that shows the cost of insurance policies that most general contractors purchase. 

General contractor insurance cost $50 per month or $600 per year for a $1 million general liability policy. This estimate of the cost of general liability insurance for general contractors assumes that you have 5 employees and make $500,000-$750,000 revenue per year. Get cheap general contractor insurance by:

• Having high deductibles

• Bundling two or more insurance policies

• Removing floaters if they’re useless

• Comparing quotes 

• Avail commercial auto discounts for safe driving

Another way to determine the average cost for general contractor insurance is to take a look at how much insurance companies charge. Here’s a table showing the rates of the recommended general contractor insurance companies:

General Contractor General Liability Insurance

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. Use the table above to compare the quotes of general liability insurance for general contractors.

About 98% of general contractors get general liability insurance. Here are some example situations where your general contractor liability insurance coverage becomes useful:

• A dump truck runs over someone while it’s exiting the construction site

• An inspector falls from a height while checking the structures of the site

• An independent contractor gets electrocuted while installing lighting and wiring for your construction project

• Representatives of your client slip and fall on the premises of the construction site during a tour

So how does general liability insurance work? A general contractor’s liability insurance takes care of these costs if a claim for bodily injury or property damage is filed:

• Medical treatments

• Reimbursements for property damage

• Settlements

• Defense costs

• Court judgments

Note that most insurance providers underwrite general contractor general liability insurance comprehensively. Aside from bodily injuries or property damage, the policy can also cover these exposures:

• Loss or damage of a client’s property under your care, custody, and control

• Bodily injuries or property damage because of defective work (product liability claims)

• Fire and water damage to a landlord’s property

• Claims for slander, libel, and copyright infringement

Errors And Omissions Insurance For General Contractors

All 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.

Use the table above to compare the quotes of errors and omissions insurance of carriers that sell general contractor insurance online.

Errors and omissions insurance for general contractors takes care of costs if a client files a claim because you:

• Inflated the cost of construction materials and your services

• Failed to perform a particular task mentioned in the contract

• Left the project unfinished in order to cater to more important projects

• Hired the wrong subcontractors for the job

You have two options for errors and omission insurance-claims made or occurrence. Go for the second because it provides lifetime coverage.

Commercial Property Insurance For General Contractors 

Your office and warehouse can get damaged or destroyed.  

Commercial property insurance recovers losses quickly without any interruptions. Use the table above to compare the quotes of commercial property policy from some of the best insurance companies for general contractors. 

79% of general contractors get commercial property insurance. This reimburses your financial losses if the office or warehouse gets damaged or destroyed by:

• Fire

• Theft

• Vandalism

• Civil commotion

• Riot

• Sinkhole collapse

• Volcanic action

• Lightning

• Winds

• Snow

• Hail

• Rain

• Falling objects

• Aircraft

• Vehicle

• Impact

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 reimburse the value of equipment, materials, and other valuables that got damaged or lost while in the warehouse or office due to fire, theft, vandalism, and other perils we mentioned above. 

Similar to general liability insurance, commercial property insurance comes with add-ons. Additional coverages you’ll find included it are:

• Equipment breakdown floater

• Business interruption floater

• Inland marine floater

Tools And Equipment Insurance For General Contractors

Tools and equipment insurance solely covers the equipment you use as a general contractor as well as the personal implements of employees. 

This is sold as a stand-alone policy or as an optional coverage in general liability insurance. Use the table above to compare the quotes of tools and equipment insurance for general contractors. 

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:

• Fire

• Theft

• Vandalism

• Impact

• Explosions

• Operator error

• Water

• Mysterious disappearance

Commercial Auto Insurance For General Contractors

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. 

Use the table above to compare the quotes of commercial auto insurance for general contractors. 

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. Here’s a summary of this insurance policy’s main functions:

• Cover the medical treatment or property damage of third parties who get involved in an accident caused by your commercial vehicle

• Pay for parts repair or replacement if your commercial vehicle gets damaged because of a collision, fire, theft, vandalism, or weather

• Cover the medical treatment of your commercial vehicle’s passenger or driver in case of accidents caused by an underinsured/uninsured motorist

General Contractor Workers Compensation Insurance 

If you hire additional help or specialized skills to help with the completion of a project, a sound risk management practice you should have in place is general contractor workers' compensation insurance. 

Other than protecting your business from the cost of employee claims for a workplace injury or illness, get this policy because it’s a requirement in most states. Failure to get general contractor workers comp insurance will result in hefty fines and penalties.  

About 100% of general contractors purchase workers compensation insurance. 

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:

• Lost wages 

• Death benefits

• Medical bills arising from accidents on-site or in the workplace 

• Retraining and rehabilitation

• Medication

• Hospitalization

Note that workers' compensation for general contractors doesn’t apply to sub-contractors you hire for carpentry or drywall work. 

General Contractor Umbrella Insurance 

Construction work carries a variety of inherent risks that you can never thoroughly plan for or financially protect yourself against. Fortunately, you can purchase general contractor umbrella insurance. 

This general contractor business insurance provides you with an additional layer of coverage beyond the policy limits of your general contractor liability policies. 

This means that if your business was to cause damages that exceed the limits of your commercial general liability policy, commercial auto, or errors and omissions policy, the umbrella policy for general contractors, concrete contractors, and siding installation contractors caters to the excess. 

General Contractor Insurance And Bond 

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 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.