Companies, for example those in the IT and construction industry, have a lot of tasks. And to meet deadlines, they hire subcontractors. When applying for work as a subcontractor, insurance is required as a protection against third party liabilities, worker injuries, and occurrence of default. This is why you need to have a comprehensive subcontractor insurance program.
Subcontractor insurance can cover lawsuits, employee injuries, and pay for the repair or replacement of rented/borrowed heavy equipment. This guide takes you through some of the most important factors to consider when looking at subcontractor insurance and how much it costs. Comparing insurance quotes is the best way to get a good deal on insurance, this is why we’ve also included some reviews of the best companies.
Let’s answer this question first - As a subcontractor do I need insurance? Subcontractors should be insured to enjoy protection against liability issues and other concerns. Not only does the right insurance protect the subcontractor, but it also ensures the business working with them is protected too.
If a subcontractor is not insured, it could bear the liabilities for anything that might happen during the project. Uninsured subcontractors also leave themselves at risk, with no protection from the company they are working with.
Coverage can be enjoyed by including a clause in the subcontractor insurance agreement that compels the employer to name additional insureds. However, this is a practice that’s not observed all the time. And so, subcontractors need to have their own insurance coverage underwritten by a commercial insurance company or by the insurance agency funded by the state.
State laws don't require subcontractors to get insured before getting hired. But here’s the catch, those who wish to get hired must carry specific types of insurance that most employers will demand.
The first is liability coverage. Liability insurance grants protection against third party claims for negligence, bodily injuries, property damage, and personal injuries. Of course, workers must enjoy protection. And so, workers compensation insurance for subcontractors is important. There are also other types of insurance that might be useful.
Subcontractor liability insurance is one of the important types of insurance you can benefit from. Insurance companies offer this as a general liability policy or professional liability policy.
| CoverWallet | NEXT (Best) | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $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 | $300,000/$2,000,000 | $1,000,000/$2,000,000 |
| Products and completed operations aggregate limit | $2,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
| Advertising injury coverage aggregate limit | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
| Tenant’s legal liability coverage limit | $100,000 | $100,000 | $5,000 | $100,000 | $1,000,000 |
| Waiver of subrogation included? | Yes | No | Included | Can be included | No |
| Hired/non-owned auto liability coverage included? | Yes | No | Excluded | Can be included | Can be included |
| Equipment breakdown floater included? | No | Yes | Yes | Can be included | Can be included |
General liability insurance provides protection against lawsuits that result from third-party bodily injury, property damage, and advertising injury. Although this type of insurance isn't necessarily a legal requirement, many contractors won't work with subcontractors who don't have their own general liability insurance.
Many different types of subcontractors can benefit from having general liability insurance. Whether you work in construction, marketing, IT, or any other area, this type of subcontractors insurance can protect you.
Most insurance companies design their subcontractors insurance package to primarily offer a general liability policy. Other policies can then be added at the perusal of the policyholder. Use the table above to see which insurance company offers the best general liability insurance for subcontractors.
General liability insurance can cover the cost for medical treatment, reimbursement for property damage, or legal expenses if these things happen:
A scaffolding or any other structure collapsed at the construction site and injured the pedestrians nearby
A subcontractor was using a heavy equipment and caused some damage to the construction project by accident
The subcontractor damaged an equipment owned by his employer
The employer filed a lawsuit after discovering that a subcontractor has posted malicious remarks about his company online
There are a few ways subcontractors might be covered by a general liability insurance policy. They could be added to the policy of the main contractor or the client who is hiring them. Additionally, subcontractors can take out their own general liability insurance to protect them when they're working. Being able to provide a certificate of insurance to the head contractor or employer will benefit subcontractors when they are trying to secure projects.
When it comes to businesses ensuring subcontractors are adequately insured, they might ask subcontractors to show a certificate of insurance. One of the subcontractor agreement insurance requirements, a certificate of insurance provides a glimpse on how much general liability coverage is available, what endorsements to the policy are included, and if there are any existing additional insureds.
A general liability insurance audit is intended to take a close look at a business's payroll and risk exposure. An audit ensures you are paying the correct amount for your insurance and getting the coverage that you need.
The audit may be required by your insurance provider at the end of the year to ensure you paid enough in insurance premiums. General liability insurance audit subcontractors will look at several different things, including your business's gross sales, any changes from the prior year, and employees or independent contractors.
Providing accurate information and related paperwork about subcontractors can help the audit to go smoothly.
| CoverWallet (Best) | NEXT | Thimble | Hiscox | The Hartford | |
|---|---|---|---|---|---|
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $1,000,000 |
| Aggregate limit | $2,000,000 | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000/$2,000,000 | $2,000,000 |
| Name additional insureds? | Yes | Yes | Yes | Yes | Yes |
| Waiver of subrogation included? | Yes | No | Yes | Yes | No |
| Deductible | $500 | $500 | $500 | $500 | $500 |
Another type of sub contractor insurance that many subcontractors and businesses consider is professional liability insurance. This is also known as errors and omissions insurance and is designed to protect against liabilities that result from the occurrence of issues at work.
Subcontractors may not be covered if the contractor or business hiring them is faced with a professional liability lawsuit, so subcontractors are often required to have this type of insurance before they can win work. Use the table above to see which insurance company offers the best professional liability insurance for subcontractors.
Professional liability insurance for subcontractors will grant protection if an employer accuses you of committing the following:
Missed deadlines
Mistakes
Breach of confidentiality
Intentionally leaving work without the intent of returning to finish it
Losing blueprints or any other document integral for the completion of the project
Negligent hiring
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| CoverWallet | NEXT (Best) | Thimble | The Hartford | Hiscox | |
|---|---|---|---|---|---|
| Building coverage limit (minimum) | $50,000 | $340,000 | $25,000/$500,000 | $35,000 | $25,000 |
| Contents coverage limit (minimum) | $50,000 | $35,000 | $25,000/$500,000 | $35,000 | $15,000 |
| Outdoor signs | Excluded | $2,500 | Excluded | Excluded | Included |
| Accounts receivable | Excluded | Excluded | $5,000/$10,000 | Excluded | Included |
| Money and securities | Excluded | $2,500 | $1,000 | Excluded | Included |
| Lock and keys | Excluded | $2,500 | Excluded | Excluded | Included |
| Business interruption floater | Excluded | Included | Included | Excluded | Included |
| Equipment breakdown floater | Excluded | Included | Excluded | Excluded | Included |
| Inland marine insurance floater | Excluded | Excluded | $10,000 | Excluded | Excluded |
| Employee dishonesty floater | Excluded | $5,000 | $2,500 | Excluded | Excluded |
Commercial property insurance protects the building or business equipment you own as a subcontractor. This type of construction subcontractor insurance policy allows you to recover in case theft, fire, vandalism, riot, and other covered perils happen. Use the table above to see which insurance company offers the best commercial property insurance for subcontractors.
Sometimes commercial property insurance comes with a business interruption policy that may grant subcontractor income protection. The business interruption inclusion allows commercial property insurance to reimburse a portion of lost income in case you need to stop doing business because of an economic problem, relocation, renovation, or any other covered peril.
Most likely not. Commercial property insurance will only cover equipment within your business premises. Equipment under the custody of the client aren’t covered unless an inland marine inclusion is included in the terms of commercial property insurance.
| CoverWallet | NEXT (Best) | Thimble | The Hartford | Hiscox | |
|---|---|---|---|---|---|
| General liability aggregate limit | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000/$2,000,000 | $1,000,000/$2,000,000 | $300,000/$2,000,000 |
| Commercial property coverage limit | $50,000 | $340,000 | $25,000/$500,000 | $35,000 | $75,000 |
| Optional policies can be added? | Yes | Yes | Yes | Yes | Yes |
| Name additional insureds for free? | Yes | Yes | Yes | Yes | Yes |
| BOP discount? | Yes | Yes | Yes | Yes | Yes |
Consider getting a business owner’s policy (BOP) if you don’t have a lot of budget on insurance but still want to enjoy comprehensive coverage. A business owner’s policy is a combination of general liability insurance and commercial property insurance That said, you can use this to cover liability claims and commercial losses.
Some insurance companies allow you to further enjoy other types of insurance by getting a BOP. Some common add-ons are tools and equipment insurance, and inland marine insurance. Use the table above to see which insurance company offers the best business owner’s policy for subcontractors.
| NEXT | Thimble | Hiscox | |
|---|---|---|---|
| Aggregate limit | $3,000/$10,000 | $2,500/$5,000 | $15,000/$25,000 |
| Covers hired and borrowed equipment? | $3,000/$10,000 | $2,500/$5,000 | No |
| Miscellaneous equipment also covered? | $5,000/$10,000 | No | Yes |
| Offered as an endorsement to general liability insurance? | Yes | Yes | Yes |
| Deductible | $500 | $500 | $0 |
Tools and equipment insurance will cover the unexpected costs for repair or replacement if drills, ladders, and other precious items for work get lost or damaged by theft, vandalism, breakdown, and other covered perils. Use the table above to see which insurance company offers the best tools and equipment insurance for subcontractors.
Businesses need to take out workers' compensation insurance for their employees but may be unsure about whether it's necessary for contractors and subcontractors. Workers compensation for subcontractors is often required by employers, and it may be left to the subcontractor to arrange it. On some occasions, an employer or contractor might add the subcontractor to their own workers' compensation insurance policy.
The employer’s workers' compensation insurance might not apply to a subcontractor’s employees unless stated in a document expressing otherwise. And so, if you have your own workers, then it’s a good idea to get your own workers comp insurance for subcontractors.
A workers comp policy is one of the most costly general contractor insurance requirements for subcontractors. Nonetheless, investing in it is worth the trouble. The failure to get workers comp insurance can result in an injunction, a fine, a stop-hold order, or any other punishment as may be prescribed by labor laws.
Employer’s liability insurance for subcontractors will cover costs if an employee sues for a work-related injury or disease. With this, you can pay legal costs and settlements. Minimum limits start at $500,000 for each employee injury by disease or accident. The employer's liability policy in subcontractor roofing insurance programs is often included in workers' compensation packages so that it doesn't need to be purchased separately.
Commercial auto insurance is a coverage for the truck, van, or any other vehicle you own as a subcontractor. This policy will cover the cost of accidents, injuries to the driver and the passengers, and any damage to the covered vehicles. Up to four vehicles can be insured in a commercial auto policy.
You’re a subcontractor. Nonetheless, it’s possible for you to hire other subcontractors to get the project done. Consider purchasing subcontractor default insurance to protect yourself in case something happens that will cause the company you hired to default.
Subcontractor default insurance will grant a reimbursement in case the subcontractor you hired can’t finish the project due to manpower issues, supply chain issues, or any other covered cause. By having this you can reduce any resulting financial losses and keep your client’s trust even if an issue happens.
| Cost per Month | Cost per Year | Deductible | |
|---|---|---|---|
| General liability insurance | $46 | $552 | $0-$500 |
| Professional liability insurance | $51 | $612 | $500-$1,000 |
| Commercial property insurance | $120 | $1,440 | $1,000-$2,000 |
| Business owner's policy | $166 | $1,992 | $1,500 |
| Commercial auto insurance | $60 | $720 | $500-$1,000 |
| Workers compensation insurance | $90 | $1,080 | $1,000-$2,500 |
| Business interruption insurance | $55 | $660 | $500-$1,000 |
The average subcontractor insurance cost is $46 per month or $552 per year for a $1 million general liability insurance. Consider doing these to enjoy cheap general liability insurance for subcontractors:
Get high deductibles
Bundle general liability insurance with other policies to enjoy a discount
Pay the premium for the whole year rather than going for a monthly scheme
Exclude floaters to general liability insurance if they're useless
Costs for subcontractor insurance can vary depending on your needs. Comparing subcontractor insurance quotes is the best way to find out how much you could be paying. It's also important to carry out audits to make sure you are paying the right amount and have the necessary coverage. The table below further shows the general liability insurance rates for subcontractors as charged by the insurance companies we recommend.
| Cost Per Month | Cost Per Year | Best for: | |
|---|---|---|---|
| NEXT | $35 | $420 | Best overall; Fastest general liability insurance for subcontractors |
| CoverWallet | $37.43 | $449.16 | Subcontractor insurance online quotes comparison |
| The Hartford | $39 | $468 | Workers compensation insurance for subcontractors |
| Tivly | $40 | $480 | Comparing subcontractor insurance quotes over the phone |
| Hiscox | $42 | $504 | Short-term coverage for subcontractors |
| Thimble | $44 | $528 | Subcontractor insurance with automatic renewal |
The best way to get the best subcontractor liability insurance cost is to compare quotes and find out what different policies can offer you. Start by clicking the “Get Quotes” button on this page.
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Here are some of the best subcontractor insurance companies. Read to know their pros, cons, and rate for a $1 million general liability policy.
Best overall
Get an online proof of insurance and send as a text message, email, or social media post
Fastest general liability insurance for subcontractors
Great customer service and reputation
Issues an online proof of insurance instantly
Outstanding value for money
Bundle two or more insurance policies and get a 10% discount
Couldn’t find any
NEXT is an insurance company that offers a 100% digital insurance experience. Subcontractors, who wish to get covered, only need to use NEXT’s online quotation platform to choose the policies needed. Talks with agents aren’t required. Nonetheless, NEXT has a dedicated team of agents immediately available if you decide to call.
Your subcontractor insurance policies are offered under NEXT’s contractor insurance package. Here are what you’ll initially enjoy:
$1 million-$2 million general liability insurance
$1 million professional liability insurance
$340,000 commercial property insurance
$2,500-$5,000 tools and equipment insurance
Commercial auto insurance
Workers compensation insurance
Business owner’s policy
Best for: Best overall; Fastest general liability insurance for subcontractors
Average cost: $35 per month
Our rating: 10/10
Compare quotes online
Covers contractors with specialized services
Cancel your coverage anytime without charges
Terrorism coverage can be added to general liability insurance
Not an insurance company but an insurance broker
CoverWallet is an insurance broker. It’s a good option if you want to take a look at the available offers before getting covered. By using CoverWallet’s quotes comparison tool, you can take a look at the subcontractor insurance policies underwritten by its partners. Here are the policies you can avail from CoverWallet:
$1 million-$2 million general liability insurance
$1 million professional liability insurance
$25,000-$50,000 commercial property insurance
Workers compensation insurance
Commercial auto insurance
Business owner’s policy
Best for: Subcontractor insurance online quotes comparison
Average cost: $37.43 per month
Our rating: 10/10
Claims processes are fast and easy
Fair rates
Number 2 best company for workers comp insurance in 2021
Has insured a million small businesses
Possible premium hikes after submitting a claim
The Hartford offers coverage for greenhorn and highly established subcontractors. You can purchase insurance online or with the help of an agent. Moreover, you can enjoy extended coverage limits in case you’re a subcontractor with a highly demanding business profile. Note that The Hartford doesn’t sell a generic subcontractor insurance package. You have to specify your work before getting an online quote. Here are the features of the policies available:
$1 million-$2 million general liability insurance
$1 million professional liability insurance
$35,000 commercial property insurance
Commercial auto insurance
Employee benefits insurance
Workers compensation insurance
Best for: Workers compensation insurance for subcontractors
Average cost: $39 per month
Our rating: 10/10
Responsive customer service
Compare insurance quotes for phone stores over the phone
A partner of many reputable insurance companies
You need to call to get a quote
Consider Tivly if you consider talking with someone before getting covered. This company, with its insurance representatives, can help you find the best deals by comparing quotes over the phone. Your coverage from Tivly may come from Progressive, Gallagher, and other partners. Get started by calling a Tivly representative over the phone.
Best for: Comparing subcontractor insurance quotes over the phone
Average cost: $40 per month
Our rating: 9/10
Quick to issue an estimate of your rates
Has high TrustPilot ratings
Temporary insurance is available
You can’t reach customer service by calling
Another insurance company that offers a fully digitalized experience when it comes to insurance is Thimble. This company grants coverage to subcontractors specializing in roofing, carpentry, and other related industries. Here’s a quick summary of what you can avail from Thimble:
$1 million-$2 million general liability insurance (available as a short-term coverage)
$1 million-$2 million professional liability insurance
$25,000-$250,000 commercial property insurance
$2,500 tools and equipment insurance
Workers compensation insurance
Commercial auto insurance
Best for: Short-term coverage for subcontractors
Average cost: $42 per month
Our rating: 9/10
Upgrades can be added for better coverage
Reasonably priced upgrades
Automatic policy renewal
Worldwide coverage
Online quoting may not be available sometimes due to periodic site maintenance
Hiscox offers insurance policies that satisfy most contract requirements. The company meets this claim by designing insurance products that have customizable limits and add-ons. For example, a general liability policy from this company can have as little as $300,000 coverage or as hefty as $1 million. And in case some policies you need aren’t available in-house, Hiscox will tap its partners to grant coverage.
Best for: Subcontractor insurance with automatic renewal
Average cost: $42 per month
Our rating: 9/10
Subcontractors without insurance could cause problems for themselves and their clients. It's important to have a subcontractor insurance agreement and work out the specifics of who is responsible for different types of insurance. Compare quotes by clicking the “Get Quotes” button on this page and know the best options.
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!
It really can't get any better than this... wow
Not all those who wander are lost.
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