Contractor Liability insurance

Region: Ontario Answer # 1983

What is Contractor Liability insurance?

Contractor General Liability insurance protects general contractors against lawsuits or claims arising from property damage and bodily injury that may occur on a construction job. The insurance covers construction areas and projects under the care, custody and control of the general contractor. The insurance covers claims and judgment or settlement costs that may occur during the project, as well as after the project is completed.

In many cases, such as with government contracts, the general contractor is required to show proof of insurance before their bid is accepted, and subcontractors may be required to show their own liability insurance before beginning work.

Before beginning construction, property owners should ensure that both they and the general contractor have the right type and amount of insurance coverage, including:

Types of coverage

  • Bodily Injury coverage includes medical expenses that were incurred due to an injury on the job.
  • Property Damage coverage pays for damages to a property caused by the contractor (or its employees, subcontractors etc.), and could include damage to buildings, vehicles and pets.
  • Product / Equipment coverage is for damages where equipment or products installed by the contractor malfunction or are not installed properly.

Who needs Contractor Liability insurance?

Contractors Insurance can be purchased by:

  • general contractors,
  • subcontractors, and
  • property owners who are acting as their own general contractor on a construction project.

Contractor liability insurance is needed primarily by the general contractor. However, subcontractors should also maintain their own coverage. If the subcontractor does not have insurance of their own, the general contractor will be liable for damages caused by their subcontractors.

Depending on the policy, contractor liability insurance can cover many types of work, including:

  • renovations or repairs
  • installations (windows, floor coverings)
  • heating and air conditioning
  • roofing
  • drywalling and plastering
  • landscaping
  • painting
  • plumbing

For more information about contractor liability insurance, or to purchase a policy, contact Ai Contractor Liability Insurance.

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