What is the purpose of contractor liability insurance?
Contractors professional liability insurance provides coverage that protects both contractors and third-party hires, like architects, designers, and engineers, in case of errors and mistakes made on the job, as well as other losses during a building project.
What does professional liability insurance cover and not cover?
What Professional Liability Insurance Does Not Include. Coverage does not include criminal prosecution, nor all forms of legal liability under civil law, only those listed in the policy. Cyber liability, covering data breach and other technology issues, may not necessarily be included in core policies.
What does builders general liability cover?
General liability insurance coverage for contractors and construction businesses. General liability insurance covers common business risks like customer injury, customer property damage, and advertising injury.
What is contractor professional liability?
Definition. Contractors Professional Liability Insurance — a specialized coverage developed in the 1990s to address contractors’ liability for design errors or omissions.
Who is covered under professional liability?
Professional Liability — a type of liability coverage designed to protect traditional professionals (e.g., accountants, attorneys) and quasi-professionals (e.g., real estate brokers, consultants) against liability incurred as a result of errors and omissions in performing their professional services.
Does professional liability insurance cover employees?
Professional Liability Insurance covers you, your business, your employees, and independent contractors while they are working for your business. It will pay for any judgments against your business, as well as the costs of your legal defense, whether or not your business is found to be at fault.
Does general liability insurance cover independent contractors?
General liability insurance generally does not protect independent contractors or subcontractors. This means your insurance likely does not cover independent contractor mistakes or protect your customers from them.
Does professional liability insurance cover subcontractors?
Unlike a general liability policy and some other policies, businesses and sole proprietors cannot extend their E&O coverage to independent contractors or subcontractors by naming them as an additional insured on their professional liability insurance. Instead, contractors must purchase their own insurance.
Who needs professional liability insurance?
Professionals that operate their own businesses need professional liability insurance in addition to an in-home business or businessowners policy. This protects them against financial losses from lawsuits filed against them by their clients.
Does liability cover negligence?
In other words, a liability policy which provides coverage for “bodily injury caused by an accident,” also provides coverage for the insured’s negligent acts. In applying this principle, the insured’s negligence in hiring, retaining, or supervising that employee could be considered an indirect cause of injury.
Does umbrella cover subcontractors?
Umbrella Insurance DOES Cover Contractors! In fact, more Business Umbrella Policies for Contractors are sold than most any other type of business.
What insurance should I require from a contractor?
The most important insurance that a hired contractor should have is workers compensation insurance. Hiring a contractor without workers comp insurance could leave you paying an injured employee or subcontractor’s medical bills indefinitely, just for hiring someone to fix your property.
Do independent contractors need general liability insurance?
General liability insurance is essential for independent contractors because: It protects you and your business. Independent contractors have the same legal obligations and liability exposures as larger firms. They can be sued for damaging client property, causing bodily harm, or advertising injury.
How much does general contractor insurance cost?
The Basic Cost Of General Contractor Insurance The average cost for a general contractor insurance policy that provides the minimum coverage of $1 million is about $90 per month. That cost can vary depending on where your business is located, among other factors described below.
Why do subcontractors need insurance?
When you are an Additional Insured, your company is protected by the subcontractor’s policy, just as they are. That way, if you are sued as a result of damage the subcontractor causes, the subcontractor’s insurance company is required to cover your company for the claim.
Do I need insurance as a subcontractor?
Although workers comp insurance may not be required by each state, many general contractors or project owners require that subcontractor still have such an insurance in order to protect them from personal liability from the subcontractor or his employees.