The cost of a Property and Commercial General Liability policy varies based on a variety of factors including type of work being performed, revenues, experience, and any property to be insured. As an example, a painting contractor’s premium would most likely be lower than a demolition contractor. As you can imagine, the demolition contractor has the potential for a greater exposure, and they would likely have heavy equipment to be insured.

To get started with obtaining contractor’s insurance, you will need to provide your FCA broker with a baseline of information on your business including experience in the industry, number of employees, sectors you work in (residential, commercial and institutional), revenues and any previous claims if you are an existing business. Following this, you will need to submit a full application and resume.

For new contracting businesses, more emphasis will be placed on experience in the industry as the insurance company providing protection wants to feel comfortable that you understand how to operate a contracting business and a manage employees.

For currently operating contractors looking for an alternative quote, more emphasis will be placed on your claim’s history. Note that claims do happen and that is why insurance is necessary, however, the insurance company is trying to understand the bigger picture and their potential exposure to future claims.

General Contractors, demolition contractors, mold and asbestos and restoration contractors should consider purchasing this policy as it is intended to cover the gap in your Commercial General Liability policy which typically excludes pollution conditions and exposures.

For example, if you are hired to remove mold from a school or a government office and months later when the job is complete and mold is found again, there is potential for a claim to be brought against you. A Commercial General Liability policy would not provide coverage for mold remediation, you would need a Contractors Pollution Liability policy.

Deciding on what limit of Commercial General Liability to carry requires considering what your risk tolerance level is and what limit you are comfortable carrying. The biggest influence on deciding what limit your company should carry is the contractual obligations you are signing. Almost all contracts will have an insurance requirement section that outlines the limit of liability per occurrence you must carry. Over the years, we have seen this requirement shift from $2MM to $5MM per occurrence.

If you are a contractor signing a CCDC 2 – Stipulated Price Contract including CCDC 41 (Insurance Requirements) there is a new version of this contract effective 2021. Part of the new insurance requirements in this contract is an increase in the Commercial General Liability occurrence limit to $10MM. This is something to consider when you are bidding on a tender.