Do Subcontractors Need Their Own Insurance? Yes – Here Is Why

If you work as a subcontractor, you have probably heard a general contractor say it plainly: no certificate, no job. Subcontractor insurance is not just a legal nicety – it is the currency of trust on a job site. Here is why nearly every sub needs their own coverage, even when the GC already has a policy.

Doesn’t the General Contractor’s Insurance Cover Me?

This is the most common misconception in the trades. The GC’s general liability policy protects the GC’s business, not yours. If your work injures someone or damages property, the claim lands on you. Worse, most GC policies contain subcontractor warranties: if the GC hires uninsured subs, the GC’s own coverage can be jeopardized – which is exactly why they refuse to let uninsured subs on site.

What Happens If You Work Without Insurance

• You get charged for it anyway. At the GC’s annual premium audit, payments to uninsured subs are typically added to the GC’s payroll and premium. Smart GCs back-charge that cost to you or simply never hire you again.
• You are personally exposed. Many subs operate as sole proprietors or single-member LLCs. A serious injury claim can reach personal assets.
• You lose bids you never knew existed. Many GCs pre-qualify subs through compliance platforms. No current certificate on file means your name never comes up.

The Subcontractor Insurance Checklist

Most subcontractors need some combination of the following:

1. General liability – the non-negotiable. $1 million per occurrence is the standard ask, with the GC named as additional insured.
2. Workers’ compensation – required in Nevada the moment you have an employee, and many GCs require it even from owner-only subs (or a valid exemption affidavit).
3. Commercial auto – if you drive to job sites with tools and materials, your personal auto policy likely excludes business use.
4. Tool and equipment coverage – job site theft is common, and general liability does not cover your own gear.

Additional Insured and Waivers: The Paperwork GCs Demand

Expect contracts to require naming the GC and owner as additional insureds on your policy and a waiver of subrogation in their favor. These endorsements are routine and inexpensive, but they must be set up correctly – a certificate that merely mentions them without the actual endorsements can be rejected by a sharp compliance reviewer.

What Subcontractor Insurance Costs

For many one- and two-person subs in lighter trades, a compliant general liability policy starts around $70 to $150 per month. Higher-risk trades pay more, but the cost is almost always less than the markup lost from a single missed contract. The math favors being insured.

Get Compliant Before the Next Bid

A Tale of Two Subs

Consider two drywall subs bidding the same GC. Sub A emails a current certificate showing $1M/$2M limits, blanket additional insured wording, and active workers’ comp within an hour of the request. Sub B says his cousin handles his insurance and he will track down paperwork next week. Sub A starts Monday. Sub B never hears back – and never knows why. Compliance speed is not bureaucracy; on the modern job site it is a bidding weapon. GCs remember the subs who make their paperwork easy, and the fastest certificate frequently beats a slightly lower number.

Frequently Asked Questions About Subcontractor Insurance

Can a GC’s policy ever cover subcontractors?

Some projects use wrap-up programs (OCIPs/CCIPs) where the owner or GC buys project-wide coverage enrolling all trades. These are the exception, mostly on large commercial jobs – and even then, subs need their own coverage for work outside the wrap.

What limits do GCs usually require from subs?

$1 million per occurrence and $2 million aggregate is the standard ask, with additional insured status and often a waiver of subrogation. Larger projects may require umbrella layers on top.

I only sub occasionally – do I need year-round coverage?

General liability is written annually, and canceling between jobs creates gaps that show up in underwriting later. If you sub at all regularly, continuous coverage is cheaper and cleaner than start-stop policies.

Does my sub insurance cover the GC’s mistakes?

No – your policy responds to claims arising from your work. Additional insured wording protects the GC for your operations, not for their own negligence, which their policy handles.

Do I need to name every GC I work for as additional insured?

Only those whose contracts require it – which in practice is nearly all of them. A blanket additional insured endorsement handles the parade automatically, converting each new contract from an underwriting request into a simple certificate issue. If you sub for multiple GCs in a season, blanket wording is the single most useful endorsement you can buy.

The worst time to buy insurance is the day a GC asks for your certificate. My Policy Plug sets up Nevada subcontractors with the exact endorsements GCs require and issues certificates fast. Call 702-444-2367 and be bid-ready this week.