Commercial General Liability Insurance for Contractors

Why Contractors Need General Liability Insurance

Contractors face liability exposure on every job. A client's property damaged during demolition, a subcontractor injured on your site, a third party who slips near your work area — these are real claims that happen to careful, experienced contractors. General liability insurance is the policy that covers these exposures, and it's a requirement for pulling permits, bidding commercial work, and protecting a business you've built.

California contractors are required by law to carry a license from the Contractors State License Board (CSLB). While CSLB doesn't mandate liability insurance at the state level, virtually every commercial project, general contractor, and municipal permit office requires proof of coverage. Without it, you can't work.

Common Liability Risks for Contractors

• Third-party bodily injury on or near your job site
• Damage to a client's property during work
• Damage to adjacent property from construction activity
• Completed operations claims after project handoff
• Subcontractor liability if they don't carry their own coverage

What a CGL Policy Typically Covers

What May Require Additional Coverage

• Workers' compensation (required if you have employees in CA)
• Commercial auto for work vehicles
• Tools and equipment coverage for your gear
• Builder's risk for specific construction projects
• Professional liability if you provide design or consulting services

Cost Factors for Contractors Liability Insurance

The typical monthly cost for general liability insurance for contractors in California runs $55–$200/month. Several factors determine where in that range your policy falls:

• →Type of contracting work (roofing and demo cost more than painting)
• →Annual payroll and revenue
• →Years in business and claims history
• →Policy limits requested ($1M vs $2M per occurrence)
• →Whether subcontractors are used and whether they carry their own coverage
• →Number of employees