5-Star Commercial and Contractor General Liability Insurers 

What is commercial general liability insurance for contractors?  

General liability insurance for contractors covers the more common business risks, such as customer property damage, customer injury, and advertising injury. It will help you quality for contracts and leases and protects your contracting business from costly lawsuits. 

Independent contractors, like all other small business owners, can be held liable for damages and sued, which is why general liability insurance is essential. Here are three reasons why you need general liability insurance: 

It protects you and your business. Since independent contractors have the same liability exposures and legal obligations as larger firms, they can be sued for causing bodily harm, damaging a client’s property, and advertising injury. In the event of a lawsuit, general liability insurance will help to cover damages and legal fees. 

Your clients want you to have it. Before they sign a contract with you, your client might need you to have general liability insurance. Otherwise, they may be held responsible for accidents caused by you and your work or for alleged wrongdoing. 

It may be required by law. For certain industries like construction, state regulations in the U.S. may require independent contractors to carry general liability insurance. Usually, it is better for you and your client to purchase separate general liability insurance policies.  

What is the difference between commercial general liability and general liability? 

Commercial general liability insurance (CGL) is also known as general liability insurance (GLI), and can cover claims that your company caused property damage or bodily injury. A general liability policy will help you cover claims that your business caused the following damages: 

Third-party bodily injury. A customer can sue your business if they injure themselves slipping in your store. In this case, your policy will include bodily injury coverage and help pay for any medical bills.  

Third-party property damage. Your business could face risks of causing property damage if you or your employees work at a client’s house. If your business damages someone else’s belongings, property damage liability coverage would help pay replacement or repair costs.  

Reputational harm. Due to something you or your workers said, someone could sue your business for slander or libel. In this case, general liability insurance can help cover your legal costs. 

Advertising injury. Your business could face a lawsuit over copyright infringement. If, for instance, you use a photographer’s photo without their permission, they could sue you.  

What does general liability cover for a business?  

General liability covers business owners in the event of third-party claims of property damage and bodily injury and helps pay for property damages and medical expenses. General liability would also pay for legal defense should a business operation lead to you being sued, and can take care of judgments or settlements that arise. A general liability policy will also cover you if your business is sued for slander, copyright violation, or libel.  

It is dangerous, however, to assume that general liability policies cover everything. For instance, this type of policy only covers third-parties with regards to property damage, meaning it will not take care of the damage your business causes to your own property.  

Does general liability cover independent contractors?  

Independent contractors work as separate entities from your business, meaning they are not your employees but instead conduct work on behalf of your company. Typically, general liability insurance doesn’t protect subcontractors or independent contractors, which also means your insurance probably does not cover their mistakes or protect your customers from their mistakes. It’s also unlikely it covers accidents or the damage cause by accidents.  

Who needs commercial general liability insurance? 

Commercial general liability insurance is to protect any business from financial losses if they are liable for personal or advertising injury or property damage during business operations or resulting from your employees. It will protect you and your business in case a customer injures themselves while visiting your business; if an employee of yours causes substantial damage to a customer’s home; or a class-action lawsuit is filed against your business for ads that contain misleading information. It will also cover legal defense costs and pay on your behalf if you are found liable. Due to the negative impacts that a lawsuit can have on businesses and because liability suits happen so often, commercial general liability is one of the more important insurance products – for any business.  

How much is liability insurance for an independent contractor?  

Liability insurance for an independent contractor in the U.S. will cost roughly $29/month, or $344/year, but can cost about $42/month, or $500/year, when combined with commercial property insurance in a business owner’s policy.  

What is the best liability insurance for small business?    

In the U.S., the 7 best insurance companies for small business in 2021 is as follow:  

State Farm – best overall 

Hiscox – best for independent contractors 

Nationwide – best general liability insurance 

The Hartford – best workers’ compensation 

Travelers – best commercial property insurance  

Liberty Mutual – best business owners policy  

Progressive Commercial – best commercial auto