Contractor Liability Insurance Coverage Explained

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The construction business is a very aggressive and demanding industry wrought with the possibility of injury while on the job. Because of this danger, the proper liability insurance must be obtained to protect assets and take control of liability. A good builder liability insurance coverage can protect against injuries, accidents, or property damage suffered on the job.

Furthermore, construction workers can accidentally damage a property. This damage can come from mishandling materials and tools, or while a remodeling process is underway.

With many jobs—especially on government contracts—it is a requirement to provide evidence of liability insurance as part of the qualification process. Subcontractors also are required to present their evidence before entering or starting their participation in a construction job.


A good construction liability insurance policy protects your business from lawsuits or damages made by claims during the construction process. The most important advantages of the benefits of having liability insurance are:

  • It will protect your business against injury and/or property damage.
  • Liability insurance will assist you in covering costs and damages after a judgment has passed.
  • It provides a certain level of value and security knowing that your assets and employees are protected.
  • It can be used to cover the cost of attorney fees, witness fees, court expenses, and more.
  • The construction liability will protect in many different ways: your company as a whole and individual claims against the company.


Construction liability insurance might be used in the following circumstances:

  • Injury claims: The policy might be used to pay for medical expenses, funeral, and court-awarded compensations, This coverage is not a worker’s comp type of coverage.
  • Damage claims: The insurance will protect you when your company damages the customer’s property or if your business is responsible for their inability to use that property.
  • Product claims: Claims related to damages caused by equipment installed by your company, can be managed and addressed through the liability insurance coverage.
  • Copyright claims: If you own the design on a product, you might be sued for copyright infringement if it is very similar to your competitors’.


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