Do general contractors in Ontario need insurance? What kind of options are there out there for me when it comes to coverage? Am I fully protected?
Because contracting is typically a lengthy process, insurance is an important element of having a safety net for you as a contractor, and for your clients.
Below is an overview of the insurance needs of a general contractor, as well as some things to consider when choosing an appropriate policy.
The Insurance You May Need
When it comes to anything renovation, construction, or infrastructure-related, there are a variety of different services available, each of them demanding something different in terms of skill set, tools, planning, vision, and execution.
This is why contractors need to be especially careful when understanding what kind of policy can help them feel protected when on the job.
A general policy can help cover all your bases. In fact, for a contractor to even be in business in Ontario, a general liability policy is required because it is needed to ensure the protection of both the customer and the contractor.
Because of the variety of risks that general contractors face every day, it is integral that you keep your employees, your customers, and your business protected.
General liability insurance, although fairly comprehensive, does sometimes require “Errors and Omission” policies to fill in the gaps. This allows coverage to occur even if there are errors and oversights, including negligence, failing to complete projects by specifications, and more.
At the end of the day, yes, general insurance is needed if you want to begin or remain operating as a contractor in Ontario.
A Contractor Controlled Insurance Program (CCIP) is another great avenue to take when minimizing risk. This is done by centralizing the purchase of insurance, either for a single job site or across all of the general contractor’s projects. Benefits include increased control for contractors and subcontractors, reduced costs, and reduced disputes among insured parties.
How Much Is General Liability Insurance
General liability insurance that is legally required does not have to break the bank and can save the tumultuous process of lengthier processes with the law, or mediation with a customer. For basic $2,000,000 CAD general liability coverage, the cost of insurance is around $400/year.
Higher coverage costs can run you up to $800/year and can ensure that you are covered if you are managing a larger project.
These are relatively low costs that can offset much larger ones should you not have one, so it is important to choose a policy that is comprehensive for your needs.