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How Much does General Liability Insurance Cost for Contractors?

General liability insurance costs for contractors depend on many factors including the policy limit, deductible, insurer, business location or locations, level of risk, type of contracting work, and many other factors.

Insureon, a leading digital insurance broker, estimates that general contractors pay a median monthly premium of about $90, or $1,090 per year, for general liability insurance protection. That’s for a policy with a $1 million per occurrence limit and a $500 deductible.

General liability insurance is definitely a worthwhile investment, because this coverage provides protection against injuries to clients, customers, delivery people, and other non employees on your business property, damage caused by you or people who work for you to client property, and advertising and communication related errors.

The issue: The median $90 monthly premium amount is exactly that — a median.

There are many types of businesses that fall under the contractor category. Some can secure general liability coverage for less than half that median amount. Others have to spend many times it.

In this article, we’ll explore how much different types of contractors can expect to pay to get general liability coverage, along with information on the factors that influence premium costs and how to get the general liability coverage that’s right for you.

Contractors general liability insurance costs for different contractor types

Here are the typical costs of general liability coverage for different types of contractors. Click on the links to find out more about insurance coverage for each type of contracting business.

Contractor type General liability insurance cost (median) 
Carpenters $70 a month 
Cleaners $45 a month 
Construction workers $70 a month 
Electricians $45 a month 
Excavators $83-$127 a month 
Handymen $65 a month 
HVAC contractors$37-$59 a month 
Landscapers $45 a month 
Painters $50 a month 
Plumbers $125 a month 
Roofers $300 a month 

How much does general liability insurance cost for carpenter contractors?

According to Insureon, Carpenters pay a median premium of less than $70 per month, or $835 per year, for general liability insurance with a policy limit of $1 million per occurrence and a deductible of $500. Rates for carpenters can vary depending on the kind of work they do and types of properties they work on.

Learn more about business insurance for carpenters, costs, and the best providers.

How much does general liability insurance cost for cleaner contractors?

Cleaning and janitorial businesses typically pay a median premium price of less than $45 per month, or $530 per year, for general liability insurance, according to Insureon. For cleaning businesses that purchase general liability insurance with the company, 16 percent pay less than $500 per year and 69 percent pay between $500 and $1,000 annually for the coverage. Only 15 percent spend more than $1,000. In this category, the size of the business and number of clients have the biggest impact on premium costs.

Learn more about business insurance for cleaners in general, window cleaning, carpet cleaning, and best providers of cleaning business insurance.

How much does general liability insurance cost for construction contractors?

Insureon reports that construction businesses pay a median premium of less than $70 per month, or $825 per year, for their general liability insurance. The insurance company reports that of all the construction businesses that purchase general liability coverage from them, 24 percent pay less than $600 per year and 48 percent pay between $600 and $1,200 annually. Roughly one out of four construction businesses, usually those that face higher risks or are relatively large, pay more than $1,000 for coverage.

Learn more about the best providers of general liability insurance for construction companies and the best providers of construction insurance.

How much does general liability insurance cost for electrician contractors?

Electrical contractors pay a median premium of $45 per month, or $540 per year, for general liability protection. That’s for a policy with a limit of $1 million per year and a $500 deductible. That’s based on the latest data from Insureon.

How much does general liability insurance cost for excavator contractors?

According to Farmer Brown, the average premium for a standard small excavation company general liability insurance policy with $2 million per year and $1 million per occurrence limits ranges from $83 to $127 per month based on where the business is located, size, payroll, sales, years experience, and claim history. 

How much does general liability insurance cost for handyman contractors?

According to Insureon, handymen pay a median premium of about $65 per month, or $800 per year, for general liability protection. That’s for a policy with a limit of $1 million per occurrence and a deductible of $500.

Learn more about handyman insurance and the best providers of handyman insurance.

How much does general liability insurance cost for HVAC contractors?

The General Liability website reports that the average price of a standard general liability insurance policy for small HVAC contracting businesses, with limits of $2 million per year and $1 million per occurrence ranges from $37 to $59 per month based on business location, size, payroll, sales, and experience.

Learn more about HVAC contractor insurance and the best providers of HVAC contractor insurance.

How much does general liability insurance cost landscaping contractors?

Insureon’s data shows that landscaping businesses pay a median premium of about $45 per month, or $530 per year, for general liability protection. This is for a standard policy of $1M per occurrence limit and $1M in aggregate limit and $500 deductibles.

Learn more about the best providers of landscaping contractor insurance.

How much does general liability insurance cost for painter contractors?

Insureon reports that general liability coverage for sign painters, paperhangers and house painters, costs about $50 per month, or $600 per year. That’s for a policy with a $1 million per occurrence limit and $250 deductible.

How much does general liability insurance cost for plumbing contractors?

Plumbers pay a median premium of less than $125 per month, or $1,480 per year, for their general liability insurance. That number is also courtesy of Insureon. The policy comes with a limit of $1 million per occurrence and a $500 deductible.

Learn more about business insurance for plumbers and the best providers of plumbing contractor insurance.

How much does general liability insurance cost for roofing contractors?

Roofing businesses pay a relatively high median premium of about $300 per month, or $3,590 per year, for general liability protection. That’s for a policy with a $1 million per occurrence limit and a relatively high $1,000 deductible. The high premium price reflects the risks associated with doing roofing work.

Learn more about the best providers of roofing insurance.

People who do contracting work face significant risks that could cost them a lot should something unfortunate occur. Even if your business is a relatively small one, you should speak with an insurance agent or company representative to find out if you should get general liability coverage. It’s likely they’ll recommend it because it’s a sensible investment in the long term security and success of your business.

Factors that impact the cost of general liability insurance for contractors

Here are some of the top factors that impact the cost of general liability coverage. Understanding them will help you gain control over your premium prices.

Size of the business:
Larger contracting businesses typically require more insurance protection, which costs more. This doesn’t only apply to the number of contractors, subcontractors, and other types of workers your business employs. If you have a larger client base, you face more risk of lawsuits and other claims, which makes it an even bigger factor when it comes to determining your general liability premium.

Insurer:
Different insurance companies calculate general liability policy premiums in different ways. And they may have different preferences (appetites) for covering certain types of contracting businesses. This will impact the quotes insurers provide. It’s the reason you owe it to yourself, and your business, to get quotes from several insurance providers.

Claims history
This is a simple insurance concept most people understand. If you’ve made a lot of claims on your general liability insurance,  it’s a sign to an insurer that you’re more likely to file more claims in the future. If you’ve filed claims in the past, you can expect to pay higher premiums. The lesson: Not all incidents are preventable, but it’s still important to operate your business in as careful a way as possible to avoid unnecessary claims that could increase your insurance costs.

Credit score
The credit score of the contractor or business owner who is the policyholder can also impact the cost of contractors insurance. Credit scores are considered to be a measure of how reliable a policyholder will be in paying their insurance premiums in full and on time. They are also reflective of how responsible people are. If you have a low credit score, you will likely pay more for general liability insurance because you’re viewed as a bigger risk. The good news: A high credit score can save you money on coverage.

The nature of your contracting business
Though all contracting businesses face the risk of lawsuits, some are more susceptible than others. People are more likely to sue a roofing company over a leaky roof repair that results in significant interior damage than a landscaper over a few dead plants. Contractors that do high risk work they could be sued for will pay more for coverage.

Location. Location. Location
Some cities and states are known for their high rates of lawsuits. If your business is located in one of them, you’ll pay more for general liability protection.

These aren’t all the factors that will influence your general liability premium, but they’re the ones that will have the biggest impact.

What is general liability insurance for contractors: The basics

General liability insurance for contracting businesses helps protect against claims of damage to other people’s property, bodily injury, and other issues. This coverage is sometimes referred to as business liability insurance or commercial general liability insurance

Contractors of all types need this coverage because accidents, injuries, and other types of incidents often happen during the normal process of conducting business because of the nature of the work they do. 

Some examples of covered incidents include:

  • An employee at a landscaping company drives a backhoe over a client’s privet hedge causing thousands of dollars worth of damage.
  • An electrician unintentionally causes a power surge while fixing wiring at a client’s home, damaging thousands of dollars worth of computers, televisions, and other electronic equipment.
  • An employee breaks a client’s valuable vase while laying a new floor in their home.
  • A worker forgets to post a sign after washing a floor at a workshop. A client slips, falls, and injures her hip while visiting the workshop to check on a project. This results in tens of thousands of dollars in medical and recovery costs.

In all these cases, general liability insurance would pay replacement, repair, medical, and legal costs resulting from the incident.

What does general liability insurance for contractors cover?

General liability insurance helps pay for property and other types of damage that occur as a part of doing business. It also helps cover injuries that happen on your business property. Typically, general liability insurance can help cover claims related to:

  • Third party property damage caused by you or an employee while conducting business 
  • Medical costs if your customer or client gets hurt when visiting your business
  • Reputational harm resulting from malicious slander, libel, violating a person’s privacy, and more
  • Advertising issues, such as copyright infringement and mistakes on your website.

Why contractors should get general liability insurance

The federal and state governments don’t require businesses to carry general liability insurance, although, most clients and landlords will make you get it. However, it’s a good idea for small businesses to have it. 

Think about it: If a visitor slipped and fell at your business and was injured, could you afford to pay their medical bills? Would you be able to pay to repair damage to a valuable painting if it’s caused by you or an employee while working at a client’s house?

The answer for most contracting businesses is NO and NO. That’s why general liability is one of the most popular business coverages for contractors, after workers’ comp and commercial vehicle insurance.

How to find cheap general liability insurance for contractors

Here are some tips to help you find the coverage you need at a fair price:

  • Shop around for the best value. Get quotes from a few companies so you can compare coverage and prices. 
  • Don’t stop shopping around. Make sure you get new quotes before you renew your policy.
  • Take advantage of discounts. If they’re not offered to you when getting a quote, ask about them, whether you’re buying online or through an agent.

Taking these steps will help ensure you’re not paying too much for your general liability coverage.

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