Contractors Insurance – Liability Insurance for Renovation, General, Sub Contractors, and More!

A Canadian Guide For Contractors Liability Insurance

Construction contractors in Canada can make a substantial amount of money, but these professionals are required to work in highly stressful situations. They’re responsible for keeping everyone happy. This includes their employees, clients, and suppliers. If anyone is unsatisfied, the project could be shut down quickly. And, it is vital to consider the responsibilities at home. These individuals are responsible for maintaining their tools and equipment, while keeping up with the company’s finances. Anything could go wrong at any point in time and a single flaw could prove to be devastating.


With the use of contractors liability insurance, the contractor will have an immense amount of protection from potential future problems. Below, you’ll learn more about this type of insurance and its importance for Canadian construction contractors.

What Is It?

First and foremost, it is vital to learn about the basics of liability insurance for contractors. The insurance is intended for construction contractors and protects them from construction errors. The insurance can provide protection for errors made by the contractor, as well as problems that are caused by 3rd party groups, which have been hired by the contractor. While some Canadian contractors have in-house designers and engineers, most do not and will be required to hire third party groups to handle these tasks. Contractors, which handle the tasks themselves, will assume all of the risks. Regardless of which category you fall into, it is pertinent to make sure you’re protected. This is what contractors liability insurance is all about.


If your company is unable to deliver a satisfactory project, the client will undeniably become upset and may decide to lash out via a lawsuit. A lawsuit will give the client the opportunity to recover money they feel is owed to them, due to your error or neglect. Even if the lawsuit is frivolous, you will be required to pay for attorneys to protect your interest in the Canadian courts. This can be enormously expensive and a settlement in the client’s favor could very well put you out of business. This is why contractors liability insurance is so important.

The insurance will protect you from expensive claims, as well as potentially devastating lawsuits. The policy can cover the cost of defense as well as any settlements made against your company.

Does Contractors Liability Insurance Cover Bodily Injuries?

As a professional in a labor-intensive industry, you already know that no matter how careful you are accidents are going to happen. When you work with heavy equipment and in dangerous situations sometimes the worst possible thing is going to happen. This is a very unfortunate situation, but it is just a necessary evil that you must face. This is where contractors liability insurance can come in very handy. The insurance will protect you, your clients, and your employees in the event that bodily damage occurs.

If one of your employees gets hurt on the job, this insurance policy will cover the hospital bills or funeral costs. If one of you employees accidently and uneventfully causes damage to another employee or a client, this policy will also cover the same costs for the employee or client that got injured. In the event that you are taken to court by a third party, you may be able to seek compensation for any legal fees that might arise.


Property Damage

If you are a Canadian contractor, you will need to gear up with a solid contractors insurance policy. This policy will protect you from financial loss, in the event of property damage. Believe it or not, when you are working on a construction site, with building structures nearby anything can happen. Even the slightest malfunction of a crane, you may be looking at extensive damages. Also, your own property will be at risk, since this is a high-functioning industry, with lots of employee involvement.

Accidents can occur without a moment’s notice, which is why it is crucial to get covered. Many contracting companies will hire employees to renovate building from the inside out. You may not feel that contactors insurance coverage is necessary in these cases, but again anything can happen. The building will most likely be fairly solid, but you may need to reinforce the existing support system. This may include anything from replacing interior walls, eave struts, frame columns, or sidewalls. These are very important components of a building, meaning they will be very risky to repair or replace.

Equipment Vandalism

Contractors are most often forced to leave their expensive heavy equipment on the jobsite. While, many contractors will opt to hire a security guard to monitor the worksite premises during downtime, this will be an extra expense. It would only make sense to add the equipment vandalism and breakdown to your existing policy. This coverage will compensate for any loss, caused by vandalism criminality. Heavy equipment and power tools are very expensive to replace, but their loss can also cause the operation to be put on hold.

Pollution Coverage

Over the past few years, climate change has become a major concern for Canadian officials. These individuals have put measures in place to protect the environment and contractors will be required to abide by the new guidelines. If you fail to do so, you will be held liable. Many insurance policies will now come with the addition of pollution coverage. It is not a necessity, but it is something you should definitely consider adding to your policy. This type of add-on coverage will protect you, if you fail to quantify or detect the presence of pollutants.

Limit And Deductible

When attempting to acquire a good contractors liability insurance policy, it is vital to take a close look at the limit and deductible. The limit is the maximum amount, which will be paid out in the event of a dispute. Meanwhile, the deductible is the amount you will be required to pay to the insurance company monthly or annually. It is generally possible to increase the limit, but this may also result in an increase in the deductible. Therefore, you should know your risks and your limits, before attempting to get a policy, which best suits your needs! Also, a handful of other factors will play a role in both. These include your credit, history, and the risks you face.