Subcontractor Insurance Requirements

General contractors face significant liability exposure from subcontractor operations. When a subcontractor causes injury or property damage, the general contractor and project owner are frequently named in lawsuits. Without proper subcontractor insurance, the GC's own policies must respond, increasing claims experience and future premiums. Effective subcontractor insurance management transfers risk to the party best positioned to control it. Every subcontract should specify insurance requirements, require certificates of insurance before work begins, and include indemnification provisions backed by insurance.

The additional insured endorsement is the most important subcontractor insurance requirement. It extends the subcontractor's GL coverage to the GC for liability arising from the subcontractor's work. Use ISO form CG 20 10 for ongoing operations and CG 20 37 for completed operations, or their equivalent. Primary and noncontributory endorsement (ISO CG 20 01) ensures the subcontractor's coverage is primary and does not seek contribution from the GC's policies. Waiver of subrogation endorsement prevents the insurer from recovering payments from the GC. These endorsements should be verified on actual policy copies, not just certificates of insurance.

Certificate of insurance verification is the starting point but not sufficient alone. Certificates are informational only and do not guarantee coverage. Best practices include collecting certificates before work begins, verifying named insured matches the contracting entity, confirming policy dates encompass the project timeline, checking that additional insured and other endorsements are listed, and requiring copies of actual endorsements for large subcontracts. Consider using an automated certificate tracking system for managing multiple subcontractors. Re-verify coverage at policy renewal dates throughout the project.