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Irrespective of the service provided, contractors are highly recommended to take out a contractor insurance policy to safeguard their business, staff, and clients in the event of an accident or an injury that results in a claim or a lawsuit.

Legal actions against contractors can be a big financial burden for any company that doesn't have the necessary insurance in place. And as much as contractors think they can get away with not having insurance, a single accident can put their entire livelihood at risk.

Below, we will take a look at the most recommended insurance policies for contractors as well as which contractors can mostly benefit from insurance and why.

What Insurance Policies Are Relevant for Contractors?

Contractors can take out various types of insurance policies. Generally speaking, the level of coverage contractors take out depends on the size of the business, whether the company employs any staff or owns company vehicles, the state the contractor operates out of, and more.

Below, you can find some of the most recommended insurance policies that contractors take out all over the United States.

How Much Does Contractors Insurance Cost?

The cost of contractors' insurance will depend on the level of coverage you opt-in for, the size of your business, and the insurance company you decide to go for.

Generally speaking, for contractors' insurance, you can expect to pay a few thousand dollars per year if you’re a small to medium-sized business with employees and company cars. To break it down, you can expect to pay around:

  • $900 for general liability insurance per year
  • $2,000 for worker's compensation insurance annually
  • $1,500 per year on commercial auto insurance
  • $140 per year for contractor's tools and equipment insurance

Which Contractors Can Benefit From Insurance?

Contractor insurance policies are relevant for most contractors. Below, you can take a look at some of the different contractors that can benefit from contractor insurance.

Appliance Repair

Appliance repair contractors have the sole responsibility of repairing appliances that are no longer functional. Though the nature of repairing appliances is quite simple for experienced contractors, there is also a slight degree of risk involved that may lead to further property damage, accident, or injury.

With appliance repair insurance in place, the appliance repair contractor will be financially covered by their insurance company in the event of a lawsuit or a claim made against the appliance repair service provider.


Carpenter contractors make use of saws, nail guns, and other equipment that can cause bodily injuries and irreversible property damage when misused.
In the event of an accident or an injury, the carpenter contractor can be held liable for the damages caused. And without the appropriate carpenter insurance in place, the contractor will have to pay out of pocket for any legal fees, medical expenses, and other costs and fees if found guilty.


Electrician contractors work in a high-risk environment on a daily basis. From live wires that can lead to electrocution to accidental fire causing property damage, there are a lot of things that can go wrong, which can cost the electrician contractor dearly.

This is why contractors in the industry should opt-in for electricians' insurance. The policy will protect the business financially in case an accident takes place and it results in a lawsuit or a claim.

Financially Responsible Officers

Financially responsible officers are responsible for all financial matters within a company. In case of a mistake or an accident, their actions can be devastating for the business, which can lead to large claims and lawsuits from the employer.

Whether the financially responsible officer works for a small or a large business, it's always a good idea to take out financially responsible officer insurance, which will cover legal fees as well as financial damages that the employer might sue the financially responsible officer for.

Framing Contractors

Framing contractors are responsible for setting the structure of residential and commercial properties in accordance with the plans of the appointed architect.
As a result of their day-to-day activities, framing contractors can suffer from a vast range of bodily injuries, accidentally damage their customer's property, or be held liable for negligence or unsatisfactory work.

These are all risks that can lead to costly lawsuits, which the contractor will have to pay for out of pocket in case they don’t have framing insurance in place.

General Contractors

General contractors don't specialize in any particular trade. Rather, they deal with projects on demand, which can differ greatly. As a result, general contractors face a wide array of risks on a daily basis depending on the job that they are going to do.

General contractor insurance is highly recommended as the risks associated with the jobs done can vary from day to day, which can lead to accidents and injuries that may turn into claims and costly lawsuits.

When the general contractor is covered by a suitable insurance policy, the insurance company will cover all the costs and financially free the contractor from any financial liabilities regardless of the accident at hand.

Handyman Services

Handyman service contractors are responsible for carrying out general repairs and maintenance tasks on buildings. Their day-to-day responsibilities carry the inherent risk of accidentally causing damage to property or suffering from bodily injuries in case of falls, trips, and slips.

Having handyman insurance in place will safeguard your business, employees, and clients from any claims and lawsuits that may arise in the event of an accident or an injury at the site of work.


Locksmith contractors aren't exposed anywhere near to the same level of risk compared to some of their contracting colleagues in other industries. Despite that, accidents do happen, and those can be quite costly to resolve.

As a result, a locksmith's insurance can provide the necessary coverage in case a locksmith accidentally damages the customer's property or loses valuable tools and equipment.

Building Equipment Contractors

Building equipment contractors are exposed to a wide array of risks involving bodily injuries, property damage, and more. In case any of these accidents take place, the contractor can be held accountable.

In the event of an accident that leads to legal action, having other building equipment insurance will financially shield the contractor as the insurance company will cover all legal fees, financial reimbursements, and other associated costs.


Painting contractors can be held liable by clients in the event of irreversible property damage. On the other hand, if an employee falls sick or gets injured while working, they can sue their employer and claim money to cover any medical expenses, hospital bills, lost wages, and more.

This is why painting contractors are always recommended to take out a painter's insurance policy, which will provide all the necessary coverage in case an accident takes place and leads to a lawsuit or a claim.


Plumbing contractors are responsible for fixing, installing, and renovating water systems for both commercial and residential properties.

Due to the nature of the plumbing trade and the physical labor involved, plumbing contractors are always exposed to the risk of sustaining injuries or accidentally causing further damage to the water system they're working on.

Plumbing insurance can shield your plumbing business by freeing it from any financial liabilities that your business might end up being liable for in case there is a lawsuit or a claim filed against the company in the event of an injury, property damage, or unsatisfactory work.

Snow Ice Removal

Snow and ice removal contractors often work in dangerous weather conditions, which can lead to accidents, mild to serious bodily injuries, and property damage, which can easily result in a financial claim or a lawsuit.

As a result, snow and ice removal contractors are recommended to take out snow and ice removal insurance, which will keep the business, staff, and clients safe at all times, no matter the accident or injury at hand.


Welding contractors are responsible for cutting, joining, and shaping metal plates, pipework, and other composite materials across a number of industries. As a result, bodily injuries are not uncommon as contractors in the field are constantly exposed to the risk of electrical shock, fumes, gasses, fires, and explosions.

That's why welding insurance is recommended to contractors that want to safeguard their business from claims and lawsuits that arise from injuries and accidents at the workplace.

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