Do Contractors Need Professional Liability Insurance?

Why Professional Liability Insurance Matters For Contractors

If you are a contractor who subcontracts most of your design work out to another individual or company, you may assume that your commercial general liability insurance is enough to keep you covered. After all, your subcontractor is carrying professional liability insurance and has agreed to indemnify you for any liability, right?

Just because your design professional has a separate professional liability insurance policy does not mean you are safe. In fact, there are a few reasons why you should consider adding a professional liability policy of your own to your existing contractors insurance.

• You may think that a hold harmless provision is enough to ensure you are never held liable. In fact, though, it is not uncommon for those provisions to be declared unenforceable.
• Professional liability insurance operates out of a claims-made timeline. That means the policy needs to be in effect when a claim is made in order to offer coverage. If your design professional goes out of business or drops his or her policy, that will leave you exposed to claims made down the road.
• What happens if your subcontractor’s policy limits are insufficient to cover your needs, or if the policy is already exhausted by another incident? By carrying your own professional liability insurance, you stay in control of your limits and ensure you will not face unforeseen expense.

You do not have to be on your own when trying to decide if you need professional liability insurance. To work with a team specializing in insurance for contractors who can help you get the right policies to protect your work and yourself, contact Built Insurance Brokerage. With policies tailored to best fit the construction industry, we are here to ensure your business and your workforce are covered. For all of your contractors professional liability insurance needs, call us today!