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Contractor looks up at looming crane in busy city as he contemplates public liability insurance.

Public liability insurance is something that all contractors should consider. Even if it is not currently required by your state licensing board, an increasing number of clients are insisting that contractors be adequately insured.

If you are working as a subcontractor, public liability insurance will be required by the hiring contractor or general contractor. Plus, having this insurance gives you peace of mind and can provide coverage for defense costs in the unlikely event that a claim is made against you.

In this blog, we will discuss what public liability insurance is, whether you need it as a contractor, and how to get the best coverage for your business.

What is Public Liability Insurance?

Public liability insurance is a type of insurance that protects you against claims arising from injuries or damage caused by your business activities. It can cover legal costs and any damages that may be awarded to the claimant.

Public liability insurance is often required by state licensing, depending on where you live. But, even if it is not required, it is a good idea to have if you run a business. This is because it can protect you from financial losses if you are sued for damages caused by your business activities.

As more and more clients are becoming aware of the importance of public liability insurance, they are insisting that contractors have this type of insurance before they will work with them. If you are working as a subcontractor, the general contractor or builder you are working for will likely require that you have public liability insurance.

Do I Need Public Liability Insurance As A Contractor?

Public liability insurance is not required for all contractors, but it is a good idea to have if you’re working in a situation where your business could be held responsible for damages or injuries caused by your work.

Public liability insurance may also cover workmanship errors, such as a customer being unsatisfied with the work you've done and charging you for a re-do. In these cases, you'd likely need an add-on to your existing insurance policy, such as Errors & Omissions coverage.

Public liability insurance is important for contractors because it can help protect you, and the business you're working for, from financial damages caused by your work.

As a contractor, you should also be aware that some customers may require you to have a certain amount of public liability insurance before they would consider hiring you.

As of June 2022, there are seven states in the USA that require public liability insurance. Those are:

  1. Colorado
  2. Connecticut
  3. Kansas
  4. Massachusetts
  5. New Jersey
  6. Rhode Island
  7. Wisconsin

If you're unsure if your business needs public liability insurance, talk to a World Insurance agent to learn more.

contractor with public liability insurance sits at bottom of ladder clutching leg in pain after injury

Public Liability Insurance Coverage

Standard public liability insurance will protect you if you're found liable for accidentally damaging someone else's property or injuring another person while you're working. For example, if you're a painter and you accidentally spill paint on your client's new carpet, public liability insurance can help pay to have the carpet cleaned or replaced.

Other claims, such as an injury on the job or product liability, can also be covered under a public liability insurance policy.

There are some circumstances that public liability insurance may not cover without an add-on, like workmanship errors.

Let's say you are painting a room for a customer. If the customer decides they don't like the color you painted, they may want to hire someone else to repaint the room– at your expense.

Standard public liability insurance policies will only cover mistakes that caused damage to the customer's property, such as spilling paint on their carpet or damaging furniture. Workmanship errors, such as disliking the job done, require additional Errors & Omissions coverage.

If you think you may need additional Errors & Omissions coverage, talk to your World Insurance agent about options to amend your existing plan.

Public Liability Insurance for Businesses

We can live without a lot of things, but peace of mind isn’t one of them. This is especially true for business owners. You’ve worked hard to get where you are and the last thing you want is to lose it all because someone decides to sue you.

If you have a business, large or small, you need to think about getting public liability insurance. No matter how cautious you are, accidents can happen. Public liability insurance can protect your business from claims made by the public for things like personal injury or damage to property. You may also want to look into Employment Practice Liability Insurance (EPLI) to cover defense costs and damages related to employee claims.

Public liability insurance is an important part of any business and, as a contractor, you need to make sure you are properly protected. Contact World Insurance today to learn about our public liability insurance plans for businesses.


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