Subcontractor insurance, read from the side that gets asked for proof

Additional insured, and whose limit gets spent. An additional insured is "a person or organization not automatically included as an insured under an insurance policy who is included or added as an insured under the policy at the request of the named insured," and in liability insurance the status gives them direct rights to make a claim under your policy (IRMI, additional insured). Read that as an owner of a small trade business: you are lending your limit. A claim defended and paid on the general contractor's behalf comes out of the same limit that stands behind you, and if that limit is spent on their claim it is not there for yours. That is an argument for a higher limit or a separate excess layer when you are adding several general contractors a year, and it is an argument for knowing exactly how many active additional insureds you have.

Which endorsement, and the period after you leave the site. There are two forms and they cover different periods. ISO narrowed CG 20 10 in 1993 so that it includes the additional insured "but only with respect to liability arising out of your ongoing operations performed for that insured," which IRMI describes as ruling out the additional insured's protection against completed operations claims; ISO's 2001 revisions introduced CG 20 37, "which restored the completed operations coverage for the additional insured that was deleted" (IRMI expert commentary, Mark Bell, 2013; IRMI, Additional Insureds and Completed Operations). For a subcontractor this is the expensive line in the exhibit. Completed operations additional insured status keeps the general contractor attached to your policy for the years after you have been paid and gone, which is exactly when a construction defect claim shows up, and carriers know it. If the contract asks for it, price it as a real cost rather than a signature.

Waiver of subrogation, and what your carrier gives up. A waiver of subrogation is "an acknowledgment by an insurer that it has no right to subrogate against a liable third party after it has paid a loss on behalf of its insured" (IRMI, waiver of subrogation). The right being given away is your insurer's, not yours, which is why your insurer has to agree and may charge for it. IRMI notes that policies generally permit the waiver where it is agreed before a loss, and that waiving after a loss works against the principle of indemnity and can be excluded, so the sequence is: contract to agent, agent to carrier, endorsement issued, then sign. Agreeing to a waiver in a contract your carrier has never seen is the version that goes wrong.

Primary and non-contributory, and the order of the queue. IRMI calls it "a term commonly used in contract insurance requirements to stipulate the order in which multiple policies triggered by the same loss are to respond" (IRMI, primary and noncontributory). Agreeing to it means your policy pays first and pays on its own rather than sharing with the general contractor's. Combined with additional insured status, the effect is that a claim arising on that job runs through your policy from the start, lands on your loss history, and follows you into your renewal. None of that is a reason to refuse; it is a reason to know that the requirements exhibit is a pricing document as much as a legal one.

One term you will not usually be asked for, but should understand: the standard liability form excludes damage to your own completed work and then makes an exception where the work was performed by a subcontractor of the named insured. Read from your seat, that exception is what protects the general contractor when your work is the problem, and it is why their contract works so hard to make sure your policy is real. The mechanics are on the general contractor page.

What the general contractor's accounts department wants is a document. A certificate of insurance is "a document providing evidence that certain general types of insurance coverages and limits have been purchased by the party required to furnish the certificate," and you are naming them in the certificate holder box, which simply identifies "the entity that is provided a certificate of insurance as evidence of the insurance maintained by another entity" (IRMI, certificate of insurance; IRMI, certificate holder).

The mistake subcontractors make here is assuming the certificate performs the contract. It does not. ACORD, which publishes the standard certificate forms, states that "A Certificate of Insurance is NOT an insurance policy, and does not serve to provide, endorse, amend, extend or alter in any way the terms of an insurance policy," and that "Reference to a contract between the client and a third party on a certificate does not provide coverage" (ACORD certificates FAQ, quoted in IRMI expert commentary, David Dybdahl, 2015, which quotes the ACORD page). So a line in the description box saying the holder is an additional insured with a waiver of subrogation creates nothing at all. The endorsements create it, and the certificate reports it. If you promised endorsements, make sure they were actually issued, and keep copies, because the day somebody needs them is the day the agency that wrote the policy has changed staff. The bonded and insured guide covers the other document clients confuse with this one.

Nearly all states require employers to carry workers compensation for employees, and the NAIC's advice is to check with the state, since requirements vary by state and business type (NAIC, Insure U: Small Business Insurance). The word doing the work is employees. A one-person business has none, so there is nothing for the policy to cover, and yet the requirement still turns up in the contract. The reason is on the other side of the table: the general contractor is managing exposure and an audit of their own, and the alternatives they will accept are usually a policy or a state-defined exemption or waiver form. Which one exists where you work is a state question and the state's workers compensation agency is the check.

Texas is the exception worth naming, because so much of this network's audience works there. The Texas Department of Insurance says private employers can choose to carry coverage and it "is not required in most cases" (TDI, employer resources). That is a state rule and not a contract rule: a general contractor in Texas can, and routinely does, require coverage the state does not. The trade-offs of declining are on the Texas hub. And the moment you put a helper on, the analysis changes in nearly every state, so the question of whether that helper is an employee or a contractor stops being paperwork. The general contractor vs subcontractor guide has the test the IRS applies.

What moves a subcontractor's number, and why the contract exhibit is part of it. The trade comes first, because a drywall sub and a roofing sub are not in the same conversation, and the trade pages on this site are organized on that difference. Then receipts and payroll, which are the usual rating bases. Then the contract exhibit itself, which is the part specific to subcontracting: the limits you are obliged to carry, whether completed operations additional insured status is required, whether waivers of subrogation are required, and how many general contractors you are attached to at once. Then residential against commercial, the heights you work at, your vehicles, the value of tools and materials you carry, your loss history, and your state. The lever you hold is sequencing. Send the insurance exhibit to your agent before you price the job, because a requirement discovered after the bid is a cost you have already agreed to absorb.