General liability premium estimator

Contractor General Liability Insurance Premium Estimator

General liability insurance is non-negotiable for contractors — most GCs, owners, and municipalities require it before you set foot on a jobsite. But the premium varies significantly by trade, revenue, and payroll. This estimator applies ISO CGL rate factors by trade classification to give you a ballpark annual premium before you shop carriers.

What GL Insurance Actually Covers

The ISO CGL (Commercial General Liability) form covers two primary risks: bodily injury and property damage to third parties caused by your operations. Third party means anyone who isn't your employee — homeowners, bystanders, neighboring property owners, the general contractor's other subs.

Common covered scenarios: a homeowner trips over your saw horse; your crew's concrete saw cuts through a buried utility; water from your plumbing work migrates into a finished unit below. The key word is third-party — your own employees and your own property are covered by different policies entirely.

What GL Does NOT Cover

Understanding exclusions is as important as knowing what's covered. GL does not cover:

• Your employees' injuries — workers' compensation is a separate, legally required policy in most states. GL explicitly excludes employer liability.
• Your equipment and tools — inland marine (equipment floater) covers your owned and rented equipment. GL won't pay to replace your stolen generator.
• Faulty workmanship itself — the cost to redo your own defective work is generally excluded (this is what contractor's professional liability or a warranty covers). The resulting damage to the rest of the structure caused by your faulty work may be covered, but this is a contested area — read the policy language carefully.
• Design and specification errors — if you provide design-build services or engineer your own layouts, errors and omissions / professional liability is a separate policy.

Occurrence vs. Claims-Made

This distinction matters enormously for contractors. An occurrence policy covers bodily injury and property damage incidents that happen during the policy period, regardless of when the claim is filed. A claims-made policy only responds if the claim is filed while the policy is in effect.

For contractors, occurrence is strongly preferred. Construction defects often take years to manifest and longer to litigate. A roof you installed in 2024 may not produce a water damage claim until 2027. With an occurrence policy, your 2024 carrier is on the hook. With claims-made, you'd need to carry the same policy (or purchase tail coverage) all the way through the statute of limitations — often 10+ years for construction defect claims.

The ISO CGL Form and How Rates Are Set

Most carriers use the ISO (Insurance Services Office) CGL form as their policy template. The ISO publishes classification codes for hundreds of contractor types, each with an associated rate per $1,000 of revenue or payroll. Underwriters adjust these rates based on claims history, years in business, and safety programs. The rates used in this estimator are representative of the ISO classification framework — actual quotes from carriers will vary.

Additional Insureds and COIs

Every GC or property owner you work for will ask for two things: a Certificate of Insurance (COI) listing them as a certificate holder, and an Additional Insured endorsement adding them to your policy. The endorsement matters because without it, the COI just confirms you have coverage — it doesn't extend coverage to them. Most carriers add additional insured endorsements for free or a nominal charge. Maintain a system for tracking which jobs require which endorsements and get your agent to issue updated COIs promptly when new contracts require it.

Umbrella and Excess Liability

An umbrella policy sits above your GL, auto, and workers' comp policies, extending limits when any underlying policy is exhausted. A $1 million umbrella over a $1M per occurrence GL policy effectively gives you $2M per occurrence for incidents that trigger the umbrella. Most commercial project specifications require $5–10M in umbrella limits. The cost is typically $500–1,500/year for the first $1M of umbrella limit — inexpensive relative to the exposure it covers.