Protect Your Pennsylvania General Contracting Business with General Liability Insurance
Part of our guide to general contractors insurance in Pennsylvania.
When you sign a construction contract in Pennsylvania, you're often required to carry General Liability insurance. This coverage is foundational for nearly every small business, including general contractors. You need it to protect your business from third-party bodily injury, property damage, and advertising injury claims. In Pennsylvania, severe winter storms and flash flooding increase your risk of slip-and-fall exposure and property damage claims. Without General Liability, you're exposing your business to significant financial risk. General Liability is not the same as Workers' Compensation, Commercial Auto, or Professional Liability (E&O), which you may also need as a general contractor.
General Liability cost for general contractors in Pennsylvania
Illustrative monthly general liability estimate for a small general contractor operation in Pennsylvania. Actual pricing depends on revenue, payroll, coverage limits, claims history, and carrier. Get a personalized quote to see your real price.
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What General Liability Covers for General Contractors in Pennsylvania
General Liability insurance for general contractors in Pennsylvania covers third-party bodily injury, property damage, and advertising injury claims. This means that if a client or visitor is injured on your job site, or if you accidentally damage a client's property, General Liability insurance can help pay for the resulting claims. For example, if a passer-by slips on ice outside your job site in Pittsburgh and sues you for their injuries, General Liability insurance can help cover the cost of their medical bills and any resulting lawsuit. On the other hand, General Liability does not cover employee injuries, which are instead covered by Workers' Compensation insurance, or professional mistakes, which are covered by Professional Liability (E&O) insurance.
Do General Contractors in Pennsylvania Need General Liability?
While General Liability insurance is not legally required for general contractors in Pennsylvania, it is often contractually required by commercial clients, real estate developers, and lenders. Nearly every commercial construction contract in Pennsylvania will require you to carry at least $1 million in General Liability coverage, often with umbrella coverage. Without General Liability insurance, you may not be able to sign a contract or start work on a project. Furthermore, going without General Liability insurance exposes your business to significant financial risk, as a single lawsuit or claim can easily exceed $1 million. In Philadelphia, for example, the courts are known for being plaintiff-favorable, which means that you may be more likely to be found liable for a claim.
A Real General Liability Claim a General Contractor Could Face
On a humid morning in Philadelphia, a general contractor's employee accidentally damages a client's property while working on a job site. The client sues the general contractor for $200,000 in damages. Fortunately, the general contractor has General Liability insurance, which covers the cost of the claim. The insurance company pays out $200,000 to the client, and the general contractor avoids a significant financial loss. If the general contractor had not had General Liability insurance, they would have been personally responsible for paying the claim, which could have put their business at risk.
What General Liability Costs for General Contractors in Pennsylvania
The cost of General Liability insurance for general contractors in Pennsylvania can range from $40 to $110 per month, depending on factors like revenue, payroll, coverage limits, deductible, and claims history. For example, a general contractor with a high revenue and large payroll may pay more for General Liability insurance than a smaller contractor. Additionally, contractors who work in high-risk areas, such as Philadelphia, may pay more for insurance due to the increased risk of claims. To lower your premium, you can consider increasing your deductible, reducing your coverage limits, or improving your safety record. It's also important to shop around and compare quotes from different insurance companies to find the best rate for your business.
How to Get General Liability in Pennsylvania
To get General Liability insurance in Pennsylvania, you'll need to gather some information about your business, including your revenue, payroll, and coverage limits. You'll also need to decide on a deductible and coverage limits that meet your needs and budget. It's a good idea to work with an insurance agent who is familiar with the general contracting industry in Pennsylvania and can help you navigate the process. In cities like Allentown and Erie, you may be able to find insurance agents who specialize in general contracting insurance. Once you have all the necessary information, you can compare General Liability quotes from different insurance companies and choose the one that best meets your needs and budget. Have your revenue, payroll, and contract limit requirements ready, and compare General Liability quotes today.
Frequently asked questions
Will my General Liability premium jump after one claim?＋
Yes. Your premium may increase after a claim, depending on the circumstances. However, the increase will depend on the severity of the claim and your overall claims history. If you have a history of frequent or severe claims, your premium may increase more significantly. On the other hand, if you have a good safety record and few claims, your premium may not increase as much.
Can I get a COI same-day for a client?＋
Yes. Many insurance companies offer same-day COIs for general contractors in Pennsylvania. However, you'll need to provide all the necessary information and documentation to your insurance agent or company, and they will need to process your request quickly. Some insurance companies may also offer online COI requests, which can speed up the process.
Does a sole proprietor need General Liability?＋
Yes. As a sole proprietor, you are personally responsible for any claims or lawsuits against your business. General Liability insurance can help protect your personal assets, such as your home and savings, in the event of a claim. Even if you're a small business or sole proprietor, you can still benefit from General Liability insurance, especially if you work with clients or on job sites where there is a risk of injury or property damage.
What's not covered by General Liability?＋
General Liability does not cover employee injuries, which are instead covered by Workers' Compensation insurance. It also does not cover professional mistakes, which are covered by Professional Liability (E&O) insurance. Additionally, General Liability may not cover intentional acts or criminal behavior, such as vandalism or theft.
Can I cancel my General Liability policy at any time?＋
Yes. You can typically cancel your General Liability policy at any time, but you may be subject to a penalty or cancellation fee. You should also consider the potential risks of not having General Liability insurance, especially if you're working on a job site or with clients. If you're canceling your policy, you may need to provide proof of new insurance or a cancellation notice to your clients or contractors.
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Other coverages general contractors in Pennsylvania should know
This article is for general educational purposes and is not insurance or legal advice. Coverage requirements and pricing in Pennsylvania change over time and vary by business. Verify current rules with the Pennsylvania Department of Insurance and a licensed agent before purchasing a policy.