What Insurance Coverages Should You Require from the Subcontractors You Use?

For New York contractors, the importance of obtaining and verifying insurance information from subcontractors cannot be overstated. Many contractor insurance policies have specific minimum requirements, and failure to adhere to these can result in a lack of coverage if a claim arises. This article outlines critical insurance information that contractors should obtain from their subcontractors to ensure compliance and protect their interests.

1. Written and Signed Insurance and Hold Harmless Agreement

Before any work commences, it is crucial to have a written and signed insurance and hold harmless agreement with each subcontractor. This agreement helps to clearly define the responsibilities and liabilities of each party, ensuring that the contractor is protected from potential claims arising from the subcontractor’s work.


Maintaining comprehensive records is essential. Contractors should keep these agreements and other relevant documents on file for each subcontractor. Proper documentation is vital during audits, allowing auditors to accurately record and verify the information.

2. Liability Limits

The liability limits required from each subcontractor should align with the mandates of the contractor’s liability policy. Some contractor policies stipulate that the subcontractor’s liability limit must be at least equal to or exceed the contractor’s policy limit. Ensuring that subcontractors meet these requirements is crucial for maintaining proper coverage.

3. Additional Insured Status

Contractors should require that they are listed as an additional insured on the subcontractor’s liability policy. This designation ensures that the contractor is protected under the subcontractor’s policy in the event of a claim.

Compliance with Additional Insured Requirements

If several parties need to be listed as additional insureds, contractors must verify that the subcontractor’s additional insured coverage complies with their policy requirements. Not all subcontractor policies provide adequate coverage for multiple additional insureds, so this should be checked meticulously.

4. Primary and Non-Contributory Coverage

Contractors should require primary and non-contributory coverage from their subcontractors. This ensures that the subcontractor’s insurance will be the primary coverage in the event of a claim, with the contractor’s insurance only contributing once the subcontractor’s coverage is exhausted. This provision helps to protect the contractor’s insurance policy and maintain lower premiums.

5. Contractual Liability Coverage

Contractual liability coverage is another critical requirement. This type of coverage protects the contractor if they are held liable for certain obligations under a contract with the subcontractor. Ensuring that subcontractors have this coverage is essential for comprehensive risk management.

6. Labor Law Coverage

Labor law coverage is particularly important in New York due to stringent labor laws that can impose significant liabilities on contractors. Many subcontractor insurance policies, because of cost, do not include this coverage, but it is vital for protecting against claims related to labor law violations. Contractors must ensure that their subcontractors have labor law coverage, and if not, they may need to consider using different subcontractors who do.

7. Subcontractor Insurance Screening Services

Some contractor liability companies now require the use of subcontractor insurance screening services. These services, provided by third parties, help to verify and ensure that subcontractors meet all insurance requirements. While there may be a charge for this service, it provides an additional layer of protection by confirming that subcontractors have the necessary coverage in place.


Ensuring that subcontractors meet specific insurance requirements is vital for New York contractors. From signed agreements and liability limits to additional insured status and labor law coverage, each element plays a crucial role in protecting the contractor’s interests. By working with a knowledgeable partner like BGES Group, contractors can navigate these requirements with confidence and focus on their core business operations.

Why Work with BGES Group?

For New York contractors seeking expert guidance and support in managing subcontractor insurance requirements, BGES Group is an excellent choice. As specialists in New York construction insurance, BGES Group offers personalized, boutique-style service. They limit the number of accounts they service to ensure each client receives dedicated attention.

Gary Wallach, a veteran insurance expert with BGES Group, can provide the expertise and support needed to navigate the complexities of subcontractor insurance requirements. To learn more or to get started, contact Gary Wallach at 914-806-5853 today.

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