Why You Should Get California Contractor License

Why You Should Get California Contractor License

A government-issued license is one of the basic requirements to operate as a contractor or subcontractor in the United States. In California State, the license is issued by the Department of Consumer Affairs, Contractors States License Board (CLSB). Without a license, you cannot work on any project that has a total cost of $500 and above, including labor and materials.

This applies to contractors, specialty contractors, subcontractors, and anyone engaged in the business. You must be licensed to submit a bid for any project worth that amount within the state. The rule applies to all businesses or individuals who construct or alter any structure such as building, road, highway, parking facility, or excavation, railroad.

What are the Benefits of Becoming a California Contractor License?

Apart from being a requirement of the law, the following are some of the benefits you stand to gain if you become a licensed contractor in California:

It Gives Your Brand Credibility

If you desire growth and expansion of your firm in this Land of Milk and Honey, then becoming licensed is a must. Prospective customers often do a background check before offering their projects to a contractor. It gives a credible first impression of you. For instance, having your license number proudly displayed on your business card will make people trust your brand as legit and reliable.

It Helps Your Business Grow

It also allows you to bid on larger projects that require a license. Also, without a license, you cannot submit a bid for public works job.

In addition, there are some projects that will require taking a loan to complete them. Your license will be one of the first things you will be asked to present before you can get a loan from any financial institution, such as banks.

Get More Hands for Your Project

It also allows you to hire more workers to get a project done in real time. Without a license, you may face legal action for not carrying worker’s compensation insurance. Remember, workers comp is part of the requirements for the California contractor license.

Helps You Get Paid for the Work Done

As a licensed contractor, you have nothing to worry about in terms of being paid after delivering a project in accordance with the contract signed with your customer. For example, if a customer tried to outsmart you or deny you of your due payments, you have all the right to use the court to get your money. This is a privilege that cannot be leveraged by an unlicensed contractor. Also, under the Business and Professional Code section 7031, a customer is allowed to reclaim all money paid to any unlicensed contractor. This is a situation that could bankrupt a business, especially if you have spent lots of money and time executing the project.

Steps to Getting California Contractor License

In all, the process involves seven (7) different stages as follows:

Step I

Determine if You Are Eligible: You must be at least 18 years of age, have a minimum of 4 years journeyman level work.

Step II

Complete Application: Here, you will be asked to choose a license application that pertains to your specific line of business. All application forms will require filling in your Individual Taxpayer Identification Number or a Social Security number.

Step III

Submission of Application and Fees Payment: Your application must be submitted with a fee of $300

Step IV

Fingerprint: The CSLB will review your application. After this, you will be asked to undergo fingerprint screening as part of the board’s mandatory criminal background check.

Step V

Work Experience Verification: You will be required to present certain documentation to confirm if you meet the minimum work experience requirements.

Step VI

Examination: You will have to take and pass written law and trade examinations unless you meet the requirements for a waiver.

Step VII

Get Your License: If you have passed the exam or received a waiver, you will be issued your license. Eureka! You have become a licensed contractor in the Golden States!

Understanding California Contractor License Classifications

Apart from being a compulsory requirement of the law, having a contractor license increases your chances of winning a project bid in California State. Depending on your line of business, your California contractor license will be issued under any of these three business and professional code classifications: A Class, B Class, or C Class.

Classification A: General Engineering Contractor: 7056

You will be classified under this category if your main contracting business is in connection with fixed works that require specialized engineering skill and knowledge. This includes the individuals and businesses in divisions like drainage, irrigation, flood control, water supply, and inland waterways, harbors, docks and wharves. Others are shipyards and ports, dams, reclamations, works, railroads, etc.

Classification B: General Building Contractor: 7057

A general building contractor is someone whose contracting business relates to a structure being built or modified. You will need this classification if the project requires two or more different trades or types of subcontractors. As a general contractor with this California license code, you may also take a subcontract or prime contract for carpentry or framing project.

Classification C: Specialty Contractor: 7058

The California Class C license code is for specialty contractors who are into crafts or trades that do not fall within the scope of a general contractor. Such include those who engage in services and testing of fire extinguishing systems, installation and laying of resilient floor covering, carpets, linoleum, etc. Those who specialized in roofing, plumbing, concrete, and heating, ventilation, and air conditioning (HVAC) will also be under this category.

Eligibility for California Contractor License

California contractor licenses are issued by the Department of Consumer Affairs Contractors State License Board. To become a licensed contractor, you will need to be at least 18 years old, present evidence of $15,000 bond, and be a citizen or legal resident in the United States. Other requirements include fingerprint screening as part of the criminal record background check. Additionally, you must pass the basic license examination or qualify for a waiver.

Getting Additional Classification

Additional classification is allowed if you have an existing license. You can add any of the three above classification to the already existing license, provided you have the skill set for the intended additional category and meet the examination requirements. You may also remove a classification from your license if you feel it is no more needed. Keep in mind that to re-add a removed classification to your license, you will need to reapply for it with a fee.

Other Licensure Application Types

Apart from the above three classes, there are other trades that require certifications. If you perform any of the following along with your specialization, you will need to get them, more like additional classification to your existing license:

-       Home Improvement Salesperson (HIS)

-       Asbestos Contracting Works

-       Hazardous Substance Removal and Remedial Actions Work

California Contractors License Requirements

Each of the 50 states in the United States has its own laws that contractors must comply with. In California State, the Department of Consumer Affairs, Contractors States License Board (CLSB) is saddled with this responsibility. The board is also responsible for administrative services to contractors and their clients and investigating related complaints.

California Contractor License Requirements

To become a licensed contractor in the Golden State, you will need to:

-       Be at least 18 years of age

-       Be a U.S. citizen or legal resident

-       Provide passport photographs

-       Hold a $15,000 worth of bond

Who Needs the License?

According to the CLSB, becoming licensed is a must if you are to work on a project with the total cost (materials and labor) of $500 and above. This involves all businesses or individuals who construct or alter any structure, such as building, road, highway, parking facility, excavation, or railroad. The requirement applies to contractors, specialty contractors, subcontractors, and anyone engaged in the business. It is a major prerequisite that must be fulfilled before you can submit a bid for a project within the state.

Penalties for Working Without a License

Being an unlicensed contractor is a gross violation of the California state law. It can lead to criminal or civil actions against any offender. If you are caught contracting jobs or advertizing yourself as a contractor for jobs worth $500 and above, the CSLB will initiate legal or criminal action against you up in the following ways:


This is usually treated as a misdemeanor, carrying a possible sentence of up to 6 months in jail and/or a fine of $500. Depending on the outcome of the investigation, it can also attract a potential administrative fine $200 to $15,000.


Subsequent convictions will increase the penalties, which could cost a fine of 20% of the total price of the project done, or a $4,500 fine. Such an offender shall also be confined to jail for at least 90 days.

It is, therefore, highly recommended to get the license and avoid legal actions that could lead to a setback for your business. The consequences can also ruin your overall trajectory and long-term projection.

What if I Don’t Meet the Requirements for a License?

If you do not meet the California licensing requirements for contractors, you may qualify for a license under a “qualifier.” A qualifier, according to CSLB, is a person captured on the board’s records who meets the requirements for a license.

Can I Work in Another State With California Contractors License?

California has contractor license reciprocity with Utah, Arizona, and the Nevada States. If you are to work in any of these states with CSLB license, or vice versa, you stand a higher chance of landing the job than in other states. This doesn’t automatically guarantee you the right to work contract with those state’s license, but it removes some of the requirements in the license examination.

The advantage will help fast-track the bidding process as you get to complete the whole process ahead of other potential competitors. You might also qualify for a waiver for some of the examination requirements. Bear in mind that reciprocity agreement doesn’t work in all classifications of California contractor license. It is awarded only in specified, similar classifications. For example, Arizona license code A-21 for landscaping will be accepted as equal to California landscaping license code C-27. Any contract outside the accepted code will not be authorized.

Excess and Umbrella Insurance Explained

Excess and umbrella liability are common terms in the general liability, commercial auto, and employer’s liability insurance industries. Because the two policy types can fit perfectly into different branches of the insurance industry, many people confused them one for another. While they are sometimes used interchangeably, a closer look at the two will clearly show that excess and umbrella policies are not one or the same.

Excess Liability Insurance Defined

Excess liability, in its purest form, provides coverage above the limits of an underlying liability policy. Its primary purpose is to add some layers of protection if the underlying policy is exhausted. If for instance you have an insurance policy that only covers $500,000 damages, and there is a lawsuit where you are liable of $700,000 loss, you will be allowed to file claims for the excess liability of the remaining $200,000.

Umbrella Insurance Defined

Umbrella insurance is a type of policy that provides coverage beyond and above the standard liability limits. It serves almost the same purpose as excess liability insurance, but with some more inclusions.

To enjoy an umbrella insurance coverage beyond the underlying policy, you will need to pay self-insured retention (SIR). A SIR is the dollar amount agreed upon in liability insurance which you must pay before an insurance company responds to the loss. Once you have paid to the tune of the SIR, your insurer will take on the rest.

What is an Underlying Policy By the Way?

The underlying policy is the insurance coverage set at the initial stage of a policy to protect against specified risks and losses. Secondary policy provisions like excess liability and umbrella policy come into play when the damage is more than the established coverage.

What Are the Key Differences Between Excess and Umbrella Policies?

The major difference between the two is as follows:

Excess Liability

It provides you with additional limits to the underlying policy without affecting the actual terms of the contract. For example, if your excess liability is for general liability insurance, you cannot use it for another policy. Keep in mind though that this may not be the case if a policy includes additional exclusions.

Umbrella Insurance

On the broader (plus side, if you will), umbrella insurance can provide additional coverage in cases outside the scope of the underlying policy.

Why You Need an Umbrella or Excess Liability Insurance

With the increased rate of lawsuits emanating from liability and damages, there has not been a time when extra coverage is more needed. Lawyers are now charging hundreds of dollars per hour. Furthermore, there are financial responsibility laws that hold people accountable for damages and injuries caused by their businesses or properties, in almost all the 50 states. Most basic insurance policies have limits. Without extra coverage, your business could experience a bankruptcy as a result of loss from just one lawsuit. You may also lose your personal assets along the line. It is, therefore, a necessity to have some levels of buffers in your risk management approach.

Contractors Insurance: The Importance of Additional Endorsements

It does not matter which sector you operate in as a contractor, the need for financial protection cannot be overemphasized. Apart from meeting the requirements of the law, having a contractor’s insurance policy will help protect you against liability from damages and lawsuit.

How Does It Work

Contractor insurance primarily serves as a risk management tool that gives financial protection when your business is involved in peril or accident that causes financial loss. It is a contract between a firm and an insurance company. You will be charged a specified premium amount as the cost for the financial coverage, which will be provided by the insurance company in the eventuality of damages. You will have the liberty to choose the kinds of disasters or accidents you would want protection for, which will basically depend on your needs, budget, and/or preferences. The financial coverage will be offered according to the dictates of the contract signed.

Additional Insured Endorsements for Contractors

In most cases, basic contractor insurance policies don’t offer robust coverage that will best serve policyholders’ business interests. There are some projects you will need to subcontract, and would like to have coverage for as many subcontractors working with you. Your basic contractor insurance will not cover those subcontractors; hence, the need for additional endorsements to fill the vacuum.

How to Get Additional Endorsement

Just like every other insurance policy, getting additional endorsement comes with certain requirements, restrictions and complications, which must be understood from the onset.

To start with, you will need to define those you want to add in the endorsements clearly. The added insured can be an individual or an organization. There are different languages for additional endorsements for different purposes. You may get it for ongoing operation or completed operation.

Ongoing Operations

The language (terms and conditions) of an ongoing operation will be amended to accommodate the added insured individual or organization in the “WHO IS INSURED” definition of the contract. It will only address liability or loss arising from ongoing operations caused by the named entities.

Completed Operations

Completed operation option provides coverage against liability, loss, or injury to a third party once the contracted operation ceases. It is a crucial financial tool that provides relieves and helps you maintain stability in your business. Take, for instance, a roofing project you completed six months ago started linking, and you are sued by the property owner. Instead of dolling out repair cost from your pocket, your completed operation additional endorsement will come to your rescue.

If any lawsuit emanates from the contract, court judgment will be based within the scope of the language in the contractual agreement. It is therefore essential to understand the terms of a policy to the letter.

Blanket Additional Insured Endorsement

Also known as an automatic endorsement – blanket additional insured endorsement is designed to automatically accommodate those entities or individuals that were not initially named in the agreement.

Who Needs Additional Insured Endorsement?

An additional insured endorsement is a must-have debt management tool for every small, medium, and large scale contractor in the United States. Having it will help save your business from distress and bankruptcy resulting from a lawsuit.

What Is A Surety bond?

What Is A Surety bond?

A surety bond is a contractual agreement that involves three parties, namely the principal, the surety, and the obligee. It is a risk management plan primarily designed to ensure commitment towards an agreement in business practices. If you are a contractor, you may not be able to bid for or get some contracts without a surety bond. Also, as a business owner, a surety bond will be required in some legal claims and to obtain certain licenses.

Understanding the Three Parties In a Surety Bond Agreement

  1. The Principal

The principal is the entity (business or individual) in need of a surety bond as a form of guarantee for future work performance. A surety bond is used for different purposes, such as getting a business license, completing a court case, guaranteeing business protection, or completing a contract. If there are damages or a breach of contract on the part of the principal, the claims will be settled by the company that issued the bond.

  1. The Obligee

The obligee of a surety bond is usually a legal entity, such as government agencies. It is the entity that requires a surety bond from a business outfit before offering them a contract. This is in line with the Miller Act passed in 1935, which helps protect the public interest from local contractors. The surety bond will help reduce the likelihood of financial loss and ensure commitments to contractual agreement from the principal.

  1. The Surety

The surety is a risk management company (usually an insurance carrier or a bank) that is responsible for the bond payment if there is a damage caused by the principal. If the obligee files acclaim for damages, the surety will initially cover the cost. With that, the interests of both the principal and the obligee will be timely protected. Although, the full cost of the damages will still be fully paid back by the principal, but at a later date.

How Does a Surety Bond Works?

There are thousands of bonds in the US regulated by each state government. Amounts and requirements are dependent on what applies in a state. Surety bonds are broadly categorized into two types, namely contract and commercial surety bonds.

  1. Contract Surety Bonds

Contract surety bonds usually required by government agencies to serve two primary goals. It helps ensure that a contractor completes a project he undertakes. Also, it helps to ensure subcontractors are paid the agreed sum by the contractor. It has three major types, which are:

-       Bid Bonds: A bid bond is used when bidding for a contract. It is to show that your company is financially capable and has all the required resources to get the job done.

-       Performance Bonds: If you are choosing for the project, you will be required to present a performance bid to guarantee satisfactory completion of the project. In case of failure to complete the job as agreed, the surety company will be held responsible for the completion.

-       Payment Bonds: If all things went as planned and the project is completed, then you will need to pay your subcontractors. A payment bond is to ensure that all parties that worked on the projects are as agreed.

  1. Commercial Surety Bonds

There are thousands of bond types under this category, and each is named after its purpose. They are mostly required in license or business registration, or legal cases. Examples are License and Permits Bonds and Court Bonds


What is DOT Number?

A DOT or United States Department of Transportation Number is issued by the Federal Motor Carrier Safety Administration (FMCSA). It is a unique identifier assigned to companies operating commercial transportation services, either for cargo haulage or transporting of passengers. The primary role of FMCSA is to improve highway safety for all road users. The agency uses the DOT number for different purposes. They include compliance reviews, audits, collecting safety information, crash investigations, and compliance reviews for certain vehicles engaging in interstate commerce. Registering a USDOT number involves several requirements, and one of the basic requirements is insurance coverage.

Do I Need a DOT Number?

You will be required to file a USDOT number in most states in the United States if you own a commercial vehicle that:

-       Weighs more than 10,000 pounds

-       Plies the interstate routes

-       Transports up to 8 passengers for payment

-       Transports  more than 15 passengers for compensation, even if you don’t carry them for payment

-       Transports materials deemed hazardous by the Secretary of Transport

Operating Authorities Under FMSCA

A certain amount of insurance coverage is required to get an operating license and meet other obligations in the US commercial transport industry. As a commercial vehicle operator, the type of operation your company can run, types of cargo you are permitted to carry, and the insurance requirements will be dependent on which operating authority granted to you by FRSCA. The following are some of the operating authorities under FMSCA:

-       Household Goods Motor Carrier: This is for vehicles that transport household goods for general household use from factories or stores.

-       Motor Carrier of Property (Except Household Goods):  This authority is granted to for-hire motor carriers transporting regulated goods, except household goods.

-       Broker Household Goods: This applies to individuals, corporations, or partnerships that arrange transportation of household goods for compensation.

-       Broker of Property: This is for individuals or companies that arrange transportation of property for compensation, except household items.

-       United States-Based Enterprise Carrier of International Cargo

-       United States-Based Enterprise Carrier of International Cargo (Except Household Goods)

Having ascertained the type of operating authority your company requires, you will need to obtain and submit proof of the appropriate insurance coverage to the FMSCA in order to get a USDOT number.

Types of Insurance Coverage Required for FSCSA Registration

Most of the operating authorities explained above have various types of amount of insurance coverage requirements. Some of them are:

-       Public Liability Insurance: This is meant to cover liabilities from property damage, environmental restoration, and bodily injury. The required coverage amounts are  $750,000 to $5 million for freight, $3,000 for non-hazardous freight transported in vehicles weighing 10,000 pounds or less, and $5,000,000 for passengers.

-       Proof of cargo insurance: This is required for both household goods motor carriers and freight forwarders. The coverage amount is $5,000 per vehicle and $10,000 per occurrence.

-       A Surety Bond: This is for both brokers of freight and freight forwarders. A surety bond of $75,000 and a trust fund agreement of $75,000.

-       Service of Process Agents for all operating authorities

-       Endorsement for Motor Carrier Policies of Insurance

After completing your registration, your operations will be monitored under the New Entrant Safety Assurance Program for 18 months. If after the 18 months, you are deemed to be compliant with the regulations, you will then be issued a permanent operating authority.

Business Owners Insurance Policy

Business Owners Insurance Policy 

A business owner policy (BOP) is a unique insurance type designed to protect major physical assets of a business, and also cover the business against liability risks. Business owner’s policy is sold is offered by property and casualty insurance companies and offers multiple types of coverage. Depending on the degree of physical damage to a commercial property or lawsuit from injured third-party, some events are capable of bankrupting your business, if you lack reliable adequate insurance coverage.  As a small or medium-sized business owner, your needs for business owner’s insurance cannot be overemphasized.

Why Do I Need Business Owner Insurance Policy?

Business owner policy has two packages combined in one policy, as it covers both commercial property and general liability. Damage to property and equipment, a lawsuit from third-party, and lack of working capital are three major factors that mostly affect the general performance of a business. These three crucial factors are what business owner policy covers as follows:

Commercial Property Insurance

Commercial property insurance protects your business against any damage to its physical assets due to vandalism, theft, fire or any kind of accidental damage. Your commercial building, equipment and fixtures are some of the properties generally covered by this product.

Liability Insurance Protection

Liability insurance covers any legal responsibility your business is held for as a result of harm done to others. This could be financial loss, bodily injury or property damage to third-person as a result of the failure or errors from your business activities.

Business Interruption Insurance

 If regular business activities are interrupted as a result of mechanical breakdown, fire or vandalism, theft or a covered disaster, a company without a reliable financial protection may be forced to slow down or stop operations. With business interruption insurance, the effects will be mitigated, and your company will be well protected. The coverage usually includes the income lost for that moment of interruption and the extra cost of operating from a temporary location.

How to Get a Business Owners Insurance Policy

Before buying a business insurance policy, the following are some of the things you need to consider:

Eligibility Criteria

As with other insurance types, BOP eligibility is determined by specific criteria, depending on the company and the product. Generally, for a business to be qualified, the requirements include:

-          Having less than 100 employees

-          The building size must not exceed 100,000 square feet or six  stories if it is an office

-          The building size must not be larger than 35,000 square feet if it is for wholesale, mercantile, or processing

-          The annual revenue must be more than $1 million

-          The business must be in a low-risk industry.

Talk to a Business Insurance Broker

Just like every other important financial decision, you must do your due diligence and grasp the concept of how BOP works for your business line. An insurance borker, preferably, an expert in the business insurance policy will help you have a better understanding of it and guide you on how to buy and make the most of your business owners policy.

Free Businessowners Policy Insurance Quotes

To save money on your business insurance policy, call Safepro Insurance Services and speak to a commercial insurance broker.

Builders Risk Insurance Explained

Builders Risk Insurance Explained

Builders Risk Insurance, which sometimes referred to as Course of Construction or Inland Marine Coverage, is a special type of property insurance. It is designed to cover a building that is currently under construction. Its coverage can be just for the building, or with other materials meant to be used for the construction; either at the construction site or at off-site storage locations and in transit.

Builders risk insurance policy can be purchased for either residential or commercial building project. The definitions of “residential” or “commercial” however, varies among the policy providers. For instance, some insurance companies may define a residential building as a family home for 1 to 4 numbers of occupants.  A commercial project could be anything from the shopping complex, office buildings, and sports arena. The policy is usually provided for three kinds of construction projects, namely:

-          Ground-up new construction;

-          Remodelling; and

-          Installation

How Does Builders Risk Insurance Work?

Just like every other insurance type, the builders risk insurance risk policy is a risk management financial plan, which pays for damages up to the coverage limit. The policy term could be for 3months, 6months, or 12 months, depending on the size of the project. In the event that the project isn’t completed when the policy expires, you can negotiate with your policy provider for an extension.

What Does Builders Risk Insurance Cover?

Damages from events such as fire, wind, explosion, vandalism, hail vehicles, are often covered by the policy. In some cases, limited coverage may be made available for building collapse. Comprehensive coverage may also include damages from events like earthquake, war, weather to property, mechanical breakdown, flood, and theft.

Keep in mind, however, that liabilities from injuries and accidents, and professional liability are excluded from the coverage. You may get stand-alone liability insurance for this purpose. Also, if you have subcontractors working on the same project, they will need to get their own insurance separately. The policy coverage is restricted to the building it is purchased for, and will not cover property belonging to other people.

Who Needs Builders Risk Insurance?

Builders risk is a crucial insurance policy that is essential for those who are into building construction. Having it will significantly help in averting potential financial loss from common damages in building construction. It will also help protect your reputation as a builder. You will most likely need builders risk insurance if you are a:



Homeowner or property owner

Development or investment company owner

House flipper

How Much Builders Risk Insurance Do I Need?

There’s no one-cap-fits-all to this. The budget for the building will determine how much policy you will need.   Generally, builders risk insurance price ranges from 1% to 4% of the total construction cost. The exact policy amount will depend on the number or the kinds of items you want the policy to cover. While you will want to be prudent with your budget, it is essential not to leave out crucial aspects, including soft costs of the project. This will guarantee adequate coverage when the need arises. When shopping for a builders risk insurance policy, do ensure that you patronize a reputable insurance company that will guarantee a prompt response to your claims.

In order to receive a quote on builder’s risk insurance, please click on the following link:





Commercial General Liability

Commercial General Liability Explained

A commercial general liability (GCL) is an insurance policy that protects you and your business from a financial loss. Your company may be liable for injuries or damages to a third party resulting from the services or products you offer to the general public. Liabilities do arise from accident, error (by omission or commission), or non-professional negligence that causes another person harm or financial loss. No matter how highly trained and professional you and your employees are, you can’t completely rule out certain unwanted and unforeseen circumstances.

How Does Commercial General Liability Work?

Commercial general liability is a risk management plan that specifically covers your business from claims from a third person. Depending on a company’s line of business, A CGL policy can be designed to cover different eventualities under the following basic categories:

-       Bodily Injury  Liability

If a customer or any other individual visits your business site and gets injured, you may have to cover the medical payment. Body injury coverage implies that certain negligence has caused the event. Sometimes you may not directly cause the injury, but so long it happens within your business premises, you may still be found legally negligent. For instance, the injured person may claim he slips because you fail to place warnings signs around the wet floor. CGL insurance policy covers hospital bills and nursing expenses for an injury. Also, it covers funeral expenses if someone is injured and killed in an accident on your business premises.

-       Property Damage Liability:

If your business is found liable for damages to a third party’s physical property either on or off-premises, the policy will help you mitigate the financial cost of the liability. Third party’s property damages could be directly from your business activity or from a product offer. For example, if a home appliance which your company produced malfunctioned and caused a fire incident to a buyer’s property. You may be liable under non-professional negligent acts.

-       Personal and Advertising Injury Liability:

This helps cover your company from any legal responsibility arising from business infractions such as libel, copyright infringement, false arrest, entry or eviction of privacy, and slander.

Who Needs CGL Insurance?

Every business owner needs a CGL policy to help secure their businesses from legal suit that can adversely affect their trajectory. Liability payment for just a single legal action against your business could cause an irrecoverable bankruptcy and reputation damage. You can prevent such by insuring your company with a CGL policy customized for your line of business. The policy can be bought as a stand-alone coverage, as part of Commercial Package Policy, or as part of a Business Owners Policy.   CGL policy is a must-have whether you are a contractor or a tradesperson.

Does CGL Cover Workers Compensation?

Insurance regulations for businesses often set a distinction between coverage for the general public and the employees. CGL is meant to cover third-person, and it doesn’t cover employment practices liability and workers compensation. A workers compensation policy, which also covers employers liability, can be bought as a separate policy.