While many independent contractors buy insurance for themselves, you may need to provide some types of insurance for the contractors you hire as a way of covering their liabilities and your own.
Does my small business insurance cover independent contractors?
If your independent contractors need coverage, you can add an independent contractor to your own insurance coverage as an additional insured, either for a single event or for as long as you have the policy. You can do so by notifying your insurance provider, and your premiums or deductible may be adjusted to account for this.
What insurance coverage am I required to carry for independent contractors?
If an independent contractor is not insured, you may be held liable for any lawsuits related to their work, whether it’s for an injury caused by an accident, illegal behavior, or poor workmanship.
Commercial auto insurance is required in most states for any business-owned vehicles. If a contractor is driving a vehicle owned by your business, you ought to make sure they’ll be covered in case of an accident.
If they are often driving their own business vehicle, then it may also be a good idea to ensure they have their own coverage in place. You could ask your contractor to show a certificate of insurance as proof of coverage.
Top business insurance policies for independent contractors
Do I need workers’ compensation for my contractors?
Workers’ compensation insurance is required in most states for any business with employees. For more dangerous occupations, such as construction contractors, workers’ comp may be required for anyone working on a job site.
Workers’ comp covers work-related bodily injury and illness, which are unlikely to be covered by regular health insurance. Workers’ comp not only covers medical expenses, it can also offset lost wages if someone is unable to work.
Workers’ compensation coverage is available for independent contractors, but not all contractors buy this for themselves. If you’re a general contractor, you may have to provide this coverage for your subcontractors, depending on the type of work they do.
Make sure to check with your insurance company and your state’s workers’ comp laws to ensure that your business, employees, and contractors are protected.
