General Liability Insurance
Insurance covering third-party bodily injury, property damage, and the legal costs of defending related claims arising from a contractor's operations, the baseline coverage nearly every construction contract requires a contractor to carry before work can even start, evidenced to the other parties through a [[concept-certificate-of-insurance|certificate of insurance]].
Why it matters
General liability is what actually stands behind an [[concept-indemnification|indemnification]] clause in practice. A contractor's promise to indemnify the owner against third-party claims is only as good as the insurance backing it, so owners require both the contractual promise and proof of the coverage that can actually pay out on it.
On a real project
A piece of debris falls from a jobsite and damages a parked car belonging to a passerby. The contractor's general liability policy covers the cost of repairing the car and any related legal claim, rather than the contractor having to pay the claim out of pocket.
Who this matters most to
A Safety Manager tracks incidents that could turn into general liability claims and coordinates the documentation an insurer needs to process one. A Contracts Administrator verifies that every subcontractor's certificate of insurance shows adequate general liability limits before allowing that subcontractor onto the jobsite, since a gap in a subcontractor's coverage can expose the general contractor's own policy to claims that should have been the subcontractor's responsibility.
Where this goes wrong
A general contractor allows a subcontractor to start work before confirming their certificate of insurance actually names the GC as an additional insured on the subcontractor's general liability policy. When a third party is later injured by that subcontractor's work, the GC discovers their own policy has to absorb a claim that should have been covered by the subcontractor's insurance, because the paperwork was never actually verified.
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