Most contractors know they “have liability”. Fewer know where it stops. The fastest way to see the edges of a general liability (GL) policy is to walk through what actually goes wrong on a job.
New to GL? Start with What is general liability insurance for contractors in Ontario?
Where GL usually responds
Someone gets hurt who doesn’t work for you.
A homeowner’s kid trips over a toolbag in the hallway. A tenant walks under your ladder in a stairwell and gets hit by a falling bracket. GL is built for injuries to third parties: clients, neighbours, passers-by.
You damage someone else’s property while you work.
A plumber’s fitting lets go and floods a finished basement. A painter knocks a client’s mirror off the wall. A landscaper’s trimmer throws a stone through a car window. GL can respond to damage you accidentally cause to property that isn’t yours.
Something goes wrong after the job is done.
An electrical connection fails weeks later and starts a fire. A deck railing gives way at a barbecue in July. Claims that show up after you’ve packed up and left are called completed operations, and they’re one of the main reasons GCs want to see GL on a sub’s certificate.
A product you supplied or installed causes harm.
A fixture you sourced and installed shorts out and damages the unit. If your work includes supplying materials, products liability is the part of GL that deals with it.
Your advertising lands you in trouble.
You use a photo from another company’s website on your flyer, or a competitor says your ad copied their slogan. Some GL policies include advertising injury cover for claims like these.
The cost of defending a claim.
In most policies, legal defence costs for a covered claim are included, even if the claim turns out to be unfounded. Check how your policy treats defence costs against your limits.
Where GL usually doesn’t respond
Your own crew. If an employee falls off a ladder, that’s a workplace injury. In Ontario it goes to WSIB, not your liability policy.
Your own tools and equipment. A trailer of tools stolen from a driveway overnight isn’t a GL claim. That’s Tools & Equipment cover, which is coming soon through Worksured.
Your truck or van. An accident on the way to a job is a Commercial Auto question. Commercial Auto through Worksured is coming soon and will be quoted separately.
Redoing your own work. A roof you installed leaks and stains the ceiling below. GL may respond to the ceiling. Replacing the roof itself is usually a different matter, and each policy draws that line in its own wording.
The project itself while it’s being built. Damage to a building under construction from fire or weather is a Course of Construction question. Course of Construction through Worksured is coming soon.
Intentional damage. Damage or injury caused on purpose isn’t covered.
Design work and professional advice. If you also design systems or give paid advice, standard GL may not respond to claims about that advice. Tell your broker about that part of your work.
Contract terms that go beyond the policy. Some contracts ask you to take on more liability than a standard GL policy covers, for example broad hold-harmless or indemnity clauses. Read the insurance section of any contract before you sign, and ask a licensed broker if the wording asks for more than you carry.
The gaps that catch contractors out
- The limit the contract asks for is higher than your limit. Check the contract before choosing one.
- The work changed, the policy didn’t. If you’ve added a service since your last renewal, your policy may not reflect it. See What GCs ask from subcontractors in Ontario on multi-trade work.
- The certificate doesn’t match the contract. Name, limit, dates and any additional insured all have to line up (see Additional insured explained).
Questions contractors ask
Does general liability cover damage that shows up after the job is finished?
Usually yes, under completed operations, subject to your policy wording and limits.
Does general liability cover my employees if they get hurt?
No. In Ontario, injuries to your own workers go to WSIB.
Does general liability pay to fix my own mistakes?
Generally not the cost of redoing the work. It may respond to damage your work caused to other property.
All insurance policies have coverage limitations and should be reviewed. Coverage is subject to the terms of your policy.
This article is general information about insurance for contractors and tradespeople in Ontario. It isn’t advice about your business or your policy. All insurance policies have coverage limitations and should be reviewed. Coverage is subject to the terms of your policy. Coverage is not considered bound until you have received confirmation from a licensed broker. [TO CONFIRM: bound line depends on the issuance process]
[TO CONFIRM: add once licensed: “Worksured Insurance Group is a RIBO Licensed Insurance Broker.”]