How GC Subcontracts Specify Your Insurance Requirements — and How to Read Them

Every GC subcontract has an insurance exhibit — usually an attachment, schedule, or exhibit at the back — that specifies exactly what insurance you must carry to work on that project. Most contractors sign without reading it. That's a mistake that costs money and sometimes voids their protection when a claim hits.

Where to find the insurance requirements

Look for:

• "Exhibit [Letter]: Insurance Requirements"
• "Schedule of Required Insurance"
• "Section [X]: Contractor Insurance"
• Sometimes embedded in the General Conditions (often AIA A201 or ConsensusDocs format)

If you can't find it, ask before you sign. "What are your insurance requirements?" is a normal contractor question. The GC's project manager or safety director knows.

The standard requirement structure

Insurance exhibits typically list requirements in this format:

Commercial General Liability:

• $[X]M per occurrence
• $[X]M general aggregate
• $[X]M products/completed operations aggregate
• Additional insured: [GC name] on a primary and non-contributory basis
• Waiver of subrogation in favor of [GC name]
• 30 days' written notice of cancellation

Workers' Compensation:

• Statutory limits (per state law)
• Employers liability: $[X]K/$[X]M/$[X]M
• Waiver of subrogation in favor of [GC name]

Commercial Auto:

• $[X]M combined single limit
• Owned, hired, and non-owned autos included
• Additional insured: [GC name]

Commercial Umbrella/Excess:

• $[X]M per occurrence and aggregate
• Above scheduled underlying GL, auto, and EL
• Follow-form (adopts underlying terms)

Limit ranges and what they mean in practice

GL $1M/$2M: Standard for residential and light commercial. Most small contractors already carry this.

GL $1M/$2M + $5M umbrella: Common for commercial projects and mid-tier GCs.

GL $1M/$2M + $10M umbrella: Required on larger commercial, institutional, and some public works.

$10M+ umbrella: Large commercial, healthcare, government — sometimes stacked policies.

Workers' comp $1M/$1M/$1M EL: Standard; $2M EL is sometimes specified on complex projects.

When limits exceed what you carry, you have three options: (1) bind additional limits before signing, (2) negotiate the requirement with the GC, or (3) decline the subcontract. Option 3 is underused. Signing and ignoring the requirement creates real risk if a claim hits.

Key clauses to watch

Additional insured (AI)

The exhibit will specify who must be added as AI on your GL. It's usually the GC, the project owner, and sometimes the architect. It may also require AI status on your umbrella (verify your umbrella form allows it).

Two critical AI qualifiers:

• Primary and non-contributory: Your GL responds first before the GC's own GL. Without this clause, both policies contribute pro-rata. Most GC contracts now require P&NC — verify your AI endorsement says it.
• Ongoing vs. completed operations: AI endorsements come in two forms — CG 20 10 (ongoing operations during the work) and CG 20 37 (completed operations after the work). GCs typically want both. Check which endorsement form you're actually issuing.

Waiver of subrogation

This waives your insurer's right to sue the GC to recover claims payments. It protects the GC from being sued by your carrier after a covered loss. Required by most GC contracts, but your policy must specifically allow it — many require an endorsement to do so.

Per-project aggregate

Some contracts require that the GL aggregate resets on a per-project basis rather than being shared across your entire book of work. This requires a per-project aggregate endorsement. Without it, a large claim on Project A could exhaust your aggregate for all other projects simultaneously.

Certificate holder vs. additional insured

The contract may require the GC to be listed as certificate holder (receives cancellation notice) AND as additional insured (extends coverage). These are different. Certificate holder status is free and standard. AI status requires an endorsement and extends actual coverage.

What to do when your current policy doesn't match

1. Call your agent before you sign. Tell them the specific requirements and ask them to confirm your current policy meets them — or what it would take to get there.
2. Request endorsements in writing. Verbal assurance isn't coverage. Ask for the AI endorsement form (CG 20 10 / CG 20 37), the waiver endorsement, and the P&NC language in writing.
3. Check umbrella compatibility. If the contract requires AI on your umbrella, verify your umbrella form allows it. Some umbrella forms restrict AI status.
4. Factor the cost into your bid. If you need to increase limits or add endorsements to win this project, get a quote first. Don't bid blind.

The trap of matching limits but missing endorsements

Contractors sometimes focus exclusively on the dollar limits and miss that their policy doesn't include the required endorsements. Meeting the limit but missing AI status, waiver of subrogation, or P&NC language means the GC's risk transfer fails — and you may be in breach of contract even though you technically "have insurance."

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Contractors Choice Agency reviews subcontract insurance exhibits before you sign — at no charge. Call 844-967-5247 or get a quote online.