Does My Business Insurance Cover Independent Contractors

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If you own a business, chances are you engage independent contractors for various tasks.

Even though these contractors aren’t considered employees, they represent your business and are susceptible to potential risks that might affect your operations.

In this guide, we’ll assist you in determining if your business insurance extends to cover independent contractors and explore the types of policies that can offer the necessary protection.

Does my business insurance cover independent contractors
Business insurance usually excludes independent contractors as they’re not company employees. But some policies might cover specific actions of contractors working for you, depending on policy terms: Photo source (Insuranceopedia)

Does Business Insurance Cover Independent Contractors?

The coverage for independent contractors depends on your insurance policy and business type.

Generally, policies covering employees may also cover contractors working for your business.

However, nuances exist. General liability insurance can cover contractor-caused injuries or property damage, except for intentional damage or criminal activity.

Workers’ compensation insurance, designed for employees, doesn’t cover independent contractors.

Contractors require their own workers’ comp policy.

Types of Business Insurance that Cover Independent Contractors

Certain business insurance policies cater to independent contractors, even though not all types of business insurance offer this coverage.

Here are a few to consider:

General Liability Insurance

This insurance offers coverage for bodily injury or property damage caused by an independent contractor working for your business.

It safeguards your business against lawsuits and claims arising from the contractor’s actions.

Professional Liability Insurance

Also known as errors and omissions insurance, this policy provides coverage if an independent contractor delivers subpar work on your behalf.

It protects your business from legal claims resulting from the contractor’s mistakes or omissions.

Commercial Auto Insurance

When independent contractors use their vehicles for work, their personal auto insurance might not cover work-related accidents.

Commercial auto insurance steps in, offering coverage for accidents or damages occurring while the contractor uses their vehicle for your business.

Umbrella Insurance

Umbrella insurance supplements your primary policies by providing extra liability coverage.

If your business involves independent contractors, considering an umbrella policy can offer additional protection.


Does my business insurance cover independent contractors?

Coverage varies based on your policy. Some may include independent contractors, so review your policy and consult your agent for clarifications.

Which business insurance policies cover independent contractors?

Policies like general liability, professional liability, and workers’ compensation (if contractors have their own) can provide coverage. However, specifics depend on your policy and business type.

How does business insurance protect my business with independent contractors?

Insurance covers risks like injuries. For instance, workers’ compensation can handle medical expenses if a contractor is injured on the job.

Do I need to provide insurance for independent contractors?

Generally, contractors obtain their own coverage.

Clients might request specific insurance types. Consult legal and insurance advisors for your requirements.

What factors should I consider when hiring independent contractors?

Evaluate their experience, qualifications, availability, work nature, licenses, and insurance.

Prioritize contractors with a history of high-quality work.

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