General Contractor Insurance in Ohio

All general contractors in Ohio must carry a minimum of $500,000 in general liability insurance, which is the most common type of contractor liability insurance. This policy protects contractors and construction businesses from legal expenses associated with common mishaps, such as customer bodily injuries and accidental property damage.

Counties and cities sometimes have their own requirements for this type of insurance, as do most commercial leases. For example, contractors who work in Columbus must carry liability insurance with limits of at least $300,000 for damages to a single person and $500,000 for one occurrence.

Adding commercial umbrella insurance can boost your coverage on general liability insurance and other policies.

Contractor general liability insurance also protects against costly advertising injuries, such as libel, slander, and copyright infringement. So, for example, if an employee at your business posts false negative comments about a competitor on social media, your policy would help pay for legal costs if the other business sues.

To comply with Ohio state laws, general contractors with employees must purchase workers’ compensation insurance. This includes companies that are headquartered in other states but operate in Ohio. Clients might also require you to carry this coverage.

Ohio is one of four monopolistic states for workers' comp, which means policies must be purchased through the state fund, the Ohio Bureau of Workers' Compensation (BWC).

Policies bought from the state fund do not include employer's liability insurance, which covers legal fees if an employee files a lawsuit blaming your construction business for an injury. You can still buy it as stop-gap coverage from a private insurer.

Workers' comp covers medical bills for work-related injuries and provides disability benefits while an employee is recovering and unable to work. It's especially important for those in high-risk professions, such as roofing, tree service, and carpentry.

Sole proprietors and others who are not required to carry coverage can still buy workers' comp for themselves. If you're injured on the job, your health insurance provider can deny the claim. That could leave you paying for an expensive medical treatment, or out of work with no recourse for your lost wages.

Commercial auto insurance is required in Ohio for all vehicles owned by your general contracting company. This policy covers financial losses from an accident that injures someone or damages their property. It can also cover vehicle theft, weather damage, and vandalism.

Auto insurance requirements for all Ohio vehicles include a minimum of:

• Bodily injury liability per person: $25,000
• Bodily injury liability per accident: $50,000
• Property damage liability per accident: $25,000 

If you drive your own vehicle for work purposes, or rent or lease a vehicle for business use, you'll need a separate policy called hired and non-owned auto insurance (HNOA). Your personal auto insurance policy won't cover incidents that happen while you're driving for work, with the exception of a commute.

As with other types of insurance, your county or city may require you to carry a specific amount of auto liability insurance. You may need additional coverage depending on the kind of work you do and the business vehicles you own.

There is no state-wide legal requirement for contractors to be bonded in Ohio. However, many counties and cities require contractors to purchase a surety bond before they begin work. Your clients might also require a bond.

A surety bond guarantees reimbursement if a general contractor fails to fulfill the terms of a contract. Unlike an insurance claim, this amount must be paid back to the company that issued the bond.

Different types of bonds act as financial guarantees for a contracting business. For example, you might need a bid bond to bid on a construction project, or a performance bond to sign a contract with a client.

Even when it's not required, contractors often choose to be bonded and insured to protect themselves and their clients and to show they are reliable.