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I hired someone from a third-party site, and because I work in insurance, one question sat in my head the whole time: is he insured? I finally asked. He wasn't. That's the case for contractor insurance in one story: your next client is quietly asking the same question about you.
Clients check now
Clients used to take your word for it. Now they verify. In April 2025, a town clerk in Derby, Vermont was reviewing a town-garage renovation contract when something about the contractor's certificate of insurance (a COI, the one-page proof that a policy exists) looked off. She called the insurance company. Coverage had stopped in 2019.
That clerk isn't unusual anymore. Hiring platforms now screen the pros they list, with background checks and license verification behind a profile badge, and their own help pages tell homeowners to ask for proof of insurance before booking. To the person choosing, an insured contractor and an uninsured one don't look the same. Homeowners don't just Google how to hire someone now; they ask AI what to check first, and proof of insurance sits near the top of that checklist. Most of the screening happens before you ever get a call. Being able to answer "yes — want the certificate?" wins work. "I'm working on it" is a reason to keep scrolling.
What a one-person contractor actually carries
There's no single policy called contractor insurance. For a one-person trade it's a short stack, and I'd build it in the order accidents actually happen.
General liability insurance (GL) comes first. It covers your legal responsibility when someone else gets hurt or their property gets damaged because of your work or your job site, including the legal defense, up to your policy limits. It does not cover your own injuries or your own gear. When a client asks about contractor liability insurance, this policy is what they mean. The trades are risky work: construction had 1,075 worker deaths in 2023, roughly one in five of all U.S. workplace deaths, and falls, slips, and trips caused about 39% of them. If you work 1099 on other people's jobs, our guide to general liability insurance for 1099 contractors goes deeper.
Your tools come second. A homeowner's or renters policy mostly won't cover business gear, so tool and equipment coverage is its own piece (insurers file it as inland marine insurance, an old shipping term for business property that travels with you). It covers theft and damage wherever the job is. One national count of heavy-equipment theft logged 11,625 thefts in a single year, and only about 23% of the stolen equipment was ever recovered. A trailer of tools that disappears overnight usually stays gone.
Commercial auto comes next if your truck does the work. A personal auto policy might not pay for an accident while you're hauling materials or driving between job sites, because it wasn't priced for that use. If the truck is part of the business, commercial auto insurance is the version for that.
Last, workers' compensation insurance, which pays for employees' work injuries. Do you need it with no employees? Often not. But some states write insurance requirements for contractors straight into license law: California already requires workers' comp for certain license classifications (concrete, HVAC, roofing, and tree service among them) even with zero employees, and it's extending that requirement to every classification. Check your state's license rules before you assume you're exempt.
The paperwork that wins the job
Getting covered is half of it; proving it is the other half. The COI is what a client actually requests: the one-page certificate showing who insures you, for what, and through when. It's free once you have a policy and usually quick to get (here's how that works), and our COI guide walks through what's on the page. An additional insured endorsement goes a step further. It adds your client's name to your policy, so your coverage also protects them if your work causes a claim.
You'll see both in writing when the client is a business or a government. San Diego, for example, requires contractors working for the city to carry general liability, workers' comp, and auto liability at $1,000,000 each, with a COI and an additional-insured endorsement naming the city before work begins. Those requirements don't stop at the general contractor (the GC). A GC's policy doesn't cover a subcontractor's mistakes, so GCs push the same COI and additional-insured asks into their subcontracts. If a contract names a limit, that number is your minimum, and our post on how much liability insurance you need covers reading those clauses.
"I just started, can it wait?"
The man I hired said the same thing: he was just getting going and watching every dollar. Honestly, I understood. But here's the math on independent contractor insurance for one person: GL commonly runs around $45 a month. Call it a dollar-fifty a day, against a latte habit that costs three or four times that. And the real price of waiting isn't the premium you saved. It's the jobs that go to the pro with the badge and the certificate, and you never hear about those. If you've already had to say no when a client asked, you know how the rest of that conversation goes.
His story ended well. He found an online platform that could issue a policy with a COI (this was before Olli existed), and he was covered the next day. One evening between "no" and "yes, want the certificate?"
You're building something real. Protect it.
Olli was built for exactly this: we match one-person businesses with the coverage their clients actually ask about, COI included. Answer a few questions at olli.insure/quote and see what fits your trade. The next time someone asks if you're insured, you'll have the certificate ready.
Our editorial content is intended for informational purposes only and is not written by a licensed insurance agent. Terms and conditions for rate and coverage may vary by state, class of business or the individual.
Sources
- Census of Fatal Occupational Injuries, U.S. Bureau of Labor Statistics
- Contractor alleged to have falsified a certificate of insurance, Newport Vermont Daily Express
- Workers' compensation insurance requirements, California Contractors State License Board
- Commercial general liability insurance, Insurance Information Institute
- Insurance and bond requirements for vendors, City of San Diego
- Heavy-equipment theft report, National Insurance Crime Bureau