Contractor Insurance Checklist: What Richland Builders Need Before Bidding a Job

A small contracting business in Washington needs L&I registration with a current surety bond, general liability insurance, an L&I workers' compensation account if it has employees, and tools and equipment coverage that a liability policy will not provide. Most general contractors will also require limits well above the state minimum, plus an additional insured endorsement naming them on your policy. If your certificate does not match what the contract asks for, you can lose the job after you've already won the bid. Crigler Insurance Agency in Richland, WA reviews these requirements with contractors before they sign, not after.

 

 

Start With What Washington Actually Requires

Before anything else, your L&I registration has to be active and your paperwork current. Washington registers construction contractors through the Department of Labor & Industries rather than licensing them by exam, which means your bond and your insurance are doing the work that a competency test does in other states.

 

As of the July 2024 update, the continuous surety bond requirement is $30,000 for general contractors and $15,000 for specialty contractors. If you're still working off the old $12,000 and $6,000 figures, those are out of date.

The state liability insurance minimum is $200,000 in public liability plus $50,000 property damage, or a $250,000 combined single limit. L&I has to be listed as the certificate holder on that policy.

 

One more compliance item that trips up newer outfits: your registration number has to appear on your advertising, business cards, bid proposals, estimates, and work vehicles. Building departments across Benton and Franklin counties check it on permit applications.

 

 

General Liability Is the Foundation, Not the Finish Line

Here's the part that costs contractors jobs. The state minimum is a licensing floor. It is not what a general contractor, a developer, or a commercial property owner will accept.

 

Most GCs in this market want to see $1 million per occurrence and $2 million general aggregate at minimum. Larger commercial work, public projects, and anything connected to the Hanford site frequently requires higher limits than that, sometimes backed by a commercial umbrella.

 

General Liability Insurance responds when your work causes bodily injury or property damage to someone else. A framing crew drops a bundle of lumber onto a homeowner's parked car. A plumber's fitting fails and water runs through a finished basement. A subcontractor's employee injures a passerby at a jobsite in Queensgate.

 

What general liability does not do is pay for the cost of redoing your own defective work. That's a separate conversation, and it's one worth having before you bid a job with tight margins.

 

 

Completed Operations: The Coverage That Matters After You Leave

This is the most overlooked line item on a contractor's policy, and it's the one that shows up years later.

 

Completed operations coverage, which sits inside your general liability policy under the products-completed operations aggregate, responds to claims arising from work you already finished. The deck you built in West Richland three summers ago fails and someone is hurt. The roof you installed leaks and damages drywall and flooring throughout a house.

 

Washington's construction statute of repose allows claims tied to a project to surface for years after substantial completion. That has two practical consequences.

 

First, a bare-bones policy with a low products-completed operations aggregate leaves you thin on exactly the claims most likely to hit a residential builder. Second, letting your general liability lapse between jobs is riskier than it looks, because coverage for past work generally depends on having a policy in force when the claim is made. Occurrence-based policies handle this differently than claims-made policies, and it's worth knowing which one you have.

 

 

Your Tools Are Not Covered by Your Liability Policy

Contractors are consistently surprised by this one. General liability covers damage you cause to other people's property. It does nothing for your own tools, equipment, or materials.

 

That's what contractors equipment coverage, sometimes called an inland marine policy or a tools and equipment floater, is for. It follows your property while it's in transit, sitting on a jobsite, or locked in a trailer overnight.

 

If you've financed a skid steer, a compact excavator, or a scissor lift, the lender almost certainly requires this coverage anyway. Even if you own everything outright, a trailer break-in overnight at a Horn Rapids jobsite can wipe out $15,000 in tools in twenty minutes.

 

Two details worth checking on your current policy. Ask whether your limit reflects replacement cost at today's prices rather than what you paid five years ago. And ask whether borrowed, rented, or leased equipment is included, because renting a trencher for a week without coverage in place is a common gap.

 

Materials are separate again. If you're installing product you purchased, an installation floater covers it between the supply house and the finished install.

 

 

What a General Contractor Will Ask For Before You Start

When you sub for a GC, the certificate of insurance is the gatekeeper. Expect them to require most of the following:

• General liability limits of at least $1 million per occurrence and $2 million aggregate
• An additional insured endorsement naming the GC and often the property owner
• Primary and non-contributory wording, meaning your policy pays first
• A waiver of subrogation in the GC's favor
• Proof of a current L&I workers' compensation account in good standing
• Commercial auto coverage on any vehicle used for the job

Read the insurance exhibit in the subcontract agreement before you sign it, not the week you're supposed to mobilize. Getting an endorsement issued takes time, and some requests require carrier approval rather than a same-day certificate.

 

On workers' compensation, remember that Washington runs a state fund. No private agency can write that policy here, so when a GC asks for proof, they're asking for evidence that your L&I account is current. We can help you get that documentation lined up alongside everything else.

 

 

Why This Matters in Richland and the Tri-Cities

Construction here has been busy for a while, and the mix of work creates uneven insurance requirements. Residential builds around Badger Mountain South and West Richland come with one set of expectations. Commercial tenant improvements in Kennewick and Pasco come with another. Public works and Hanford-adjacent subcontracts come with the most demanding requirements of all.

 

Contractors who bid across all three categories often carry a policy sized for the smallest of them and then scramble when a larger opportunity appears. That's the situation worth getting ahead of.

 

We've been working with Tri-Cities contractors out of the same Richland office since 2006, and contractors were the first commercial clients this agency served. We know what the GCs in this market actually ask for.

 

 

Questions Contractors Ask Us

 

Do I need general liability if I'm a one-person operation with no employees?

Yes, because Washington requires it as a condition of contractor registration regardless of headcount. Beyond compliance, most homeowners and every GC will ask for a certificate before letting you start.

 

Can I add a GC as an additional insured for just one project?

Usually yes. Carriers offer both blanket additional insured endorsements and project-specific ones, and which is better depends on how many GCs you work under. Call us before you agree to contract language, because some requested wording is not something every carrier will issue.

 

My tools were stolen out of my truck. Which policy covers that?

Contractors equipment coverage, not your general liability and generally not your commercial auto policy. The auto policy covers the truck itself and damage to it, while the equipment coverage responds to the tools inside.

 

 

Let's Look at Your Coverage Before the Next Bid

The worst time to find out your certificate doesn't meet a contract requirement is the week you're supposed to break ground. Give Crigler Insurance Agency a call and we'll pull your current policy, compare it against what GCs in this market are asking for, and tell you plainly where the gaps are. If limits need to come up, we'll price options across Travelers, Progressive, and Liberty Mutual so you can see the real cost before you commit.

 

You can read more about coverage for your trade on our Contractors Insurance page. When you're ready, call and ask for JJ, Michelle, or Donna, and bring the insurance exhibit from your next contract with you.

 

Call Us to Review Your Coverage