Marcus had run a small remodeling crew on the Eastside for nine years: kitchens, baths, the occasional basement. Most of his work came straight from homeowners, and his insurance had never been more complicated than a certificate for a nervous client.
Then a regional general contractor offered him the finish work on a twelve-unit townhome project in Bellevue. It was twice the size of anything he had done. The subcontract was forty pages long, and page thirty-one was all about insurance.
He sent it to us on a Thursday. The GC wanted the certificate by Monday.
What he asked for
A certificate of insurance showing the GC as an additional insured. Marcus assumed that was a form someone filled out. He had a general liability policy with $1 million per occurrence and $2 million aggregate, which matched the dollar figures in the contract.
What the review found
The limits matched. Almost nothing else did.
- Additional insured status needed an endorsement, not a certificate. His policy had no blanket additional insured endorsement, so listing the GC on a certificate would have been a statement the policy did not back up.
- The contract required completed operations coverage for the additional insured. Many additional insured endorsements cover only ongoing work. The GC wanted protection for claims that surface after the units are sold, which is when finish work claims usually appear.
- Primary and noncontributory wording. The contract required Marcus's policy to respond first, without the GC's own policy sharing the loss. That also takes specific policy language.
- A $2 million umbrella requirement. Buried in the same section: the GC required $2 million of excess liability over the general liability, auto, and employers liability policies. Marcus had no umbrella at all.
If he had signed and sent a certificate anyway, he would have been in breach of the subcontract on day one, and the indemnity he promised the GC would have come out of his own pocket.
What we put in place
We moved his general liability to a carrier whose contractor form includes blanket additional insured coverage for both ongoing and completed operations, primary and noncontributory wording, and a blanket waiver of subrogation. Blanket endorsements matter for a growing contractor: the next GC with the same requirements does not mean another scramble.
Then we added a commercial umbrella at $2 million, which is how the contract's excess requirement is usually met more cheaply than raising the primary limits.
The umbrella surfaced the third issue. Umbrellas require the underlying policies to be in order, and Marcus's two work trucks were insured on personal auto policies in his own name. Personal auto does not satisfy an umbrella's underlying requirements for business vehicles, and a personal carrier can dispute claims on a truck used daily for a business. We moved both trucks to a commercial auto policy, with hired and non-owned coverage for the crew member who sometimes runs to the supply house in his own car.
The certificate went out Monday morning, and this time every line on it was true.
Why it mattered
Finish carpentry and tile claims tend to arrive late: a leak behind a shower wall that shows up after the buyer moves in, a cabinet install that damages a finished floor. On a multi-unit project, one defect repeated across twelve units becomes one large claim. With completed operations coverage for both Marcus and the GC, a claim like that is defended under his policy instead of turning into a contract dispute between them.
The umbrella also changed what work he can bid. Most commercial GCs in the Puget Sound set excess requirements, and he now meets them without a rush call.
If you run a remodeling or trade business
- Send us the insurance section of any subcontract before you sign it, not after
- Ask whether your additional insured endorsement covers completed operations
- Put trucks titled to the business, or used daily for work, on a commercial auto policy
- Collect certificates from your own subs, because uninsured subs get charged back at audit
More on how we build programs for contractors and trades. If a contract is sitting on your desk right now, ask for a free policy review and we will read it against your policies.