What to do when a subcontractor has no insurance

Why it matters

If a sub has no insurance and somebody gets hurt, the claim comes looking for money. The sub often can’t pay. That leaves you and your policy. In some states, like Florida and Georgia, the law can make a contractor responsible for the workers’ comp of an uninsured sub’s employees. See our Florida and Georgia guides.

Your options

Not legal or insurance advice. This is general information. Your contract, your state and your policy decide what applies to you. Ask your broker or attorney.

What to ask before they start

1. Do you have general liability? Send me the certificate.
2. Do you have workers’ comp for your crew? Send proof.
3. Who’s your agent? I’m going to call them.
4. If you say you have no employees, in writing, tell me who works on this job.

Watch for fake 1099s

Some subs say “my guys are all 1099, they cover themselves.” Whether a worker is really independent depends on how the job is run, not on the form. Many states look past the label. If workers are really employees, they may need workers’ comp coverage. Ask your attorney before you accept that answer.

Get it on paper

Whatever you decide, write it down. Dates, names, what the sub said. A tracked, written record is what you’ll want if there’s ever a claim. We keep that record for you.

Signs a sub may not be insured

• They keep promising to send the certificate, but never do.
• The price is far below every other bid.
• They will not give you their agent’s name or number.
• The certificate shows a policy that started after the job did.
• They say they do not need workers’ comp because “everyone is a subcontractor.” Rules for who needs coverage vary by state, so ask for proof or exemption papers.

What to say to the sub

We cannot have you on site without proof of insurance. This is our rule for every sub. If you can send a current certificate and the endorsements by [date], we can keep your start date. If not, we will need to move to the next bid.

Keep it friendly and the same for everyone. It is a rule about the paperwork, not about the person.

Common mistakes

1. Letting it slide “just this once.” This is how the one big claim happens.
2. Taking the sub’s word. Ask for the paper and call the agent.
3. Not checking workers’ comp. General liability alone does not cover a hurt worker.
4. Forgetting the sub’s own subs. Your contract should require them to carry insurance too.

Your options, in the order to try them

1. Do not let them start. This is the cheapest fix. No certificate, no site access.
2. Ask them to buy a policy first. Many agents can set up general liability quickly for a small contractor. Give a short deadline and say you will accept a new certificate and the endorsement when it arrives.
3. Use a different sub. If the price was low because they skip insurance, the savings are not real.
4. Bring them on under your own coverage only if your broker says yes. Some programs allow it, but it can raise your cost. Ask before you promise anything.

What an uninsured sub can cost you

Keep a paper trail

If a sub worked without insurance for any reason, write down what happened: who approved it, the dates, and what you did to fix it. Save the emails. If there is a claim later, this record shows you tried to follow your own rules. Then fix your process so the same gap cannot repeat. A weekly list of who is missing a certificate takes minutes. Our free audit builds that list from your sub names.