When you hire a subcontractor
When you hire a subcontractor there are several things you should make sure you have a place:
Subcontractor Agreement –
This is the written contract between you and your sub. It clearly spells out what work they’re doing, how they’ll be paid, and who is responsible if something goes wrong. Additionally, it requires that you are “additionally insured” by your sub for the same limits you carry on your GL.
Why it matters: It keeps everyone on the same page and proves there’s a legal relationship in place — not just a handshake deal. This is a critical best practice where there is a misunderstanding regarding work that could lead to a claim.
Certificate of Insurance with You Listed as “Additional Insured” –
This confirms that your subcontractor is properly insured and that their policy also protects you if they cause damage or injury on your job.
Why it matters: If their work causes a claim, their insurance pays first—not yours. That helps protect your loss history.
Hold Harmless Language (Indemnification) Agreement –
This is a clause in the subcontract that says the subcontractor will take responsibility (legally and financially) for their own actions/work, not you.
Why it matters: It helps prevent you from being dragged into lawsuits or claims caused by their mistakes.