Texas General Contractor General Liability Insurance Cost & Coverage

General liability (GL) insurance is the backbone of every Texas general contractor's risk program. Because a GC supervises work performed by many trades, the GL policy has to respond not only to your own crew's actions but to the cascading liability that flows up the contracting chain when a subcontractor causes damage or injury. Understanding what drives your GL cost helps you price bids accurately and avoid gaps that cost you the job.

What General Liability Covers for a GC

A commercial general liability policy covers third-party bodily injury, property damage, personal and advertising injury, and products/completed operations. For a general contractor, completed operations is the most important piece — a defect in a sub's work that causes damage years after handover is exactly the kind of claim GL is designed to respond to, provided the coverage is structured correctly.

Limits Texas Project Owners Expect

• Residential remodeling and small commercial: $1M per occurrence / $2M aggregate
• Mid-size commercial and multi-family: $2M per occurrence / $2M aggregate
• Public works and large commercial: $2M per occurrence / $4M aggregate
• Often layered with a $5M–$10M umbrella/excess policy

How Class Codes and Payroll Drive Premium

GL for GCs is typically rated on payroll and subcontractor cost, not revenue. Carriers assign a class code to your own direct employees (often a carpentry or construction-supervision code) and a separate code for uninsured subcontractors. If you use 1099 subs who carry their own GL and name you as additional insured, those costs may be excluded from your premium base — which is why collecting sub COIs is a direct premium savings, not just paperwork.

Subcontractor Exposure and the Contract

Texas courts apply a sophisticated-appliance test to determine when a GC is liable for a sub's work. Your contract language, indemnification provisions, and the additional-insured status you carry from each sub determine who pays first. A GL policy with a subcontracted-work exclusion or a tight subcontractor warranty can leave you uninsured precisely when a sub's policy is exhausted.

Typical Cost Ranges in Texas

A small residential GC with one superintendent and subcontracted trades often pays $1,200–$2,500 annually for a $1M/$2M policy. A mid-size commercial GC running $2M–$5M in payroll and subcontractor cost typically pays $3,500–$8,000, plus an umbrella. New-construction-heavy GCs and high-rise work carry surcharges. Run the Risk Engine with your actual payroll and sub costs for an accurate estimate.