Essential Guide: General Liability Insurance for Carpenters

Essential Guide: General Liability Insurance for Carpenters

Essential Guide: General Liability Insurance for Carpenters
By 
Samantha Hawrylack
Dec 15, 2021
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“Measure twice, cut once” is an old saying amongst carpenters. However, no one is perfect, and even the best carpenters make mistakes that can cause huge (and possibly unsustainable) financial losses. That’s why general liability insurance for carpenters is critical for your business.


Here is an overview of how general liability insurance works along with the cost and policy limits.

Who Needs General Liability Insurance? 

Ideally, every carpenter should have general liability insurance coverage to protect their business. 

Financial Protection 

The primary purpose of general liability insurance is to protect your business from financial losses. You can incur these losses from a range of common mistakes, including: 


  • Damages caused to the clients’ personal properties 
  • Bodily injuries sustained by employees, clients, and other parties 
  • Lawsuits filed by clients, competitors, and other third parties for allegations arising out of work performed, accidents, and even how services are advertised


These risks can result in unsustainable financial losses for your business. Fortunately, general liability insurance absorbs part or all of these losses.

Competitive Edge 

Insurance coverage is one of the main considerations for many people when hiring a contractor. As a result, getting insurance coverage can also boost your competitive advantage and help you make more money through client acquisition.

Legal Requirements 

Many federal entities, states, and cities mandate that contractors, such as carpenters, get insurance coverage. Therefore, failure to obtain coverage can result in legal consequences, such as fines and license suspension.

What General Liability Insurance for Carpenters Covers 

General liability insurance policies cover common risks for carpenters, such as property damage and bodily injury.

Property Damage 

Cases of property damage are common among contractors, including carpenters. The damages can be extensive and costly. The property owner may decide to sue, resulting in legal costs. General liability insurance may cover these typical fees.

Bodily Injury 

Worksite accidents happen. These accidents can result in life-changing bodily injuries, and victims often sue for compensation. The resulting legal and medical costs can amount to millions of dollars.  


General liability insurance may cover the bulk of these costs. However, you will need workers’ compensation insurance to cover bodily injury to employees.

Advertising & Personal Injury 

If you or one of your subcontractors or employees speaks poorly about a client or another vendor, it can result in expensive lawsuits. General liability insurance helps cover the legal and settlement costs.

Add-Ons 

Carpenters can also opt to add other items to their general liability insurance policies. Common add-ons include things like cyber protection, data breach coverage, and equipment coverage (ideal for helping cover the cost of repairing or replacing equipment).

What are the Carpenters Insurance’s Policy Limits?

Insurers will cover you up to a certain amount (insurance limit).


General liability insurance policies have varying limits. At Pathpoint, we regularly insure carpenter limits up to $1,000,000 per occurrence and $2,000,000 aggregate, but limits of $2,000,000 per occurrence and $3,000,000 aggregate as well as "per project" and "per location" limits up to $5,000,000 may be available by request. You can see other limits we have here.


Your goal is to get a limit high enough to cover your most expensive projects. However, it is also worth noting that extending your limits will raise your monthly premiums. 

How Much Does Carpenter Insurance Cost? 

General liability insurance for carpenters is worth every penny for peace of mind as a business owner. At Pathpoint, carpenters typically pay a premium of $650 or more per year. However, prices may vary depending on factors such as: 


  • Business’s location
  • Company’s overall size, including the total number of employees
  • Deductible (or the policy’s limits)
  • Maximum number of occurrences and claims
  • Overall value of your carpentry equipment


You can adjust some of your policy’s terms to change its overall cost. Raising your deductible or reducing your limit can result in cheaper monthly premiums.

When Do I Get the Certificate of Insurance? 

A certificate of insurance (COI) is an official statement confirming that your carpentry practice is covered by insurance. The one-page statement contains a summary of the insurance policy’s terms, including your business information, the type of coverage, and the policy’s expiration date. 


The main purpose of a COI is to serve as proof that you are insured. It also protects all parties involved in a project against potential risk, which is why clients and other vendors may ask to see it.


Experts recommend getting a certificate of insurance as soon as possible. Your insurance agent may issue it after receipt of payment. 

Get General Liability Insurance for Your Carpentry Business

General liability insurance is essential for carpenters. You can protect the future of your business from financial losses and legal issues. Contact your insurance agent and ask them to get you a Pathpoint quote.


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