6-minute read
Congratulations! You’ve landed the job. The blueprints are solid, the crew is ready, and you’ve already started imagining that sweet, sweet progress draw.
Then the contract shows up.
And somewhere between the indemnification clause and the exhibit marked “G-4,” you see it: a list of insurance requirements that reads less like a construction agreement and more like a policy wish list from someone who just Googled “weird insurance terms to confuse contractors.”
Let’s decode what’s going on — and how to protect yourself without tanking the deal.
1. When ‘Standard Coverage’ Isn’t Actually Standard
More and more general contractors are slipping in requirements for coverage types that weren’t even on your radar a few years ago. Think:
- Cyber Liability
- Professional Liability
- Employment Practices Liability
- Pollution Legal Liability
- Higher Excess or Umbrella limits
And they’re not just asking for them — they’re asking for millions in limits, blanket additional insured endorsements, primary and non-contributory wording, and waivers of subrogation across every policy line.
Some of it is fair. Some of it is just risk transfer dressed up in legalese.
2. ‘Why Do I Need This?’ — A Fair Question
You’re not crazy to wonder why your drywall subcontracting company suddenly needs $1 million in cyber coverage. Or why your excavating outfit is being told to carry professional liability.
A lot of this stems from lawyers and risk managers looking to offload every possible liability — even the ones that have nothing to do with the work you’re doing.
And let’s be honest: sometimes the GC’s insurance requirement template hasn’t been updated in a decade. Or worse, it was borrowed from another project that had totally different exposures.
This is where pushing back is not just OK — it’s smart.
3. Yes, You Can Push Back (But Do It Strategically)
Here’s the thing: You don’t want to come across as the difficult subcontractor who nitpicks every clause. But you also don’t want to silently sign away your profits trying to meet unnecessary or duplicative insurance requirements.
A few tips for negotiating smarter:
- Ask for context. “Can you help me understand why cyber is required for this scope of work?” puts the onus back on them — without sounding adversarial.
- Use your broker. (That’s us.) We do this every day. We’ll review the contract, flag anything off-base, and even provide sample language to help you negotiate.
- Be solution-oriented. Don’t just say “no.” Offer alternatives — like a lower limit, a carve-out, or a project-specific endorsement — to keep the deal moving.
4. The Real Cost of ‘Just Signing It’
Maybe you’ve shrugged off insurance requirements before. Maybe you’ve had your agent “make it work” with a last-minute binder.
But here’s the risk: accepting unreasonable terms can trigger premium increases, uncovered losses, and even contract breaches if your policy doesn’t actually comply with what you signed.
Worse, you may find yourself chasing unicorn endorsements your carrier doesn’t offer — or paying triple to a specialty market that does.
It’s like agreeing to wear a tuxedo to a framing job: you might pull it off, but you’ll sweat, you’ll overpay, and someone’s still going to call you ridiculous.
5. What to Do Before You Sign
- Get your contract reviewed early. Before you fall in love with the project, loop in your insurance team. That includes your agent, your attorney if needed, and your in-house team if you’ve got one.
- Get clarification in writing. If the GC says, “Don’t worry about that part,” don’t pop the champagne just yet. Get a waiver, amendment, or written confirmation — or it doesn’t count.
Know your limits — literally. Keep a cheat sheet of your coverage limits, exclusions, and endorsements so you can quickly cross-check them against contract asks.
6. Our Role in All This? We’re the Translator (and Sometimes the Bouncer)
At The Mahoney Group, we live for this stuff. We’ll review your contracts, call out anything that seems unreasonable or mismatched to your work, and help you have the right conversations — without losing your mind or the job.
Sometimes we recommend alternatives. Sometimes we call the GC’s broker and work out a solution directly. And yes, sometimes we help you walk away from a job that’s just too loaded with risk.
Bottom line: We’ve got your back — and we speak fluent insurance-legalese-contractor-ish.
Final Thought: Read the Fine Print (Or Let Us Do It)
In construction, the devil isn’t just in the details — he’s often in the exhibits and appendices. Before you roll the dice on your next contract, slow down, take a look, and ask the questions most people don’t.
Because protecting your business is part of the job — and unlike Exhibit G-4, that actually makes sense.
The Mahoney Group, based in Mesa, Ariz., is one of the largest independent insurance and employee benefits brokerages in the U.S. For more information, visit our website or call 877-440-3304.
This article is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.