A Contractor’s Practical Guide to Common Insurance Clauses Before Starting a Project

Before Pennsylvania contractors begin a project, it’s important to understand the insurance clauses that appear in customer, vendor, or subcontractor agreements. This quick summary highlights the ones you’ll see most often: additional insured requirements, waivers of subrogation, certificates of insurance, and contract review. Knowing what each clause means—and how it affects your coverage—helps you avoid surprises once work begins.

At Ashmead Insurance Associates, an independent insurance broker that helps Pennsylvania contractors navigate insurance requirements every day, we review these clauses frequently. Whether you’re a general contractor, tradesperson, subcontractor, or specialty contractor, understanding the language in your contracts can keep you compliant and protected.

Why Insurance Clauses Matter Before You Start Work

Contracts often outline the insurance obligations you must meet before stepping onto a jobsite. These requirements can affect your general liability, workers compensation, commercial auto, umbrella, and even your tools and equipment coverage. If you sign without fully understanding a clause, you may unintentionally agree to coverage you don’t carry—or worse, expose yourself to uninsured risk.

That’s why many contractors rely on Ashmead Insurance Associates for upfront contract review. We help you interpret the language, explain what’s required, and confirm whether your policy already meets the contract terms or if changes are necessary.

Additional Insured Requirements

One of the most common clauses you’ll see is a requirement to list another party—usually a project owner, GC, or property manager—as an “additional insured” on your policy. This means your policy will help protect them if a claim arises out of your work.

Plain-language explanation: If someone sues the project owner or general contractor because of something related to your work, your policy may respond for them, not just for you.

Common situations where this appears:

• General contractors requiring subcontractors to add them as additional insureds
• Commercial or residential property owners hiring contractors
• Municipal or institutional projects

What to ask before signing:

• Does my policy already include blanket additional insured wording?
• Does the contract require ongoing operations, completed operations, or both?
• Does the wording match ISO-standard endorsements or require something more restrictive?

Some contracts request very specific, non-standard endorsements. Ashmead Insurance Associates helps contractors compare contract language to their policy wording to confirm compliance and avoid unnecessary changes.

Waivers of Subrogation

A waiver of subrogation prevents your insurance carrier from seeking reimbursement from another party—even if that party contributed to the loss. Many project owners and GCs include this clause to protect themselves from future disputes.

Plain-language explanation: If something goes wrong, your insurance company agrees not to try to recover its costs from the other party named in the contract.

Where this shows up:

• Workers compensation contracts
• General liability agreements
• Commercial auto agreements for jobs requiring vehicle use

What to ask before signing:

• Does my policy allow waivers of subrogation?
• Is the waiver required on all policies or only certain lines?
• Is it blanket or job-specific?

Because waivers shift risk, they can sometimes lead to higher premiums or require carrier approval, making it essential to review them with your insurance broker early.

Certificates of Insurance (COIs)

Almost every contractor must provide a certificate of insurance before starting work. A COI proves you have the coverage required by the contract and lists any endorsements such as additional insured status or waivers of subrogation.

Plain-language explanation: A COI is your proof of coverage—a snapshot showing your insurance meets the customer’s requirements.

Typical requests include:

• General liability limits
• Workers compensation verification
• Auto liability limits
• Umbrella policy limits
• Proof of endorsements (when required)

To submit a certificate request quickly, Pennsylvania contractors can use our online tool: Request a Certificate.

What to ask before signing a contract:

• Does the contract require special wording on the certificate?
• Does the certificate holder want to be listed as additional insured or just notified?
• Does the contract require advance notice of cancellation?

Some certificate requests ask for language that insurers won’t allow—another reason to review contract requirements before signing.

Primary & Non-Contributory Language

This clause typically appears alongside additional insured requirements. It states that your policy will respond first—without sharing costs with the other party’s insurance—if a claim arises from your work.

Plain-language explanation: If a claim happens, your policy pays before the GC’s or owner’s policy does.

Where you’ll see it: Commercial construction projects, municipal projects, and contracts involving multiple subcontractors.

What to ask: Does my policy include primary and non-contributory wording automatically, or do we need to add an endorsement?

Hold Harmless & Indemnification Clauses

These clauses shift responsibility from one party to another. Many contracts require the contractor to “hold harmless” the project owner or GC for certain types of claims.

Plain-language explanation: You may be agreeing to take responsibility for legal and financial consequences—even ones you didn’t fully cause.

Before signing: Always read these clauses carefully. Some are one-sided or overly broad. While your insurance broker cannot give legal advice, we can help you understand whether your policy will respond to the obligations you’re being asked to accept.

Endorsements That Contractors Commonly Need

Endorsements modify your policy to meet contract requirements. Common contractor endorsements include:

• Additional insured for ongoing operations (CG 20 10)
• Additional insured for completed operations (CG 20 37)
• Waiver of subrogation endorsements
• Primary and non-contributory endorsements
• Per-project aggregate limits
• Owners and contractors protective liability (OCP) policies

An independent broker like Ashmead Insurance Associates can help determine whether these endorsements are already included in your policy or need to be added for the project.

When Contractors Should Ask Questions

If you see any clause that seems unfamiliar, overly demanding, or inconsistent with your policy, pause before signing. Some requirements—like limits higher than your policy offers—may require adjustments or carrier approval. Others may be unreasonable or non-standard.

You should always ask questions when:

• A contract requests endorsements you’ve never heard of
• A GC or project owner demands unusually high limits
• Requirements differ from previous years or previous projects
• The contract includes indemnification or risk transfer language that seems broad or unclear
• You’re unsure whether your current policy meets all terms

Contract review before signing can prevent future claims disputes, audit issues, or compliance problems that delay payment.

How Ashmead Insurance Associates Helps Contractors Stay Compliant

As an independent insurance broker serving contractors across Pennsylvania, Ashmead Insurance Associates helps review project requirements, explain contract language, confirm whether your coverage meets the terms, and provide certificates promptly. When contractors need guidance, we compare multiple carriers and policies to identify solutions that meet both practical and contractual needs.

To learn more about protecting your business, explore our Contractor Insurance page.

If you’re preparing for a new job and want help reviewing your insurance requirements, we’re here to make sure everything is aligned before work begins. Contact us to review your contract’s insurance clauses and ensure you’re protected from day one.