If you work in construction, electrical, HVAC, or any skilled trade, you already know safety is serious business. But one of the biggest risks many contractors overlook isn’t on the job site — it’s in their insurance coverage.
Whether you’re a general contractor, a subcontractor, or an independent tradesperson, understanding how Workers’ Compensation Insurance applies to you can protect your business from lawsuits, lost contracts, and big financial surprises.
Why Contractors Need Workers’ Comp
Workers’ Compensation Insurance covers work-related injuries and illnesses. It pays for:
- Medical treatment and rehabilitation
- Lost wages during recovery
- Death benefits to families (if the worst happens)
Even if you’re self-employed or only hire temporary help, you may still be required by law or contract to carry coverage.
Without it, you could be personally responsible for injury claims — and may even lose the right to work with certain general contractors or government projects.
Subcontractors: Why You Might Still Need Coverage
Many subcontractors assume they’re covered under the general contractor’s policy.
However, most general contractors require each subcontractor to carry their own Workers’ Comp policy before setting foot on the job site.
If you don’t have one:
- The general contractor may withhold payment until you provide proof.
- You could be classified as an employee under their policy (raising their costs).
- You risk being excluded from future bids or projects.
💡 Tip: Always have a valid Certificate of Insurance (COI) before starting any contracted work.
What If You’re a One-Person Operation?
If you’re an independent contractor or owner-operator with no employees, you may not need full Workers’ Comp — but you’ll likely need proof of coverage for compliance.
That’s where a Ghost Policy comes in.
A Ghost Workers’ Comp Policy:
- Costs less than a traditional policy
- Covers zero employees (you only)
- Provides a valid COI for job site or contract requirements
💡 Even though it doesn’t cover injuries to you, it satisfies legal and contractual requirements — keeping you eligible for work.
General Contractors: Protecting Your Business
If you’re a general contractor, you can be held liable for injuries to uninsured subcontractors working under you.
That’s why it’s critical to:
- Collect Certificates of Insurance from every subcontractor.
- Verify coverage dates and names match the business.
- Require Workers’ Comp coverage in every subcontractor agreement.
This protects your business from lawsuits and audit penalties later.
How Premiums Are Affected
When subcontractors don’t carry their own Workers’ Comp, the state or your insurance company may treat their pay as your payroll — raising your premium.
For large projects, this can mean thousands of dollars in unexpected costs.
💡 Tip: Keep all COIs on file. It’s your best defense during a Workers’ Comp audit.
Stay Compliant and Competitive
At Upstate’s Choice Insurance, we help contractors and subcontractors across South Carolina, North Carolina, and Georgia find affordable Workers’ Comp solutions — including Ghost Policies, Owner Coverage, and Full Employee Plans.
We understand the construction industry and can help you:
- Stay compliant with general contractor requirements
- Avoid audit penalties
- Get certificates fast — often same day
- Save money with multi-policy discounts
👷♂️ Protect your crew, your contracts, and your company — get your Workers’ Comp quote today!
📍 www.upstateschoice.com