The short answer
Before a subcontractor starts work, compare what your contract requires of them with what their insurance actually provides. A certificate confirms that a policy exists, not all its terms and conditions. Check the activity, the works, the period and the limits, and monitor changes until the project is complete.
Start with the scope of work
Describe what the subcontractor does, on which structures, with what entrusted property and over what period. The contract sets out their responsibilities towards you; this is the basis for determining what insurance to request. The 2020 guide from the Coordination Conference for Public Sector Construction and Property Services (KBOB) clearly distinguishes contractual liability from what insurance actually covers, and recommends analysing each project.
Read beyond the certificate
- Insured activity matching the work assigned
- Type of structure and location covered
- Period of validity covering the entire engagement
- Limits and excesses assessed against the exposure
- Treatment of property entrusted to the subcontractor or being worked on
- Exclusions relevant to the scope of work
Their faults, your risks
The subcontractor's policy generally responds to their own faults towards third parties. Your general contractor's policy does not automatically cover every subcontractor or every instance of defective work. Clarify who insures what, particularly rectification of their own work, which is often treated separately.
Monitor through to completion
Construction projects evolve: extensions, new work packages, changes of team. Record certificate expiry dates and request confirmation again if the work period is extended. Keep the subcontractor's insurer's contact details up to date so that damage can be reported promptly.
In practice, one record per subcontractor is enough: scope of work, certificate received, expiry date, limits noted, outstanding questions and person responsible for follow-up. This simple record prevents an expired certificate from going unnoticed during a busy construction project, and makes notification easier if damage occurs.
Frequently asked questions
Is an insurance certificate enough?
It proves that a policy exists on a given date. Where the exposure is significant, also request the key terms: activity, limits, period and relevant exclusions.
Does my business liability insurance cover damage caused by my subcontractor?
That depends on your policy and the contract. Do not assume it does: ask your insurer, providing a description of the scope of work.
Is the KBOB guide a mandatory rule?
It is a 2020 guide for professional services contracts and works contracts. It helps structure the analysis; it replaces neither the law nor your contract.