Excavation Contractor Insurance: Earthwork & Grading
Get tailored and hassle-free excavation insurance with ContractorNerd
CONTRACTOR-SPECIALIST INSURANCE PROVIDERS
We cover what matters on the job.
Most insurance agents have no clue what excavation contractors actually deal with. We do. Excavation insurance is what we do, so we know the hazards underground, the equipment on site, and what’s really at stake when you break ground.
General Liability
Covers you when a utility gets clipped, a foundation shifts, or something goes wrong in the dirt.
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Worker’s Compensation
Excavation work is dangerous. When someone on your crew gets hurt, you’re not left covering the cost.
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Surety Bonds
Provides protection to the project owner that you’ll finish the job and pay your subcontractors.
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Commercial Auto
Protects your dump trucks and equipment haulers so you can focus on the dig, not the liability.
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Builders Risk
Covers your project from materials to completion – because construction comes with enough risks already.
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Excavation Insurance, Remodeled
Excavation insurance is essential, yet many contractors struggle to find coverage that actually fits their operations. No more. At ContractorNerd, we’ve built a proprietary quote platform specifically designed for excavation contractors like you.
Faster, Simpler, Better
As trades-only specialists focused on excavation, we’ve completely remodeled the insurance experience to be faster, simpler, and more effective.
Compare in one place
Our technology integrates directly with excavation-friendly insurers who understand the unique risks of digging, trenching, and site work, while our team of tech-enabled and specialized agents provides expert guidance throughout the process.
Solutions for Any Size
Whether you’re running a single excavator or managing multiple crews, our platform delivers precisely what you need without the complexity or delays of traditional insurance.
What Is Excavation Insurance?
ContractorNerd has done research to bring you a clear picture of insurance requirements and needs across the United States. Our analysis of hundreds of excavation insurance quotes across all 50 states provides unprecedented transparency on what coverage you need and current market rates.
Key Takeaways
What Excavation Insurance Do You Need?
For excavation contractors, securing the right coverage is crucial and needs change based on the size and stage of your business. Here’s a guideline:
For Solo Excavators
1-3 Employees
For Small 
Excavation Businesses
5+ Employees
For Established Excavation Businesses
Essential Coverage
Excavation Liability Insurance (General Liability)
Your core protection against property damage and bodily injury claims. This is what customers mean when they ask if you’re insured.
Ongoing Operations
Covers damage while you’re working on-site
Completed Operations
Critical protection for issues discovered after you leave, like settling soil causing foundation cracks
Contractor License Bonds
Required in most states for your contractor license. Pro tip: Buy in 3-year increments when possible to avoid lapses and save money (typically costs a few hundred dollars).
Recommended Additional Coverage
Tools and Equipment Coverage (Inland Marine)
Protects your excavators, bulldozers, trenchers, and attachments
Contractor’s Errors & Omissions
Covers claims of faulty workmanship, materials, or products
Commercial Auto
Required if you have dump trucks or equipment haulers
Workers Compensation
Required when you hire employees (not needed for subcontractors)
Installation Floater
Protects expensive materials in transit or stored at job sites (drainage pipe, culverts, fill material)
Commercial Property
Covers your equipment yard, storage areas, and offices
Umbrella Insurance
Extra liability protection as your revenue and project volume grow
Employment Practices Liability (EPLI)
Protection against employee-related lawsuits
For Solo Excavators
Essential Coverage
Recommended Additional Coverage
For Small Excavation Businesses
2-3 Employees
All previous coverages, plus:
For Established Excavation Businesses
All previous coverages, plus:
Excavation General Liability Insurance Coverage
If there was a single coverage critical for all excavation contractors, this is it. General Liability Insurance provides essential protection for excavation contractors because your work involves many risks every day – trenching near utilities, working around unstable soil, operating heavy equipment near structures, and more.
Core protection includes
Bodily Injury
A client, visitor, or bystander getting hurt due to excavation hazards or work activities.
Property
Damage
Accidental damage to a client’s property, underground utilities, foundations, landscaping, etc.
Add-On
Completed
Work
Lawsuits over excavation issues from past completed jobs, such as improper backfill or drainage failures.
Bodily Injury
A client, visitor, or bystander getting hurt due to excavation hazards or work activities.
Property
DamageAccidental damage to a client’s property, underground utilities, foundations, landscaping, etc.
Add-On
Completed
WorkLawsuits over excavation issues from past completed jobs, such as improper backfill or drainage failures.
Liability Limits for Excavation Contractors
Typically, $1 million per occurrence and $2 million aggregate. Experts recommend a minimum of $1 million for adequate protection. Upgrading from $500k to $1M coverage usually slightly increases premiums but provides significantly better defense.
Classification Codes
Excavation contractors typically use class code 94007, though operations may vary based on depth and scope of work.
Key Factors Influencing Liability Quotes
Revenue

Higher revenue implies more work and higher risk, leading to increased quotes.
Policy Limits

Higher limits for specific projects or contracts may raise quotes.
Claims History

A history of frequent claims can result in higher quotes, similar to auto insurance.
Location

States with stricter regulations may have higher insurance quotes.
Services Offered

Different excavation services have varying risks, affecting the insurance quote.
How Much Does Excavation Insurance Cost?
Quote Study Findings
Quotes generally amount to 1.1% to 10.4% of annual revenue. Our analysis of hundreds of General Liability insurance quotes from leading carriers reveals significant variations across different states and business sizes.
We analyzed quotes based on these business profiles
Revenue
$150K
1 owner-operator with ~10% subcontracting and 5+ years operating without claims
Revenue
$500K
1 owner and 3 employees with ~10% subcontracting and 5+ years operating without claims
Revenue
$1M
1 owner and 5 employees with ~10% subcontracting and 5+ years operating without claims
We analyzed quotes based on these business profiles
Revenue Level
National Average
Favorable Rate
Potential Savings
Low % of Revenue
High % of Revenue
$150,000
$6,230
$4,190
33%
2.1%
5.2%
$500,000
$17,020
$10,320
39%
1.5%
4.7%
$1,000,000
$32,000
$20,500
36%
1.5%
4.2%
State-by-State Pricing Insights
To help excavation contractors better understand regional pricing variations, we’ve developed an in-depth resource examining excavation insurance premiums in every state nationwide. This state-specific analysis reveals how local factors impact your actual costs and identifies opportunities for savings in your market – explore our comprehensive guide to excavation insurance cost by state for detailed premium breakdowns.
Excavation Workers Comp Insurance Requirements
Workers’ Compensation Insurance is essential for excavation contractors, providing coverage for employee injuries or illnesses related to work. The premiums are based on job risk, classified by the National Council on Compensation Insurance (NCCI) into class codes. Excavation contractors typically fall under code 6217, with rates usually between $3.00 to $8.00 per $100 of employee payroll annually.
WC Policy Limits for Excavation
These are often unlimited but can vary according to state regulations.
WC Rates for Excavation
Between $3.00 and $8.00 per $100 of payroll.
Key Factors Influencing WC Premiums for Excavation Contractors
Class Codes

Group employees by job type and risk; higher risk means higher premiums. Excavation contractors commonly use code 6217.
State Regulations

States dictate workers’ compensation laws, influencing benefits and baseline rates. Geographic differences in living and healthcare costs also affect premiums.
Experience modifier

Reflects your safety record, starting at 1.0 and adjusting based on claims history. More incidents result in higher modifiers and premiums.
Payroll Size

Calculated as (payroll / $100) * rate * experience modifier, with larger payrolls leading to higher premiums
This insurance is typically mandatory if you have employees. It covers employee medical expenses, rehabilitation, lost wages, and even death benefits in case of job-related injuries or illnesses. For employers, it also provides legal coverage and compensation in case of employee lawsuits related to occupational injuries or illnesses.
Insurance For Excavation Business That Expands Into Other Trades
If you’re an excavation contractor who’s branched out into concrete work, demolition, or utility installation, your standard excavation contractor insurance isn’t going to cut it. The work is different, the risks are different, and your coverage needs to reflect that.
Doing concrete or foundation work? You need coverage that goes beyond digging holes. Structural failures, improper grading, and finishing defects require concrete contractor insurance, not just excavation liability.
Taking on demolition projects? Tearing down structures is just part of the job. Debris removal, asbestos exposure, and structural collapse risks need demolition contractor coverage. Your excavation policy won’t protect you when someone claims you damaged an adjacent building.
Installing utilities or septic systems? Make sure your policy covers the full scope of work. Underground utility strikes, improper installations, and environmental contamination require coverage that extends beyond just digging the trench. Consider septic system contractor insurance if you’re handling those jobs.
The bottom line: If you’re doing the work, you need the insurance. Don’t assume your excavation contractor policy covers these expanded services. A single uncovered claim from demolition, concrete, or utility work can wipe out years of profit.
Talk to your insurance provider about adding trade-specific coverage, or you’re gambling every time you take on one of these jobs.
Insurance For Excavation Business That Expands Into Other Trades
Additional Excavation Insurance Coverage Options
As your excavation contracting business expands, these additional coverage types merit careful consideration beyond your core insurance portfolio:
Tools & Equipment Coverage
(Inland Marine Policy)
Specially designed to protect your excavators, bulldozers, trenchers, and specialized attachments whether stored in your equipment yard or deployed at job sites. This coverage addresses theft, accidental damage, or mysterious disappearance.
Professional Liability Insurance
Safeguards your business when clients allege professional mistakes or oversights in your excavation services. Whether it’s claims of improper grading, drainage failures, or utility locating errors, this coverage handles defense costs and damages. Protection includes negligent workmanship allegations, attorney fees, and court awards.
Commercial Auto Coverage
Essential protection for your fleet of dump trucks, equipment haulers, and service vehicles used in daily operations. Standard personal auto coverage excludes commercial excavation work, leaving dangerous gaps.
Excavation License Bonds
These financial guarantees demonstrate your commitment to quality workmanship while satisfying state licensing boards. Bond requirements commonly range $5,000-$25,000, with annual premiums representing 1-3% of the bond amount. Your credit profile significantly influences pricing:
Quote Summary by Revenue Level
Bond Required
Top-Tier Credit
Standard Credit
Challenged Credit
$5,000
$100-$150
$150-$200
$200-$400
$10,000
$100-$300
$300-$500
$500-$1,000
$15,000
$150-$400
$400-$750
$750-$1,500
$20,000
$180-$500
$500-$1,000
$1,000-$2,000
$25,000
$200-$500
$500-$1,200
$1,200-$2,500
Regulations vary dramatically – California excavation contractors need $15,000 bonds while Texas imposes no blanket requirement.
Commercial Property and Business Personal Property
Comprehensive coverage securing your equipment yard and materials (pipe, culverts, fill material, fuel tanks) from perils including fire, criminal activity, storm damage, and malicious mischief. Vital for operations maintaining storage yards, maintenance shops, or fuel depots.
Excavation Contractor Business Package
Intelligently combines liability and property coverages into a streamlined policy. Perfect for established excavation operations with brick-and-mortar locations, addressing customer accidents, property destruction, equipment loss, and revenue interruptions. Often delivers cost savings versus standalone policies, though customization options become limited.
Excess Liability / Umbrella Coverage
Instead of boosting individual policy limits, this coverage stacks additional protection atop your existing liability, fleet, and workers’ compensation policies. When catastrophic claims exhaust primary coverage, this backup fund activates.
Frequently Asked Questions
What insurance do I need for an excavation company?
You’ll need general liability (class 94007), inland marine for your equipment, and commercial auto. Once you hire someone, workers’ comp (NCCI 6217) is mandatory. Bigger operations need umbrella coverage ($1-5M), pollution liability, and sometimes bonds for municipal work. Don’t skip the equipment coverage, one excavator claim can wreck you.
How much does excavation insurance cost?
General liability runs 1.5% to 10.4% of revenue, so on $500K revenue, expect $10K-$30K annually. Workers’ comp hits hard at $3-8 per $100 payroll. Commercial auto adds $2-5K per vehicle. Total damage for a small operation? Usually 5-10% of gross revenue. Shop around though, we’re seeing 33-39% savings between carriers.
What is excavation insurance?
It’s specialized coverage for digging contractors handling trenching, grading, and site prep work. Protects against trench collapses, utility strikes, equipment damage, and when you accidentally bulldoze someone’s foundation. Standard package includes general liability, workers’ comp, equipment coverage, and commercial auto. Without it, one cave-in lawsuit could bankrupt your entire operation overnight.
What are the insurance class codes for excavation?
Main ones are 94007 for general liability (covers excavating to 12 feet, demolition, slopes under 20 degrees) and NCCI 6217 for workers’ comp (excavation & grading). Your dump trucks fall under commercial auto codes. These codes matter, wrong classification means paying 2-3x more than necessary or worse, denied claims.
Do I need umbrella insurance for excavation work?
Yeah, especially once you’re doing bigger projects. Basic GL covers $1-2M, but one bad trench collapse or utility strike can blow past that fast. Most excavators carry $1-5M umbrella coverage, costs around $750-2500 per million. Think of it as catastrophic protection, because when excavation goes wrong, it goes really wrong.