For construction companies in Virginia, having the right insurance is crucial for protecting your business. As a contractor, you face diverse risks ranging from property damage and employee injuries to lawsuits and cyber attacks. Purchasing adequate, cost-effective insurance tailored to your operations can safeguard your assets and future. 

This guide will uncover insurance costs for Virginia contractors across popular policies like general liability, workers’ compensation, bonds, equipment coverage, and more. We’ll explore the key variables impacting your premiums, provide benchmarking data for small, medium and large contractors, and suggest strategies to secure favorable rates.

Understanding typical contractor insurance expenses in Virginia allows you to evaluate policies suitable for your business. While your exact premiums depend on your unique attributes, this data offers helpful context to inform smart insurance decisions.

Contractors in Virginia need to have the right contractor insurance. This includes general liability insurance for contractors to protect against third-party claims and workers’ comp insurance for contractors to cover employee injuries sustained while working.

Key Factors Influencing Insurance Costs for Contractors

Here are some key factors that can influence insurance costs for contractors:

Type of work – The type of contracting work being done (construction, plumbing, electrical, etc.) impacts risk and therefore insurance rates. Higher risk work typically has higher insurance premiums. For example, a general framing contractor may have lower rates than a roofer or electrician, as roofing and electrical work tend to have more inherent hazards.

Years in business – Contractors who are new to the business often pay higher premiums until they establish a track record over several years. Insurance companies view experience as an indicator of lower risk. A contractor who has been operating successfully for 5-10 years is seen as less risky than a new startup.

Claims history – Prior claims made by a contractor will often result in increased premiums. Too many claims or large losses can make a contractor uninsurable altogether. A clean claims history with few if any major claims will help lower rates.

Coverage limits – Higher levels of coverage for things like general liability or workers’ compensation mean higher premiums. Contractors must weigh the cost versus the amount of protection needed. Lower limits can save on premiums but may expose the contractor to uncovered losses if a large claim occurs.

Number of employees – More employees on payroll increases the risk exposure for things like workers’ comp. Rates will be higher as a result, as more employees means more potential for claims.

Safety record – Contractors with poor safety records or OSHA violations can expect to pay higher premiums. Those who are proactive about safety by training employees, enforcing rules, and providing protective equipment can reduce risk and premiums.

Business size – Larger contracting firms often get better rates based on economies of scale and their ability to spread risk over more work and employees. Smaller firms may pay more as they represent a higher per-contractor risk to insurers.

Insurance provider – Rates can vary significantly between insurance companies. Competitive bidding is wise to find insurers offering the best combination of financial strength, service, and fair premium pricing.

The key is to maintain excellent records, safety practices, qualifications, appropriate coverage limits, and work with specialized brokers to help minimize insurance costs. Controlling risk is what lowers premiums over the long haul.

Small, Medium, Large Contractor Benchmarking in Virginia

The table below displays our definition for small, medium and large contractors in Virginia alongside typical insurance coverages. This helps provide you with a general benchmark to understand how your costs may compare:

CriteriaSmall ContractorMedium ContractorLarge ContractorXL Contractor
Worth of Tools$5K$10K$25K$50K
General LiabilityYesYesYesYes
Workers’ CompYesYesYesYes
Commercial AutoYesYesYesYes
Inland MarineYesYesYesYes
Virginia Average Total Insurance Premium

Keep in mind premiums fluctuate based on your unique attributes like location, services, safety record, number of employees and vehicles, payroll, and revenue. Contractors who secure tailored coverage with quality carriers and favorable terms may achieve rates well below the averages and toward the lower end of the ranges we provide in the benchmarking that follows.

If in doubt, we encourage you to explore your program with our network of highly skilled and specialized brokers. The brokers in our network specialize in helping contractors realize savings by accessing the right carriers and tailoring coverage to the specific contractor business.

General Liability Insurance Costs in Virginia 

Virginia Average Premiums for General Liability

General liability, also known as contractor’s liability, protects your business if a third party alleges property damage or bodily injury caused by your construction operations. It covers legal defense costs and compensatory damages you become legally obligated to pay due to covered claims.

– Small$600$1,800$1,000
– Medium$1,200$4,000$2,500
– Large$2,700$8,500$4,800
– Small$3,200$7,200$4,400
– Medium$5,800$15,000$11,200
– Large$12,500$25,100$20,300
– Small$800$1,600$1,100
– Medium$1,700$3,700$2,700
– Large$3,300$6,600$5,100
– Small$558$1,607$1,000
– Medium$1,191$3,879$2,400
– Large$2,373$8,265$4,800
– Small$1,100$2,500$1,700
– Medium$2,800$7,000$4,300
– Large$6,000$13,400$8,900
– Small$1,200$2,100$1,500
– Medium$2,800$6,300$4,000
– Large$6,000$12,400$8,200
General Contractor
– Medium$2,400$4,600$3,300
– Large$5,300$6,890$5,900
– XL$10,000$16,200$13,500

Typical premiums for general liability insurance range from 1% to 5% or more of annual revenue, for $1 million per occurrence limits. Here are typical annual premium ranges for Virginia contractors:

– Small Contractors – $1,500 to $7,500    

– Medium Contractors – $5,000 to $25,000  

– Large Contractors – $10,000 to $50,000

– XL Contractors – $25,000 to $125,000+

There are several key factors that influence general liability insurance costs for contractors in Virginia:

Type of work – Certain types of higher-risk contracting work like roofing, plumbing, electrical, and demolition have higher premiums. The more hazardous the work, the higher the liability insurance costs due to increased risks.

Revenues – Contractors with higher annual revenues will generally pay more for liability coverage, as they have greater overall exposure. Insurance companies use revenue as a proxy for a business’s size and aggregate risk level.

Claims history – Contractors with past general liability claims filed against them will see increased premiums, especially if the claims involved large payouts. Too many claims or large losses can make some contractors uninsurable altogether. Maintaining a clean claims history helps lower rates.

Years in business – Newer contractors are viewed as higher risk and will pay more until they establish a solid track record, while contractors who have been in business for many years tend to get better rates.

Risk transfer – Contractors who take steps to transfer or reduce risk, like requiring subcontractors to carry General Liability insurance and Workers Comp, and requiring COIs from subcontractors, will pay lower premiums.

Policy limits – Higher liability policy limits equal higher premiums. But lower limits may expose contractors to potentially uncovered losses from larger claims. Most experts recommend $1M – $2M per occurrence minimums. 

Deductibles – Choosing a higher deductible (e.g. $5k instead of $1k) reduces premiums but increases the out-of-pocket costs for the contractor on each covered claim.

Insurance company – The insurer’s financial strength, reputation, and premium rates influence costs. An insurer with a strong payout record who offers fair premium pricing can help lower overall costs.

Workers Compensation Insurance Costs in Virginia

Virginia Average Premiums for Workers Compensation

Workers’ compensation insurance covers employee injuries, disability, medical care, lost wages, and other costs caused by on-the-job accidents and illnesses. It provides statutory benefits set by Virginia law.

– Small$835$1,827$1,044
– Medium$2,349$5,167$3,131
– Large$3,653$8,089$5,219
– Small$1,231$2,693$1,539
– Medium$3,462$7,617$4,616
– Large$5,386$11,926$7,694
– Small$1,653$3,616$2,066
– Medium$4,649$10,227$6,198
– Large$7,231$16,012$10,331
– Small$888$1,943$1,110
– Medium$2,498$5,495$3,330
– Large$3,885$8,603$5,550
– Small$3,835$8,389$4,794
– Medium$10,786$23,729$14,381
– Large$16,778$37,151$23,968
– Small$2,979$6,516$3,723
– Medium$8,378$18,431$11,170
– Large$13,032$28,857$18,617
General Contractor
– Medium$11,506$25,169$14,382
– Large$17,978$39,551$23,970
– XL$33,558$74,307$47,940

For contractors, premiums for Workers’ Comp insurance in Virginia can vary substantially based on risk factors. Here are typical annual premium ranges: 

– Small Contractors – $1,000 to $5,000    

– Medium Contractors – $5,000 to $20,000

– Large Contractors – $10,000 to $50,000  

– XL Contractors – $50,000 to $250,000

Several key factors influence Workers’ Comp insurance premiums for contractors in Virginia:

Payroll – Payroll and number of employees factor directly into comp premium calculations. Higher total payroll equals higher premiums.

Class codes – The type of work performed by employees is assigned various risk class codes. Higher risk work has higher rates.

Experience Mod – Contractors are graded on past loss history via their Experience Mod. Those with fewer or lower cost claims get a credit reducing premiums. Too many claims lead to a debit increasing premiums.

Industry trends – Premium rates within the construction sector influence costs. Rates rise across the board if industry-wide losses trend upward.

Safety record – Good safety and low past claim frequency helps contractors qualify for premium discounts. High injury rates lead to increased premiums.

Subcontractor coverage – Using uninsured subcontractors increases exposures and Workers’ Comp premiums. Requiring subs to carry their own coverage lowers a contractor’s risk and premiums.

State laws – Each state has laws governing benefits, exclusions, premium discounts, etc. These variables directly impact premiums paid by contractors.

Deductible programs – Higher deductibles lower premiums but increase the out-of-pocket costs for the contractor for each claim.

Carrier strength – The financial strength, reputation and premium rates offered by the insurance carrier influences overall costs.

Overview of Additional Insurance Coverages 

In addition to General Liability and Workers’ Compensation, contractors in Virginia need supplemental insurance policies to handle other risks:

Commercial Auto Insurance

Covers vehicles used for business purposes – both liability and physical damage. Typical limits are $1M liability/500K physical damage. Average premiums range from $1,000 – $3,000 per vehicle.

Inland Marine (Tools/Equipment) Insurance 

Covers tools, equipment, machinery, and contractor-owned materials against loss and damage. Useful for contractors with significant investments in equipment. Average premiums range from $1,000 to $3,000 annually for $10K to $25K in coverage limits.

Surety Bonds

Required bid, performance and payment bonds for public works and many large private projects. Premiums typically range from 1-3% of the bond amount, depending on contractor qualifications and credit. 

Builder’s Risk Insurance

Covers structures under construction against damage until project completion. Premiums vary by project size and risk factors.

Commercial Property Insurance

Protects physical business locations like offices, warehouses, showrooms against property damage from causes like fire, wind, theft. Average premiums range from $1,000 to $10,000 annually depending on property values.

Business Owner’s Policy (BOP

Bundles General Liability, Property, and other coverages together under one policy. Simpler than separate policies. Average premiums range from $2,000 to $15,000+ depending on operations.

Employment Practices Liability 

Protects against employment lawsuits around discrimination, sexual harassment, wrongful termination. Helps pay legal fees and settlements. Average EPLI premiums range from $2,000 to $5,000 per year.

Cyber Liability Insurance

Covers costs related to data breaches, hacking incidents, electronic theft, and online fraud. Premiums typically range from $500 to $2,500 annually.

Umbrella Liability Insurance

Provides additional liability limits above other policies like General Liability and Auto. Added peace of mind and protection. Average premiums range from $500 to $1,500 per $1 million in additional coverage.

Professional Liability

Covers design and engineering professionals against errors, omissions or negligence claims. Protects against potential lawsuits and liability. Average premiums range from $2,500 to $5,000 per year.

The specific insurance policies and limits a contractor needs depends on the company’s unique risk exposures and assets. It’s critical to work with an insurance agent or broker who understands contractor risks to customize a program providing adequate coverage.

How Contractors Can Reduce Their Insurance Costs 

While insurance is crucial, there are strategies Virginia contractors can use to help control and reduce premiums:

Enforce robust safety protocols – Prioritizing safety and reducing injuries is the #1 way to control Workers’ Comp costs over time. Slips, falls, and manual handling causes many contractor injuries. Focus training and prevention efforts here. Enforcing PPE use is also critical.

Document rigorous subcontractor screening/management procedures – Uninsured subcontractors can drive up a contractor’s premiums quickly. Require all subs to carry General Liability, Workers’ Comp, and Auto Liability coverage with proper limits, and collect current COIs. Screen sub qualifications thoroughly upfront before hiring.

Consider higher deductibles – Choosing higher deductibles for policies like General Liability, Auto and Workers’ Comp saves money on premiums. Just be sure you have adequate cash reserves in case claims arise.

Ask about contractor credits – Insurers offer a variety of credits and discounts for things like safety programs, drug testing, new business, and contractor association membership. Be sure to inquire about discount opportunities.

Review loss runs regularly – Loss run reports detail past claims on your policies. Reviewing these and identifying trends helps target areas to reduce future claims activity. Addressing electrical cord safety could help reduce costs for electrical contractors, for example.  

Compare quotes regularly – The insurance market fluctuates, with new carriers entering and existing ones adjusting rates. Getting fresh quotes each renewal allows you to switch providers if better rates are available.

Trim unnecessary coverages – Assess whether all current coverages are truly needed. Eliminating unnecessary ones like employment practices liability for a small 1-person contractor could potentially reduce costs.

Raise deductibles and limits carefully – Consider raising deductibles and lowering liability limits on some policies judiciously to reduce premiums, but avoid exposing the business unnecessarily. Have adequate reserves for higher deductibles.

Improve loss control – Preventing losses is less costly than dealing with claims down the road. Take proactive steps like more jobsite inspections, hazard awareness training, tool/equipment maintenance, and job planning with subcontractors.

Controlling controllable risks and losses is the most sustainable way for contractors to keep insurance costs in check over the long term. Partnering with a savvy insurance agent or broker is also key to optimize one’s insurance program.

Virginia Contractor Insurance with

Are you a Virginia contractor looking to protect your business and secure its future? Look no further than, your dedicated partner in contractor insurance. We understand the unique risks construction professionals face and are committed to providing tailored insurance solutions to meet your specific needs. 

Why Choose

Specialized Expertise – Our network of insurance advisors focuses exclusively on contractor businesses. We know the intricacies of the contractor insurance market inside and out.

Access to Top Providers – We maintain partnerships with leading insurance carriers across all major contractor policies. This provides you with a one-stop-shop to compare quotes.

Cost-Effective Coverage – Our advisors will help configure your insurance with optimal limits and deductibles to help meet your budget while still protecting your business appropriately.

Coverage Gaps Addressed – We perform coverage gap analysis to ensure you have adequate insurance in place and are not overpaying for unnecessary coverage.

Ongoing Policy Review – We review your policies at renewal as your business evolves to confirm you are properly covered and achieving the best rates.

Claims Advocacy – We act as your advocate for claims to achieve optimal settlements and stay involved through the entire claims process.

Don’t leave your business exposed. Partnering with gives you confidence that your company has the insurance needed to protect its future. Get a quote today to start securing comprehensive and cost-effective contractor insurance tailored to your operations.