Here's the thing about running a roofing business: you're managing one of the riskiest operations in construction. Your crews work at heights, handle heavy materials, drive equipment-loaded trucks, and face weather conditions that would send most people indoors. One accident could wipe out years of profit if you don't have the right insurance in place.
But roofing contractor insurance isn't just about protecting yourself from disaster. It's about getting the contracts you want, meeting legal requirements in your state, and sleeping better at night knowing your business can weather any storm. This checklist walks you through exactly what coverage you need, when to add it, and what to review each year.
Essential Coverage Every Roofing Contractor Needs
General liability insurance is your first line of defense. If a customer trips over your ladder and breaks an arm, or if falling debris damages a neighbor's car, this policy handles the medical bills and legal fees. The industry standard is $1 million per occurrence with a $2 million aggregate limit, but here's what most roofing contractors don't realize: commercial projects often require $3-5 million in coverage before you can even bid on the job.
Expect to pay around $267 per month (about $3,200 annually) for general liability coverage. That's significantly higher than other trades like painting because insurers know roofing work comes with elevated risks. Your actual premium depends on your revenue, location, claims history, and the type of work you perform. California and Florida contractors typically face the highest rates due to natural disaster exposure.
Workers' compensation insurance is mandatory in most states if you have employees, and in California, even solo C-39 roofing contractors must carry it. This coverage pays medical expenses and lost wages when employees get injured on the job. Roofing carries one of the highest workers' comp rates across all construction trades, often costing 20-50% of your total payroll.
Why so expensive? Falls, heat exposure, repetitive motion injuries, and equipment accidents are daily risks in roofing. Classification code 5551 covers most roofing contractors, and insurers price these policies based on the very real danger your team faces every time they climb a ladder. Think of it this way: you're not just paying for insurance, you're protecting your business from a lawsuit that could cost hundreds of thousands if an injured worker decides to sue.
Commercial auto insurance is required in every state except New Hampshire if your roofing business owns vehicles. Your personal auto policy won't cover accidents that happen while you're hauling shingles to a job site or driving between projects. This coverage protects your trucks, vans, and trailers, and covers injuries or property damage you cause while operating work vehicles.
Budget around $173 per month ($2,076 yearly) for commercial auto coverage. This includes collision coverage for damage to your vehicles, comprehensive coverage for theft and weather events, and liability protection for third-party injuries. If employees drive their personal vehicles between job sites, add hired and non-owned auto coverage to protect your business from liability.
Optional Coverage That Protects Your Bottom Line
Inland marine insurance (also called tools and equipment coverage) protects your gear wherever you take it. Standard property insurance only covers fixed property at your business location. But your ladders, scaffolding, power tools, roofing nailers, compressors, and tear-off equipment move between job sites every day. If they're stolen from a work truck overnight or damaged at a project, inland marine coverage handles replacement costs.
A comprehensive policy should also cover materials from the moment you take possession until installation. Shingles, underlayment, flashing, and fasteners are protected whether stored at your shop, loaded on vehicles, or staged at job sites. Coverage typically costs 1-3% of the total value annually, with premiums sometimes reaching $3 per $100 of coverage for small tools and equipment. That's a small price compared to replacing $50,000 worth of stolen equipment out of pocket.
Commercial umbrella insurance kicks in when a claim exceeds your primary liability limits. Say you have a $1 million general liability policy and get hit with a $2.5 million lawsuit after a serious accident. Without umbrella coverage, you're personally liable for the extra $1.5 million. With it, your umbrella policy pays the difference.
You should add umbrella coverage when you land large-scale commercial projects, work on high-value residential properties, or face contractual requirements for higher liability limits. Many construction contracts explicitly require contractors to carry additional coverage beyond standard limits. Umbrella policies typically provide $1-5 million in extra protection, and they're especially important if you operate multiple commercial trucks (a major source of liability claims).
When to Add or Upgrade Coverage
Add workers' compensation the moment you hire your first employee. In some states like California, you need it even before hiring anyone. Don't risk operating without it—the fines and legal consequences aren't worth saving a few months of premiums.
Upgrade your general liability limits when you start bidding on commercial projects or high-end residential work. If you're only doing small residential repairs, $1 million may suffice. But once you're re-roofing a $2 million home or working on a commercial building, you need higher limits to protect yourself and meet contract requirements.
Consider inland marine coverage once you've invested significantly in tools and equipment. If losing $10,000 worth of gear would seriously hurt your business, this coverage pays for itself the first time something gets stolen or damaged.
Annual Review Checklist
Your insurance needs change as your business grows. Set a reminder to review your coverage every year, ideally before your policy renewal date. Here's what to check:
Revenue and payroll: If your annual revenue or employee payroll has increased significantly, update your insurer. Underreporting can lead to denied claims or surprise bills at audit time.
Equipment inventory: Added new tools or vehicles? Update your inland marine and commercial auto policies to ensure everything's covered at replacement value.
Project types: Shifting from residential to commercial work? You'll need higher liability limits and possibly additional coverage types.
Claims history: Even small claims can affect your premiums. Review what happened and whether you can implement safety measures to reduce future risks.
Contractual obligations: Are clients requesting higher coverage limits? Don't wait until you lose a bid to upgrade your policy.
Getting Started with Roofing Contractor Insurance
Start with the essentials: general liability, workers' compensation (if you have employees), and commercial auto (if you own vehicles). Get quotes from multiple insurers who specialize in contractor coverage, as they understand your specific risks better than general business insurers.
Many insurers offer bundled policies (called a Business Owner's Policy or BOP) that combine general liability, property insurance, and business interruption coverage at a discount. Bundling can save you 20-28% compared to purchasing each policy separately.
Insurance isn't the most exciting part of running a roofing business, but it's what keeps you operating when things go wrong. A single uninsured accident could cost you everything you've built. Take an hour to review this checklist, compare quotes, and make sure you're properly protected. Your future self will thank you.
