What is the minimum coverage limit required for general liability insurance?

The minimum coverage limit required for general liability insurance is set to ensure that contractors have adequate protection against potential claims resulting from bodily injury, property damage, or personal injury that could occur during the course of their work.

A limit of at least $300,000 per occurrence is established as it strikes a balance between providing sufficient financial coverage to manage risks associated with construction activities while considering the various scenarios that a contractor might encounter. This amount is typically seen as a threshold that allows for enough coverage to handle common claims that might arise from job-related incidents, thus safeguarding both the contractor's financial interests and providing peace of mind to clients and stakeholders.

The rationale behind having a specific minimum limit is to protect all parties involved in a construction project, ensuring that claims can be effectively addressed without risking significant financial burden on the contractor, which could ultimately affect the project's completion or the contractor's ability to operate.