How Contractors Reduce Their Liability Risk

contractor liability insurance ontario
contractor liability insurance ontario
Apr 29 2022 4 min read

There are some things most contractors do because they know it will help keep themselves and their customers safe.

There are also some things contractors usually only do because they think it might help reduce the cost of their contractor insurance.

Below you’ll find a list of things that can help them do both.


Apart from the most obvious reason of less risk = safer, there are also financial incentives to reduce liability risk.

For one, how accident-free your business is will do good things for word of mouth, repeat business and the bottom line.

For another, preventing accidents and being less of a risk overall can save you money on your small business liability insurance and prevent you from becoming too big of a risk for an insurance company to consider taking on.

Contractors want to make it home in one piece after a long day, but if self-preservation isn’t your thing, then focus on reducing your risk for other reasons.

liability insurance Ontario


We’ve discussed the why now let’s get into the how.

Here are the most effective ways that a contractor can reduce their liability risk.


In Ontario, while some types of contractors do not legally require a license (i.e. bricklayer, carpenter, painter, roofer) others do (i.e. electricians) and others require a certificate or other qualification (i.e. plumber, gas-fitter). (1)

The process of getting licensed or certified often involves special training which in part is meant to help ensure a contractor is aware of all relevant safety information.

You should also be aware that even if you’re one of the trades who are not required to be licensed by The Ministry of Training, Colleges and Universities in Ontario there may be municipal by-laws that do require it.

For example, St. Catharines requires many businesses (including plumbers)to hold a trade license with them to operate within the city.


Most of us know the “call before you dig” rule through Ontario One Call, but contractors operating in the province should also be aware of a wider variety of safety regulations that they will need to follow.

Depending on the type of contractor you are, these regulations can include (2):

  • Fire safety
  • Dust control
  • Protective clothing
  • Elevated work platforms
  • Soil types
  • Hygiene

For a full run down, please visit Ontario.ca.

Like licensing, there may also be other local safety requirements you’ll want to familiarize yourself with, especially if you take on a job in a different city than you normally operate.


Aside from what may be required of you and your team through provincial or local laws, there are likely other special considerations unique to you, your business and your equipment when it comes to training employees.

Make sure everyone is thoroughly trained on all safety rules and that every employee has been taught the proper use of all equipment and tools.

The last thing you want is to come back from lunch to find someone on an unsecured ladder wielding an unfamiliar tool.


Have you ever noticed roofers working up high without being secured by a harness?

What about a carpenter using power tools without protective eye wear?

Make sure everyone on the job site has access to, and practices using all safety equipment and that the use of them is strictly enforced.

This includes making sure that everyone on a construction job site is wearing an IHSA approved helmet, something that is required in Ontario.


Contracts can be an important tool for contractors looking to reduce their liability risk.

Contracts not only help provide a clear outline of what’s expected for the project and define the relationship between the parties involved; they can also contain sections that help with risk management.

While there can be a lot of things put into a construction contract (LINK TO FUTURE BLOG ARTICLE), every contract should at least cover:

  • The full scope of the work involved (who, what, where, when, how)
  • Payment schedule (including checkpoints, amounts and deadlines)

This helps protect both sides and makes a civil liability case much less likely.


Most of us have heard it before; a clean job site is a safe job site.

It’s said often because it’s true.

The less clutter and disorganization there is on a job site the fewer tripping hazards there will be which is one of the primary causes of workplace accidents.


Let’s face it, a job site for most contractors involves at least 1 or 2 tools that can do some serious damage to a body or property if not cared for and used properly.

Whether it’s as small and simple as keeping hammers dry to avoid rust or as large and complex as cleaning the engine of an excavator, equipment maintenance should be a part of your routine if you’re looking to keep your liability risk low.

To illustrate the potential consequences of not doing so, consider the Hamilton construction company that was fined $200,000 for the death of a worker that the Ontario Ministry Of Labour says was caused by a machine missing a crucial piece safety component.


Even if every safety precaution, tool and lesson are adhered to daily, the nature of a dynamic job site can still result in the occasional accident.

It’s important to ensure you and your customers are protected by having comprehensive small business insurance.

Insurance helps protect contractors by covering them from liability claims and other associated risks.

If you’re interested in getting a quote for contractor insurance, please contact us anytime.

Erie Mutual Insurance proudly serves the commercial insurance, farm insurance, home insurance and auto insurance needs of members throughout Southern Ontario including Haldimand, Niagara and Hamilton.

Please don’t hesitate to contact us with any questions you may have about this or any other topic related to your insurance.



1 – trustedpros.ca
2 – ontario.ca


Read the Latest Articles

View All
Erie Mutual
Canadian insurance company