In addition to state license requirements, any person or company actively involved in general contracting must maintain several types of insurance to protect their clients in case of accident or failure to perform a contract. Some types of insurance are required by the state, while others are required by local jurisdictions.
The only insurance for contractors mandated by Virginia is workers' compensation. Any contractor doing business in Virginia must obtain and keep workers' compensation insurance if the contractor has three or more employees. Although it is not required of contractors with less than three employees, they may choose to purchase workers' compensation insurance as well. Workers' compensation insurance is the only legal recourse for workers to receive beneifts if they are injured on the job in Virginia. The program is administered by the Virginia Workers' Compensation Commission.
General liability insurance covers property loss and bodily injury to non-employees of the contractor. While the state doesn't impose any general liability insurance requirements on contractors, most building departments in the state require proof of general liability before a building permit will be issued. Check with your local building department for more information.
Surety bonds are required by most local building departments. They provide monetary compensation to a client if the contractor fails to fulfill the contract.
The Virginia Department of Motor Vehicles requires minimum insurance coverage on all vehicles. A general liability policy may provide additional benefits and coverage as well.