A Five-Step Checklist for Stronger Construction Project Protection

In construction, even the smallest oversight can result in costly claims, project delays, and disputes over who is responsible for payment. A strong risk transfer strategy ensures that liability remains with the party most capable of controlling and insuring against the risk, which is typically subcontractors and vendors directly performing the work. Using a structured checklist can help owners and general contractors build consistent protections across every project.

“As projects grow in complexity and cost, layered risk transfer becomes more than a best practice; it is a financial safeguard,” said Brian Rome, Risk Control Manager at Safety National. “When liability is contractually and properly shifted, it not only reduces uninsured exposures but also provides owners and general contractors with greater leverage and predictability in resolving claims.”

This five-step checklist outlines the core measures every project team can adopt to help minimize loss exposures, strengthen contractual protections, and ensure project outcomes are safeguarded.

1. Draft and Review Indemnification Provisions

• Require hold-harmless and indemnification clauses in all subcontractor and vendor agreements.
• Make sure the language complies with state anti-indemnity statutes.
• Allocate liability to the party with control over the work or hazard (e.g., the subcontractor for their scope of work).
• Review with legal counsel before execution.

2. Collect and Verify Certificates of Insurance (COIs)

• Require a COI before work begins from every subcontractor and vendor.
• Confirm these key details:
  • Policy limits meet contract requirements
  • Coverage is active through the project duration
  • Carrier is reputable and licensed in the project’s state
• Treat the COI as a snapshot, not a guarantee, and always follow up with policy documents.

3. Secure Additional Insured Endorsements

• Require additional insured endorsements naming the owner and general contractor.
• Confirm endorsements are specific and broad, covering both:
  • Ongoing operations (work performed)
  • Completed operations (post-construction liability)
• Keep copies of the additional insured endorsement with project files.
• Ensure coverage applies to primary and non-contributory, so the subcontractor’s insurance responds first.

4. Require Waivers of Subrogation and Notice of Cancellation

• Waiver of Subrogation: Prevents the subcontractor’s insurer from pursuing recovery against the owner or general contractor.
• Notice of Cancellation: Require written notice (typically 30 days) before a subcontractor’s policy is canceled or materially changed. These provisions help avoid unpleasant surprises mid-project.

5. Monitor and Enforce Compliance Throughout the Project

• Keep a risk transfer compliance log for tracking:
  • COI receipt and expiration dates
  • Policy renewal confirmations
  • Endorsement verification
• Do not allow subcontractors to mobilize or continue work with lapsed or non-compliant coverage.
• Engage insurance professionals and legal counsel for periodic audits.

Using a checklist may help protect owners and general contractors from absorbing subcontractor negligence. It may also help reduce uninsured loss exposures, create consistency across multiple contracts and trades, and improve leverage when resolving claims and disputes.