David WickerWhen you think of construction or subcontracting, the first images that come to mind are hard hats, cranes, and crews on the job site. But for investment property owners, the real work often happens behind the scenes: securing the right insurance coverage to protect your assets, tenants, and long-term investment goals.
At CH Insurance, we’ve seen too many cases where property owners assume their standard policy automatically covers the risks of hiring subcontractors or initiating construction projects. Unfortunately, that assumption can be costly. The overlap between property ownership and construction is full of hidden liabilities, and understanding them is the first step toward real protection.
Why Liability Expands with Subcontractors
Whenever an investment property owner hires a subcontractor—whether for renovations, roofing, electrical, or plumbing—they take on additional risk. If a subcontractor is injured on site, or if their work causes damage, lawsuits may be directed not only at the contractor but at the property owner.
One common example: a subcontractor’s employee falls from scaffolding. If that subcontractor’s insurance is inadequate—or nonexistent—the property owner can be pulled into litigation. Even if the owner had no direct involvement in the accident, the legal and financial exposure can be significant.
Certificates of Insurance Aren’t Enough
Many property owners request a certificate of insurance (COI) from subcontractors and believe that’s sufficient protection. It’s a good first step—but it’s not the full picture. Certificates don’t guarantee coverage is active, nor do they reveal exclusions in the policy. We advise property owners to require not only proof of insurance but also contractual agreements that protect them through indemnification and additional insured endorsements.
The Overlooked Risks of Renovation
Even small renovation projects—say, updating a multi-unit property’s bathrooms—can carry big risk. If work leads to water damage, mold growth, or tenant displacement, claims can snowball. Standard landlord policies often exclude these construction-related exposures. That’s why a tailored policy review before starting projects is critical.
Risk Transfer: Your Best Defense
Risk transfer is the process of shifting liability away from the property owner and onto the subcontractor or general contractor where it belongs. This involves carefully drafted contracts, diligent review of insurance certificates, and proactive communication with your insurance advisor. Done properly, risk transfer helps property owners protect both their real estate investment and their bottom line.
Partnering for Peace of Mind
Investment property is one of the most important assets a person can own. Protecting it means going beyond bricks and mortar—it means building a risk management plan that accounts for contractors, subcontractors, and every worker who steps on site. At CH Insurance, we work with property owners every day to identify gaps, align coverages, and ensure they’re not carrying someone else’s liability.
A qualified attorney is recommended to ultimately review your contracts. When bad things happen to good people, having the right insurance partner in your corner, can make all the difference.
About the Expert
With decades of experience in commercial insurance, David Wicker of CH Insurance specializes in helping business and property owners design coverage strategies that protect their investments and support long-term growth. Be sure to catch him on CH’s social media platforms every Wednesday with ‘Cornerstone Confessions,’ for Investment Property Insurance insights. Reach David at DWicker@CHInsurance.cc.
