Running the Business · Module 2
Template: the insurance requirements matrix. Who demands what, and the certificate that satisfies each one
A one-page matrix of every party that will ask you for proof of insurance, what each one is legally entitled to demand versus what each one usually demands anyway, and the exact certificate or endorsement that satisfies them. Fill in your own policy numbers once and the sheet becomes the answer to every "send me your COI" email. The worked example shows the sheet for a sole-owner C-36 with the stack from lesson 1.5.
What the full lesson covers
- CSLB requires, by statute: the $25,000 contractor's bond; a qualifier bond when the qualifier is an RME or a small-share RMO; a workers' compensation certificate or exemption; and, for an LLC only, the $100,000 employee bond and $1,000,000 liability insurance.
- Homeowners are entitled by statute to see, in the contract, whether you carry general liability and with whom, and whether you carry workers' compensation; nothing requires you to carry either for a sole owner, but the contract will say if you do not.
- General contractors, property managers, and commercial customers are not bound by statute; they demand what their contracts say, typically general liability with additional insured and waiver of subrogation, commercial auto, and workers' compensation, on a certificate naming them.
- Keep one master certificate on file and a broker who will issue a counterparty-specific certificate the same day.
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More lessons in Setting Up the Business
- 1The entity is a one-way door: why you decide sole owner, LLC, or corporation before the license issues
- 2Sole owner vs. LLC vs. S corporation for a plumbing contractor: liability, tax, cost, and the small claims limit
- 3EIN, the business bank account, and separating the money: the first bookkeeping setup that survives an audit and a lawsuit
- 4City business licenses: every city you work in, the Los Angeles business tax, and the seven-day rule