Insurance Government Contractors

Your business is looking to grow and make a name for itself. You’ve got the best employees, and you’re making great products. But one thing is holding you back, insurance. If something goes wrong, and it could happen to anyone, you need to be prepared with the right coverage, especially for government contractors working in other countries.

This article will review the types of insurance government contractors must have, from worker’s compensation and general liability to auto insurance. After reading this article, you’ll know just what your business needs for it to thrive for years to come.

Importance of Having Insurance for Government Contractors

The government is one of the largest contractors in the world. They hire companies to complete work on behalf of the government, and they often do so through contracts. Government contractors must be well-versed in what they can and cannot do and how to file for payment when they’ve completed their work properly.


One important thing that government contractors need to know is how insurance can help them with their business. Insurance can protect you from several risks of running a company, including compensation, liability, auto insurance, and more.

Before signing any contracts with your clients, you must understand what types of insurance you need. It will help ensure your business stays on track and continues growing without major setbacks due to unexpected events. Hence, you must need some insurance before signing contracts with the government.

If you are looking to find insurance for government contractors, go with a firm that is accredited by multiple awards. You can find the list of rewards a company receives on its website. Mostly, the rewards are listed on the home page, but you can also look for a separate awards and recognition page.

Sahouri, an insurance advocacy firm, has listed its awards on its website. The company has received the Global Broker of the Year award from Cigna, the Gold Stevie Winner Customer Service award, Family-Owned Business Award from Washington Business Journal, and many more. You can go through the entire list on its website.

Worker’s Compensation

Worker's Compensation

Worker’s compensation insurance is required by law and covers injured employees’ medical expenses and lost wages. Employers pay for it, so you don’t have to worry about paying a premium or deductibles. It also covers dependents in case they’re injured while working with you.

Workers’ comp covers most injuries sustained while doing your job, including those that happen off-site but are related to it. However, there are some exclusions. For example, if an employee gets hurt because of their negligence or misconduct, the worker’s comp won’t pay out any benefits unless it was mandated by state law beforehand.

General Liability

General liability insurance is one of the most important types of government contractor insurance you will need. General Liability covers your company for claims related to bodily injury and property damage that results from your business operations, including:

  • Employees’ accidents on the job site
  • Damage caused by faulty products or services provided by you
  • Third-party claims against you because they were hurt while on your premises

General Liability policies also include coverage for defense costs and additional expenses related to lawsuits, such as court costs and other out-of-pocket expenses associated with defending yourself against legal action brought against you by someone else. Take the instance of Iredell County, where the General Liability coverage is $2,000,000 combined single limits, with a $1,000,000 annual aggregate.

Business Interruption

Business Interruption

Business interruption insurance is a form of property insurance that covers the costs associated with your business being unable to operate as usual. This can happen if you have a fire or other natural disaster or are shut down by civil unrest or terrorism in your area.

Business interruption insurance is often included as part of broader contractor liability policies, but it’s not always mandatory for government contractors to carry. Suppose you don’t have one, and something happens to your building or equipment while under construction. In that case, this type of coverage will help cover any losses associated with getting back up and running again once repairs are complete.

If you decide to buy business interruption coverage, there are two types. Single peril coverage protects only those specific events listed within its terms, and all risk policies protect against all losses arising from any cause.

Single perils policies are cheaper than all risk policies because they offer less protection, but both provide valuable peace of mind when disaster strikes. One recent example comes from the pandemic era when Wimbledon stopped tournaments, but luckily they had insurance to cover their losses. It received US$142 million in payout for canceled matches.

While the example above is around sports, the same can happen with businesses operating with the government on a contractual basis. So business interruption insurance will ensure that you don’t incur loss even if the government withdraws a contract for some reason.

Auto Insurance

Auto Insurance

Auto insurance is a type of insurance that protects you from financial losses caused by car accidents. It can also cover other vehicle damage types, including theft and vandalism. According to Statista, the average cost of car insurance for a 17-year-old male in the US in 2022 was $4,946.

Auto insurance premiums vary depending on many factors, such as age, gender, and driving record. Prices are typically higher for younger drivers because they’re statistically more likely than older ones to get into accidents. However, if you’re over 40 years old and haven’t had any citations within the past three years, you can get good deals on auto policies by shopping around with different providers.

Worldwide Liability

You must ensure your worldwide liability insurance is current if you’re a government contractor. It’s an essential policy that protects you from lawsuits in other countries and provides coverage for things like fines and penalties incurred by violating the law of another country.

The best way to understand how this type of insurance works is by examining its relationship with other policies. For example, if someone sues you for damages related to an accident involving their property or person and wins their case, they can seek reimbursement through the court system. Worldwide liability insurance can help in such a situation.

Inland Marine Insurance


Inland Marine Insurance covers loss or damage to property you own or rent, including your business equipment and tools. It also covers loss or damage to property belonging to your customers, employees, and others not insured under your policy. Inland Marine Insurance provides coverage for the following:

  • Tangible property
  • Computer hardware and software used in conducting business activities
  • Supplies for use in manufacturing or processing operations


In conclusion, government contractors need to understand the types of insurance they need. Although some may seem like common sense, others may not be as obvious. Remember all these insurance packages and choose the one you require based on your work.