⚠️ Senior Editor's Note (January 2026): The premiums listed below reflect estimated Commercial General Liability (CGL) rates in Canada for 2026. Insurance costs fluctuate based on revenue, location (ON, BC, AB), and claims history. Always request a personalized business insurance quote from a licensed commercial broker.
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| One Mistake, One Lawsuit. |
It starts as a routine Tuesday. You are a self-employed handyman or contractor finishing up a pipe repair in a client's basement in Toronto or Vancouver.
Then, disaster strikes. A joint fails, the pipe bursts, and water floods the newly finished basement. It ruins the hardwood floors, soaks the drywall, and destroys the client's vintage furniture. The damage assessment arrives: $45,000.
If you do not have insurance, that $45,000 comes directly from your personal savings. For many small business owners, this single mistake means immediate bankruptcy.
This is why Commercial General Liability (CGL) Insurance is not optional. It is the lifejacket for your business. In this guide, we reveal the real cost of protecting your livelihood in 2026 and why you simply cannot secure lucrative contracts without it.
No Certificate = No Job
Before we discuss premiums, let’s talk about opportunity cost.
Savvy homeowners and general contractors will demand a "Certificate of Insurance" before you even step foot on their property. They need proof that if accidental damage occurs, you have at least $2 Million in coverage to handle it.
If you cannot produce this document, you lose the job. It is that simple. Being insured is not just about protection; it is a vital marketing tool that signals professionalism and reliability.
How Much Does CGL Insurance Cost?
Insurance pricing is based on "risk exposure." A welder working with open flames presents a higher risk than a painter using a brush. Below are the estimated annual premiums for a small business with revenue under $100,000 as of 2026.
| Trade / Profession | Coverage Amount | Est. Annual Premium |
|---|---|---|
| Handyman / Painter | $2 Million | $475 - $700 |
| Carpenter / Flooring | $2 Million | $600 - $900 |
| Plumber / Electrician | $2 Million | $850 - $1,400 |
| General Contractor | $2 Million - $5 Million | $1,200 - $2,800+ |
(Note: Prices are 2026 market estimates for Ontario/BC/Alberta. High-risk activities like roofing or welding will cost significantly more.)
What Exactly Does It Cover?
Do not confuse this with "Tools Coverage" (that is an extra add-on). CGL covers Third-Party Liability—essentially, "legal responsibility for damage you cause to others."
- 1. Bodily Injury: A client trips over your extension cord and breaks their hip. You are sued for medical bills and pain/suffering. CGL covers the settlement and legal defense fees.
- 2. Property Damage: You accidentally drill into a hidden water pipe or drop a hammer on a granite countertop. CGL pays for the repairs.
- 3. Completed Operations: This is crucial. If a deck you built collapses six months after you finished the job and injures someone, this clause protects you.
Don't Forget Your Tools!
Here is a critical warning: Standard CGL Insurance does NOT cover your own tools.
If your van is broken into and $5,000 worth of DeWalt or Milwaukee tools are stolen, a basic liability policy pays $0. You must explicitly ask your broker to add a "Tools and Equipment Floater" to your policy. It typically costs an additional $150-$300 per year, but it is worth every penny.
Chief Editor’s Verdict
Stop viewing insurance as a "bill." View it as a "shield."
In Canada, lawsuits are becoming more frequent and settlements are getting more expensive. Working without insurance is like driving without a seatbelt—you might be fine 99 times, but the 100th time could destroy everything you have built.
Action Plan
1. Call a broker today and request a "CGL Quote for Contractors."
2. Insist on a minimum of $2 Million liability coverage (this is the industry standard).
3. Spend the extra few dollars a month to insure your tools against theft.
Protect your business, protect your clients, and secure those high-paying contracts with confidence.
LEGAL DISCLAIMER: This article is for informational purposes only and does not constitute legal, financial, or insurance advice. The premiums mentioned are estimates based on 2026 market data and are subject to change. This website is not an insurance carrier or a licensed broker. Coverage is subject to the specific terms, conditions, and exclusions of the policy you purchase. Please consult with a licensed professional in your province or territory before making any business decisions.
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