Texas Subcontractor Insurance Requirements: What GCs Must Require from Subs
What coverage general contractors should require from subcontractors on Texas job sites — including the one rule Texas handles differently from every other state, and the few minimums Texas actually writes into law.
The most common mistake: assuming a Texas sub carries workers' compensation because every sub in every other state does. In Texas it is optional. A sub who opted out — a non-subscriber — can hand you a perfectly valid certificate with no WC line on it, and an injured worker then looks for someone else to sue.
Texas sets almost no insurance minimums for private construction, so a GC's subcontract does. The usual baseline is commercial general liability of $1M per occurrence / $2M aggregate, $1M commercial auto, workers' compensation with employer's liability, and an umbrella for larger jobs. Texas is the only state where workers' comp is optional for private employers, so confirm whether each sub carries it or is a non-subscriber. The exceptions are licensed trades — TDLR electrical and HVAC contractors and plumbing companies must carry general liability to hold their licenses — and public projects, where workers' comp is required by statute.
In this guide
Standard insurance requirements for Texas subcontractors
Most Texas GCs require five coverages before a sub can mobilize. These are commercial standards set in the subcontract, not state law — your prime contract with the owner will often set the floor you pass down.
| Coverage | Typical minimum | What it covers |
|---|---|---|
| Commercial General Liability | $1M per occurrence / $2M aggregate | Bodily injury and property damage from the sub's operations and completed work |
| Workers' Compensation | Statutory — if the sub carries it (see below) | Medical costs and lost wages for the sub's injured employees |
| Employer's Liability | $500K–$1M each accident / disease | Employee injury suits outside WC; usually part of the WC policy |
| Commercial Auto | $1M combined single limit | Vehicles used in the sub's operations |
| Umbrella / Excess | $1M–$5M, by project | Limits above GL, auto and employer's liability |
The minimums Texas does set for licensed trades
For three trades, holding the license depends on carrying general liability. These are the floors to hold a license — not what a GC should require — but a sub below them has a license problem as well as an insurance one.
| License | Agency | General liability required to hold it |
|---|---|---|
| Electrical Contractor | TDLR | $300K per occurrence / $600K aggregate / $300K products-completed operations |
| ACR Contractor — Class A | TDLR | $300K per occurrence / $600K aggregate / $300K products-completed operations |
| ACR Contractor — Class B | TDLR | $100K per occurrence / $200K aggregate / $100K products-completed operations |
| Responsible Master Plumber | TSBPE | At least $300K commercial liability |
TDLR electrical contractors must also show proof of workers' compensation or that they have elected not to carry it. For which trades need a license at all, see the Texas subcontractor license requirements.
Workers' compensation — Texas's unique rules
Texas is the only state where workers' compensation is not required by law for most private employers. An employer that opts out is a non-subscriber, and it must file a notice of no coverage (DWC Form-005) with the Texas Department of Insurance every year.
Opting out has a cost for the sub: under Labor Code §406.033 a non-subscriber sued by an injured employee cannot argue the employee's own negligence, assumption of risk, or a co-worker's negligence. It has a cost for the GC too — an injured worker whose employer carries no coverage will look at everyone else on the site.
What to require
- Require workers' compensation with statutory limits in the subcontract itself, not only on your COI checklist.
- If you accept a non-subscriber, require its occupational injury or employer's liability coverage and a copy of its current DWC Form-005 filing — and decide that deliberately, with your broker, rather than by default.
- Check that everyone the sub puts on site is its employee. Workers paid as 1099 contractors are a common gap in both WC and GL.
Public projects are different
On a building or construction contract with the state or any political subdivision — a city, county or school district — Labor Code §406.096 requires the contractor to certify workers' compensation coverage for everyone employed on the project, and each subcontractor to give the GC the same certificate for the GC to pass on. Non-subscribers cannot work those jobs.
A COI with no WC line is not an error to wave through. It is either a non-subscriber or a policy nobody listed. Ask which before the sub mobilizes.
Additional insured, waiver of subrogation and Chapter 151
Two provisions belong in every subcontract and should be backed by endorsements on the sub's policies:
- Additional insured status for your company (and the owner, where the prime contract requires it) on the sub's GL and auto policies, on a primary and non-contributory basis, for both ongoing and completed operations — see CG 20 10 vs CG 20 37.
- Waiver of subrogation in your favor on GL, auto and WC, so the sub's insurer cannot pursue you to recover what it paid.
The certificate should show both, but it is the endorsement on the policy that grants them — a line in the Description of Operations box does not.
Texas limits what additional insured coverage can do. Texas Insurance Code Chapter 151, the construction anti-indemnity statute, voids contract terms that require a sub to indemnify — or to provide additional insured coverage for — the GC's own negligence on most construction contracts. Claims for bodily injury or death of the sub's own employees are an exception, and residential construction is treated differently. Additional insured status still matters a great deal in Texas; it just does not reach as far as it does in some states. Have your broker or counsel review the insurance exhibit.
Adjusting minimums by project type
The baseline works for typical commercial work. Larger or riskier jobs warrant more — and whatever your owner requires of you should flow down to your subs.
| Project type | Suggested GL | Suggested umbrella |
|---|---|---|
| Residential remodel / small commercial | $1M / $2M | Often not required |
| Mid-size commercial ($1M–$10M) | $1M / $2M | $1M–$2M |
| Large commercial / industrial ($10M+) | $2M / $4M | $5M+ |
| High-hazard trades (demolition, roofing, structural) | $2M / $4M | $5M+ |
Collecting and tracking certificates of insurance
Knowing what to require is the easy part. Collecting a COI from every sub — and keeping it current as policies renew at different points in the year — is where most GCs fall behind. A certificate that was valid at onboarding can expire three weeks into a six-month job.
- Collect the certificate before work begins, never after.
- Read it against your subcontract: limits, the WC line, additional insured and waiver of subrogation.
- Track each policy's own expiration date — GL, auto and WC rarely renew together.
- Keep certificates where you can find them in an audit, not in a shared inbox.
How TrackMyVendor automates this
- Every certificate is read on upload — carrier, policy numbers, each coverage row’s limits and its own dates — and measured against the minimums you set, so a missing WC line or a $500K GL limit shows as short.
- Subs upload through a one-time link from their phone, with no account to create.
- Per-deadline reminders at 90, 60, 30 and 7 days go to your team and to the sub, with the upload link in the sub’s copy. Starter and above
- The endorsement pages are read too — additional insured, waiver of subrogation, primary and non-contributory — so a ticked box with no endorsement behind it shows as a gap. Pro
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