Builders working across state lines
Working across state lines multiplies the administrative load. Each state has its own licence, its own workers compensation rules and its own insurance minimums, and the gaps between them are where contractors get caught.
The most common gap is workers compensation. It is written state by state, and a policy written for one state generally does not cover an injury that happens in another. A crew sent across a state line for three weeks is a real exposure, and the injury that happens in week two is the one that is not covered.
The second is payroll reporting. Workers compensation premium is calculated by state at that state's rates and classifications. Payroll earned in another state that was reported under the home state's rate produces an audit adjustment, and the adjustment is usually larger than the premium would have been if it had been reported correctly from the start.
A handful of states recognise licences from states with comparable requirements, but reciprocity is the exception rather than the rule. Most states require their own licence, often with their own exam, their own fee and their own insurance minimums. Some states also require registration in addition to licensing, and local jurisdictions may require a permit on top of both.
The practical consequence is that a job across a state line can require more paperwork than a much larger job at home. Contractors who price the work without pricing the compliance regularly find that a profitable out of state project was not profitable at all.
Eight coverages cover almost everything a construction business faces. They do different jobs, and buying one does not cover the others.
Third party injury and property damage caused by your operations.
Medical care and lost wages for your own injured employees.
Vehicles used in the business, including owned, hired and non owned.
Your tools and equipment against theft, damage and loss.
The project under construction, plus materials on site.
A guarantee of performance or payment, not a transfer of risk.
Extra limits above your underlying policies once those are used up.
Claims from design work and advice, which general liability excludes.
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Tell us your trade, payroll and the states you work in. A licensed specialist will come back with real numbers.
