Maryland has statutory insurance minimums for two specific categories of contractor: Master Plumbers and MHIC-licensed home-improvement contractors. The market (general contractors, commercial customers, larger residential customers, municipal permit offices) will require proof of coverage beyond minimums.
Minimum coverages a new Maryland trades shop should expect to carry:
- General liability. Maryland Master Plumbers must maintain at least $400,000 in coverage: $300,000 general liability and $100,000 property damage, written by a Maryland-approved carrier. Source: Maryland State Board of Plumbing License Requirements (https://labor.maryland.gov/license/pl/plreq.shtml). MHIC-licensed home-improvement contractors must maintain commercial general liability insurance per MHIC rules. $1M per occurrence / $2M aggregate is the typical commercial job requirement.
- Workers' compensation. Maryland is mandatory. Under Md. Code Ann., Labor and Employment §9-402, every Maryland employer with 1 or more employees must secure workers' compensation. Sole proprietors and single-member LLC owners may exclude themselves by filing the appropriate form with the Workers' Compensation Commission. Source: Maryland Workers' Compensation Commission (https://www.wcc.state.md.us/).
- Commercial auto. Your personal auto policy almost certainly excludes business use. Hired and non-owned auto coverage protects against claims arising from employee-owned vehicles used on company business.
- Tools and equipment (inland marine). Homeowners and auto policies exclude business tools beyond small dollar limits. Inland marine is the contractor-specific tool coverage.
- Professional liability (errors and omissions). Rarely needed for pure trades work but useful if you do design-build or estimating for others.
- Umbrella. A $1M or $2M umbrella is cheap relative to what it protects.
Shop the market. Trade association programs (ABC Greater Baltimore, ABC Chesapeake Shores, AGC Maryland, PHCC Maryland, IBEW/NECA-affiliated shops) often have group insurance programs that beat street-rate premiums for the trade. Chesapeake Employers Insurance Company (formerly IWIF) is a Maryland-focused workers' compensation carrier; quote against standard-market carriers.
Never let coverage lapse during an active job. A 1-day gap on a multi-month project is enough to void a claim if something happens during the gap.