Insurance in Michigan

Michigan does not set a statewide general liability (GL) insurance floor to issue a Residential Builder or Maintenance & Alteration Contractor (M&AC) license. The LARA Bureau of Construction Codes (BCC) administers Article 24 of the Occupational Code (1980 PA 299), and evidence of GL insurance is usually surfaced at the municipal permit desk or by a customer, not at the state application window. That does not mean you can skip it. Most cities require proof of GL before pulling a permit, and most general contractors require a certificate of insurance naming them as additional insured before you step on site. Workers' compensation is where Michigan has a firm statutory rule. The Workers' Disability Compensation Act (1969 PA 317, MCL 418.101 et seq.) is administered by the Workers' Disability Compensation Agency (WDCA) inside the Department of Labor and Economic Opportunity. The coverage trigger is in MCL 418.115: - A private employer (other than agricultural) that regularly employs 3 or more employees at one time is covered and must carry workers' comp. - A private employer with fewer than 3 employees is still covered if at least 1 employee has worked 35 or more hours per week for 13 weeks or longer during the preceding 52 weeks. MCL 418.171 adds a principal-contractor backstop. If a principal contracts with a sub who is subject to the Act but has not complied with the coverage requirement, the principal can be held liable for the sub's workers' comp obligations. That is why Michigan GCs collect current certificates from every sub on site. Sole proprietors, partners, and certain corporate officers and LLC members can file exclusion paperwork with WDCA. The moment the entity employs someone who is not the principal, exclusion stops mattering. The employee has to be covered from day one. Other coverages to carry: - Commercial auto for trucks and vans used in the business. Michigan personal auto policies carve out commercial use, and Michigan's no-fault regime makes an uncovered business claim especially painful. - Hired and non-owned auto for employees driving their own vehicles on company business. - Inland marine (contractor's tools and equipment) for gear kept on the job site or in the truck. - Pollution liability for refrigerants, solvents, and fuel handling. Relevant for mechanical, HVAC, and underground work. - Umbrella of $1M–$2M over the underlying GL. Cheap relative to the exposure. - Employment practices liability (EPLI) once employee count reaches double digits. Shop the market annually. Association programs through ABC of Michigan, AGC of Michigan, HBAM, MPMCA, and MIEC often beat street rates for the same policy form. Whatever GL limit you land on, keep the certificate current with every city you permit in. The permit desk, not LARA, is where the paperwork check happens.