Arizona contractor insurance requirements

Workers' comp in Arizona

Any employer that regularly hires workers in its usual business must carry workers' comp, no matter how many, including part-time workers. A sole proprietor with no employees doesn't need to insure only themselves.

The agency in charge is the Industrial Commission of Arizona. It can tell you whether a specific business needs coverage, and most states let you look up an employer's policy online.

Contractor licensing and insurance

We found no statewide general liability minimum tied to a general contractor license. Arizona's Registrar of Contractors requires a license bond. Cities and counties can set their own licensing and insurance rules, so check where the project is.

Indemnity and additional insured clauses

Arizona has anti-indemnity statutes for public contracts (Ariz. Rev. Stat. §§ 34-226 and 41-2586) and private construction contracts (§§ 32-1159 and 32-1159.01). They void clauses that make a contractor indemnify another party for that party's sole negligence, and the private-contract rules reach further. Some commentators read the statute as also voiding additional insured coverage for the other party's sole negligence.

What to check on a contractor COI for a Arizona project

1. Workers' comp. Nearly every contractor with employees needs it in Arizona. A contractor with a crew and no workers' comp on its COI is a gap. For an out-of-state contractor, confirm Arizona is listed on the workers' comp policy.
2. General liability. Arizona doesn't set a statewide floor for a general contractor license, so your project requirements set the bar. Compare each limit on the COI with what the contract asks for.
3. Additional insured. The endorsement is a separate promise from the indemnity clause, so check both. Ask for the endorsement itself, not just a box ticked on the certificate.
4. Dates. Every policy should run through the end of the job. A COI only shows coverage on the day it was issued, so check again at each renewal.

Forsured checks every contractor COI against your project requirements, then keeps checking for the life of the project. Send us one project's requirements and a contractor COI or two for a free COI risk check.