If you’re a contractor trying to figure out what you should be paying for insurance — or whether you’re getting a fair rate — you’re not alone. Insurance costs are one of the most common questions we hear from plumbers, electricians, roofers, and general contractors across Texas.
The good news: independent data now exists to answer this question with real numbers. Here’s what the research actually shows.
GL premiums rose 5–15% in 2025
General liability insurance remains the most fundamental coverage for contractors. According to 2025 contractor insurance requirement data, GL premium rates are trending upward with increases ranging from 5% to 15% this year.
The standard minimum coverage requirement that clients and licensing boards expect remains $1 million per occurrence / $2 million aggregate.
For most small contractors — a solo plumber, a two-person electrical crew, a handyman — that works out to roughly $400–$900 per year for a basic GL policy depending on your trade and payroll.
The CIAB Q4 2025 report: construction premiums actually softened
The Council of Insurance Agents & Brokers (CIAB) — one of the most respected independent benchmarks in the industry — released its Q4 2025 commercial insurance survey in February 2026. The finding that surprised a lot of people: construction premiums decreased in Q4 2025, part of a broader softening across nine lines of business.
That’s meaningful for contractors. It means the GL market has some capacity right now — if you’re shopping policies or renewing, you may have more negotiating room than you did in 2023 or 2024.
The exception: commercial auto premiums increased 6.6% in Q4 2025 — the 58th consecutive quarterly increase for that line. If you have vehicles on the policy, expect that piece to keep going up.
Umbrella/excess is where contractors are getting hit hardest
The CIAB’s Q3 2024 report showed commercial umbrella and excess liability experienced an 8.6% rate increase — the steepest of any line. The driver is social inflation: nuclear verdicts (jury awards above $10 million) have become more common, and insurers are responding by tightening capacity and raising rates on umbrella policies.
According to WTW’s Insurance Marketplace Realities 2025 Spring Update, contractors should expect increased underwriting scrutiny — especially around auto, driver protocols, and excess liability. Carriers are managing aggregate limits carefully and preferring shorter policy terms.
Workers’ comp: flat to 5% increases, but classification matters more than ever
Workers’ compensation is seeing some of the most stable pricing — premium increases are running flat to 5% in 2025 for most contractors. But classification accuracy is under a microscope.
The CIAB data confirms workers’ comp is one of the lines showing premium decreases in Q4 2025 — a favorable trend for contractors who have clean loss histories and properly classified workers.
One critical watch item: the DOL independent contractor classification rule is in flux. The Department of Labor proposed rescinding its 2024 rule in early 2026 and reverting to a simpler “core factor” framework for determining whether a worker is an employee or independent contractor. As of May 2025, the Wage and Hour Division stopped using the 2024 rule in investigations. Read the full DOL NPRM summary here.
Why does this matter for insurance? Because how your workers are classified determines whether you need workers’ comp on them. Misclassify a worker as a 1099 sub when they’re actually functioning as an employee — and you could face a workers’ comp audit with a surprise premium bill, or worse, an uninsured claim.
The contractor insurance market is growing — and so is client demand for proof of insurance
According to Research & Markets, the global contractors insurance market grew from $40 billion in 2023 to $44 billion in 2024, and is projected to reach $78 billion by 2030. The domestic market tells a similar story: more contractors are being required to carry insurance as a condition of getting work.
Clients — from homeowners to general contractors to commercial property managers — increasingly require a certificate of insurance (COI) before any work begins. Getting turned down for a job because you can’t produce a COI is a fast way to lose revenue you could have had.
What this means for Texas contractors
Here’s the practical takeaway from all this data:
- GL rates are stable to slightly up — budget 5–10% more than last year if renewing
- Umbrella/excess is getting more expensive — if you’re doing larger jobs, price this carefully
- Auto is still climbing — 6.6% up in Q4 2025, 58 consecutive increases
- Workers’ comp is favorable right now — good time to shop if you haven’t recently
- Worker classification is a live risk — don’t assume 1099 subs are always off your WC policy
If you’re a contractor in Texas and want to compare your current rates against what the market is actually doing, get a fast GL quote here — most contractors can get bindable pricing online in under 5 minutes through carriers like Thimble and NEXT Insurance.
Sources: CIAB Commercial P/C Market Survey Q4 2025 and Q3 2024; WTW Insurance Marketplace Realities 2025 Spring Update — Construction; DOL NPRM on Independent Contractor Classification (Feb 2026); Research & Markets Contractors Insurance Market Forecast 2025–2030.