Insurance Secrets Most Agents Won’t Tell Startup Contractors
What You Don’t Know Will Hurt You
If you're just getting started as a contractor, there's a lot you haven’t been told. Not because you’re not smart — but because most insurance agents don’t want you asking the hard questions.
Here are 10 insider truths about contractor insurance that almost no agent will say out loud — but every startup needs to hear.
1. “Independent” Doesn’t Always Mean Independent
Myth: “Any independent agent can shop all the carriers.”
Reality: Agencies only have contracts with certain companies — and they need to hit quotas. That means you may get placed with who’ll take you, not who’s best for you.
Takeaway: You need an agent with access to companies that actually want startup contractors.
2. A “Cheaper” Quote Usually Means Something Got Cut
Truth: Some agents hit your budget by quietly stripping important coverage — like no subcontractors, no tools, or low limits.
Takeaway: If it looks too cheap, ask: “What’s missing from this quote?”
3. Insurance Companies Share Everything
Switching carriers every year? Running low limits? Paying late? It all shows up in the system — and it affects your pricing for years.
Takeaway: You’re building an insurance track record from day one — treat it like your business credit score.
4. The Best Deals Go to Proven Contractors — and Trusted Agents
Insurers want stability. They want clean books. They want agents who don’t bring them headaches.
Takeaway: A strong setup + a reputable agent = better pricing and access. (Even if you’re a startup.)
5. Big Agencies Don’t Want Small Accounts
If your premium is under $15K, big agencies often toss you to junior reps. You get data entry, not strategy.
Takeaway: Choose someone who specializes in startup contractors — not someone who sees you as small change.
6. Claims Reputation Matters More Than Price
Some insurance companies delay, deny, or lowball every claim. Others pay fast and fair. Agents know who’s who — they just don’t always tell you.
Takeaway: Ask your agent: “How does this company actually treat contractors when there’s a claim?”
7. If You Don’t Ask, They Won’t Explain
Act like you only care about “cheapest”? That’s all most agents will give you.
Takeaway: Show interest. Push for options. A good agent will rise to meet you.
8. Meeting GC or State Requirements ≠ Real Protection
Just because your policy meets jobsite or legal requirements doesn’t mean it protects you. Sub exclusions, weak limits, or stripped-down policies leave you exposed.
Takeaway: Don’t settle for “just enough” to be legal. Protect your business.
9. Most Agents Prefer That You Stay in the Dark
If you don’t know what questions to ask, agents can get away with less work — and fewer explanations.
Takeaway: You don’t need to be an expert — just informed enough to spot when someone isn’t doing their job.
10. Default Programs Are a Trap
Work comp through the state fund? Default limits from a “standard” quote? That’s what happens when no one helps you do better.
Takeaway: The default path is usually the most expensive long term — and the hardest to grow out of.
Quick Win: 5 Questions to Email Your Agent Today
Which insurance companies actually want to work with new contractors like me?
What coverage was removed or limited to make this quote look cheaper?
What does my insurance record look like to other companies?
Who actually handles my account — you, or someone else?
If you were starting a contracting business, which insurer would you choose — and why?
Why I Care
I’ve spent 25 years watching good contractors get stuck in bad setups — all because no one told them the truth.
I’m not here to play the same game. I’m here to help you beat it.
Bottom line: Insurance is full of hidden traps. But the more you know, the less you get played — and the stronger your business becomes.
