Workers' Comp vs. General Liability
for California Contractors (2026)
Both are required by CSLB — but they cover completely different risks. Here's exactly what each policy covers, what it costs by trade, and why you cannot substitute one for the other.
The Core Difference
Workers' Comp covers:
Injuries to your own employees while working. Medical bills, lost wages, disability, and death benefits.
- Employee falls off a roof → WC pays their medical bills
- Employee cuts hand on a saw → WC covers lost wages
- Employee develops occupational illness → WC covers treatment
General Liability covers:
Injuries or damage to third parties (clients, public, other contractors) caused by your work.
- Client trips over your tools → GL pays their medical bills
- You damage a client's property → GL covers repairs
- Completed work causes damage → GL covers the claim
⚠️ Important: Neither policy substitutes for the other.
WC does not cover third-party claims. GL does not cover employee injuries. CSLB requires both for licensed contractors with employees.
Full Coverage Comparison
| Coverage | Workers' Comp | General Liability |
|---|---|---|
| Covers employee injuries on the job | ✅ Yes | ❌ No |
| Covers employee medical bills | ✅ Yes | ❌ No |
| Covers employee lost wages | ✅ Yes | ❌ No |
| Covers employee disability/death benefits | ✅ Yes | ❌ No |
| Covers third-party bodily injury | ❌ No | ✅ Yes |
| Covers third-party property damage | ❌ No | ✅ Yes |
| Covers completed operations claims | ❌ No | ✅ Yes |
| Covers personal & advertising injury | ❌ No | ✅ Yes |
| Required by CA Labor Code §3700 | ✅ Yes | ❌ No |
| Required by CSLB for license | ✅ Yes | ✅ Yes |
| Ghost policy option available | ✅ Yes | ❌ No |
| Covers subcontractor injuries | Depends on policy | ❌ No |
2026 Cost Comparison by Trade
WC is typically 3-5x more expensive than GL because it covers higher-frequency, higher-cost claims.
| Trade | WC Annual Cost | GL Annual Cost |
|---|---|---|
| Roofers (C-39) | $8,000–$25,000+/yr | $1,800–Varies |
| Electricians (C-10) | $3,500–Varies | $900–Varies |
| Plumbers (C-36) | $4,000–Varies | $1,200–Varies |
| HVAC (C-20) | $3,800–Varies | $1,000–Varies |
| General Contractors (B) | $5,000–$20,000+/yr | $1,500–Varies |
| Painters (C-33) | $2,500–Varies | $700–Varies |
WC rates per $100 payroll. GL rates for $1M/$2M limits. Subject to underwriting.
Frequently Asked Questions
Do California contractors need both workers' comp and general liability?
Yes. CSLB requires both. Workers' comp is required under California Labor Code Section 3700 for any contractor with employees. General liability is required to obtain and maintain a CSLB license. They cover completely different risks and neither substitutes for the other.
What does workers' comp cover that GL does not?
Workers' comp covers your own employees' medical bills, lost wages, and disability benefits if they are injured on the job. GL does not cover employee injuries at all — it only covers third-party (client or public) injuries and property damage.
What does general liability cover that workers' comp does not?
General liability covers third-party bodily injury and property damage claims — for example, if a client trips over your equipment or you accidentally damage a client's property. WC does not cover these third-party claims.
Can I get a ghost policy instead of workers' comp in California?
Sole proprietors and single-member LLCs with no employees may qualify for a ghost policy (owner-exclusion WC policy) to satisfy CSLB's workers' comp requirement. SB 216 (effective 2025) requires specific trades to carry active WC regardless of employee count. Contact us to determine if a ghost policy is right for your license class.
Get Both Coverages in One Call
We quote WC and GL together and bundle them for the best combined rate. COI processing.
Also see: Workers' Comp · General Liability · Ghost Policy Guide