Subcontractor Insurance: Are You Covered for Today’s Digital Risks?

Subcontractor insurance used to be fairly straightforward: general liability, workers’ comp, maybe some equipment coverage. But as jobsite technology evolves—think drones, wearables, tablets, and cloud-based systems—so do the risks.

From cybersecurity threats to data breaches and drone damage, many subs don’t realize their old insurance policies may leave them exposed. Here’s what digital-era subcontractors need to know to stay protected.

New Tech, New Risk

Technology brings speed, precision, and accountability—but it also introduces new liabilities:

Drones: A misstep with a drone could lead to property damage, privacy complaints, or bodily injury.
Cyber threats: Cloud storage, online timesheets, and mobile apps can be hacked, exposing project data or payroll info.
Wearable tech: Sensors that monitor worker safety may collect personal health data—raising privacy questions.
Jobsite networks: Poorly secured Wi-Fi connections on job trailers or tablets could serve as entry points for cybercriminals.

Example in Action:

A mid-size mechanical subcontractor experienced a ransomware attack after an employee clicked a phishing link on a shared laptop. Project files, estimates, and financial records were locked. Their standard business insurance didn’t cover cyberattacks, and they had to pay out-of-pocket for recovery and remediation—over $30,000 in total losses.

What to Look For in Modern Coverage

Traditional insurance is still important, but here are a few digital-specific coverages subs should consider adding:

Cyber liability insurance: Covers data breaches, ransomware, digital forensics, and response costs.
Drone coverage: Many general liability policies exclude drone-related incidents—look for an endorsement or separate policy.
Technology E&O (Errors & Omissions): Covers losses related to failure of digital tools, misconfigurations, or data issues.
Wearables and sensor protection: Covers loss or misuse of data collected by tech devices on site.

Practical Considerations for Sub-Trades

You don’t need every add-on under the sun—but you should match your coverage to your digital footprint:

Audit your tech: Make a list of every connected device, app, or platform your team uses.
Talk to your broker: Many insurance pros don’t understand the construction tech space. Ask specific questions about exclusions and gaps.
Document digital protocols: Insurers may require basic cyber hygiene like multi-factor authentication or device encryption.

Another Real-World Example:

A framing crew used a drone to inspect roof truss work on a tight downtown site. When a wind gust forced the drone into a neighboring office window, their insurance denied the claim—citing an aviation exclusion. After that, the contractor added drone-specific coverage and updated their operating procedures to avoid another blind spot.

Practical Takeaways for Sub-Trades

Want to ensure your insurance keeps up with your technology? Start here:

Review your policy annually with a focus on tech-driven gaps.
Add cyber coverage if you rely on cloud tools, apps, or connected jobsite devices.
Include drone coverage if you fly for inspections, mapping, or marketing—even occasionally.
Train your crew: Avoiding basic cyber mistakes (like bad passwords or unsecured devices) is the best first defense.

Final Thoughts

Construction technology keeps moving forward—but insurance policies don’t update themselves. Sub-trades who stay ahead of digital risk will protect more than their devices—they’ll protect their reputation, operations, and bottom line.

Because in today’s construction world, coverage isn’t just about physical accidents anymore—it’s about digital ones, too.

*Brought to you by Plexxis Software: Offering software solutions for the construction industry that integrates cloud, mobile and on-premise software to improve and enhance team performance.