CSLB Contractor's Law & Business Practice Exam

What method should the prime contractor use to confirm a subcontractor has workers' compensation insurance?

1. Check the subcontractor's financial statements

2. Observe their job site safety practices

3. Ask to see the expiration date on their certificate of insurance

4. Rely on the subcontractor's word

The correct answer is: Ask to see the expiration date on their certificate of insurance

The best method for a prime contractor to confirm that a subcontractor has workers' compensation insurance is to ask to see the expiration date on their certificate of insurance. The certificate of insurance is a document that provides proof of insurance coverage, including details about the types of coverage, policy limits, and effective dates. By reviewing the expiration date, the prime contractor can ensure that the insurance is current and will remain in effect for the duration of the project, thereby protecting both parties from potential liabilities in the event of workplace injuries. Requesting actual documentation is a prudent practice that mitigates risks associated with noncompliance and helps ensure that all parties involved in the project are adequately covered for any work-related incidents.