How to read the insurance clause in a BC tender

The insurance section is one of the shortest parts of a tender and one of the easiest to get wrong. A missing endorsement or a limit that's $1 million short can stop a contract from being signed, or lose you the award to the next bidder. Here's how to read it.

Where is the insurance clause?

Usually in the contract terms, not the instructions to bidders. Look for a section called "Insurance", "Indemnity and insurance" or similar, often near the end, and in any form of agreement attached to the tender. Some tenders also have a form for your broker to fill in.

What does each part mean?

Commercial general liability (CGL)

Covers injury to other people and damage to their property caused by your work. The clause states a limit per occurrence, and sometimes an aggregate limit for the policy year. On BC municipal service contracts, $2 million and $5 million per occurrence are both common. The City of Coquitlam's 2025 snow removal RFP asked for $5 million.

Additional insured

The buyer wants to be added to your CGL policy as an additional insured, so that if they're sued over your work, your policy responds for them too. Your broker adds this with an endorsement. It's routine, but it has to be done.

Cross liability or severability of interest

Means the policy treats each insured as if they had a separate policy, so the buyer can claim against it even though they're also named on it. Most commercial policies include this; check yours.

Notice of cancellation

The buyer wants written notice, often 30 days, before your policy is cancelled or materially changed. Some insurers limit what notice they'll give, so ask your broker what your policy actually says.

Automobile liability

If you drive to the site or use vehicles on the work, expect a requirement for third-party liability on your vehicles, often at a stated limit. In BC that's through ICBC and any excess coverage. Equipment may need its own coverage: Prince George's 2026–2027 snow retainer, for example, asks for ICBC third-party liability of $3 million on each dozer and $5 million on each grader.

Other coverage you might see

• Professional liability (errors and omissions), for design, consulting, inspection or IT work.
• Pollution liability, for some environmental, septic, asbestos or fuel-related work.
• Property or equipment coverage, for your own tools and machines, sometimes required so the buyer isn't asked to cover them.
• Umbrella or excess liability, a cheaper way to reach a high CGL limit on top of a base policy.

When do I have to prove it?

Usually after award and before you start, with a certificate of insurance or the buyer's own insurance form signed by your broker. Some tenders ask for proof with the bid, or a letter from your broker saying they'll provide it if you win. Read the instructions; if proof is a mandatory part of the bid, a missing letter can disqualify you.

What should I send my broker?

Send the whole insurance clause, the buyer's legal name, the contract term and a short description of the work, and ask:

1. Does my current policy meet every requirement?
2. What would it cost to raise any limit that's short, for the whole contract term?
3. Can you add the buyer as additional insured and give the notice they want?
4. How long will the certificate take?

Do this when you decide to bid, not after you win. Raising a limit can take days, and the cost belongs in your price.

Can I ask the buyer to change the requirement?

You can ask, during the question period, whether a lower limit would be accepted. Buyers sometimes agree, especially when the limit looks like a template default on low-risk work, and the answer goes to everyone as an addendum. Don't just bid with a lower limit and hope: that's a common way to be found non-compliant.

Where to go next

See the paperwork BC public buyers ask for for WorkSafeBC, COR and bonds, and how to read a tender for building a checklist of everything a bid needs.