I'll agree, hydroseeding might be considered low risk, and your assumption just shows what many dont know getting into a business situation. Even being a low risk as far as personal dangers, it is not without financial risk. Environmental mistakes can bankrupt you just as fast as dropping a tree on someones house.
General Liability insurance isnt all that expensive, especially when you factor in what it might cost you to rebuild someones house if you destroy it by dropping a tree into it. I think the million dollar policy I had cost about $600 per year. Workers comp is based on number of employees and the type of work you are doing. Tree work employees will cost you more than my hydroseeding employees would. With workers comp, you also need to be prepared to be audited pretty regular. I made the mistake of hiring a guy just to till up some old pasture that was being converted into a lawn. I paid him $100 for a couple of hours work. When I was audited, the auditors wanted a copy of his workers comp coverage. Of course he didnt have any and I ended up paying for his coverage for a full year. IIRC, It cost me about $300 just for his coverage for one year for a couple of hrs work. Needless to say, I lost money on that hydroseeding job because of it. From that point on, whenever I hired a sub for anything, I paid them for straw and not wages. That one issue changed my way of thinking about running a legit business. Old Uncle Sam has figured out a way to get more of your money than you get to keep.
Now you know why legal contractors will ask for a copy of your insurance policy. If you sub work from them, they are responsible to make sure you have coverage, even if it means they have to provide it for you. It should also explain why legit companies have to charge more that someone that isnt legit. It should also give you some ideal of why a legitimate business will hire someone with insurance before they hire someone without. Usually, its just cheaper, and certainly a lot less paperwork, to hire someone that already has their own coverage, even if that someones prices might be a tad higher. I know from experience how hard it is to bid bigger jobs and act as a sub contractor to the General contractor. If you dont have the coverage, they wont fool with you. I also know now, even tho I might not have been aware of it back then, just how much risk I was taking by not having insurance. Homeowners dont know and dont understand, they just look for low prices, they dont have a clue as to the liability they open themselfs up to if the person they hire screws up.
