"Contractors liability" is an essential form of insurance coverage that protects you and your team members, as well as your contracting business, from unexpected financial loss. In the unfortunate case where you are held responsible for damages that occur to a third party — such as an individual, or a building property — you would be required to cover the entire cost of the injuries and damages. Retaining contractors liability insurance will help you cover the cost of any such damages along with potential legal defense expenses too.