Updated: December 2025

Quick Ontario snapshot — $2M CGL monthly anchor and RST mathAs of December 2025 • Need proof fast? Get a quote →

Illustrative invoice preview (Ontario, $2M CGL)

Item	Amount
Premium + admin (subject to 8% RST)	$610.00
Ontario RST (8%)	$48.80
Illustrative annual total	$658.80 (≈ $54.90/mo)

$2M CGL snapshot (Ontario)	Pre-tax	With 8% RST
Monthly from	$38	$41
Annual from	$450	$486

Notes:

Figures are illustrative starting points for low-risk trades; actual premiums vary by trade, revenue, subs, and claims.
Ontario applies 8% RST to insurance premiums; HST/GST do not apply to the premium.

Context for Ontario contractors in 2025

Ontario buyers typically request proof of Commercial General Liability (CGL) at $2M–$5M when awarding work. Costs vary by trade risk, revenues, claims, and subcontractor use. The itemized example and ranges below are Ontario‑specific and include provincially applicable tax.

What contractor CGL covers and common limits

Core protections: third‑party bodily injury, third‑party property damage, personal/advertising injury, defence costs.
Typical limits purchased in Ontario: $1M–$5M per occurrence; $2M is a common requirement on small‑to‑mid projects.
Related coverages contractors often add: tools/equipment, installation floater, commercial auto, umbrella/excess, pollution, and builders risk. See Contractors Insurance and CGL for product scope.

2025 price snapshot: $2M CGL monthly/annual ranges in Ontario

Pricing below reflects standalone CGL for small trade contractors with clean loss history; bundling additional coverages will increase totals.

Entry‑level trades (e.g., handyman, painters): starting around $450–$600 per year ($38–$50/mo).
Typical light construction/renovation (e.g., carpentry, residential reno): about $450–$1,000 per year ($38–$85/mo).
Higher‑risk trades (e.g., roofing, demolition): commonly $100–$200+ per month for $2M CGL. Note: Different brokers publish different starting points (e.g., $425–$550/yr for $2M), reflecting carrier appetite and underwriting.

Ontario taxes on contractor CGL (how it appears on invoices)

Insurance premiums in Ontario attract 8% Retail Sales Tax (RST). HST/GST does not apply to insurance premiums.
RST applies to the premium and certain administration amounts that form part of the premium; reasonable financing fees are not subject to RST if shown separately.
Some separately billed services may be subject to HST if they are taxable (e.g., consulting/risk‑management services). “Arranging for” insurance by a licensed broker is an exempt financial service.

$2M contractor CGL in Ontario — illustrative 2025 invoice (annual and monthly)

The following example demonstrates calculation mechanics for a small residential contractor with clean history. Values are illustrative only.

Line item	Amount (CAD)
Base premium (CGL $2,000,000)	$560.00
Policy/administration fee (part of premium)	$50.00
Subtotal premium subject to 8% RST	$610.00
Ontario RST (8% of $610.00)	$48.80
Total annual cost	$658.80
Optional: 12 instalments (no financing charge)	$54.90/mo
Optional: Premium financing fee ($3.00/mo; not subject to RST if shown separately)	+$3.00
Illustrative financed monthly total	$57.90/mo

Why the tax lines look this way: Ontario continues to levy 8% RST on most insurance premiums (including property and liability). HST does not apply to the insurance premium itself; if a separate fee is HST‑taxable, that portion is not subject to RST. Financing charges shown separately are not RST‑taxable.

What changes the price most

Underwriters in Ontario typically weight:

Trade risk profile (e.g., interior finish vs. roofing/demolition), and scope of operations.
Annual and projected revenues; number of employees/subcontractors; jobsite types.
Claims history and risk controls (contracts, certificates from subs, hot‑work protocols, WSIB where applicable).
Limit requirements ($2M vs. $5M) and additional insureds.

Is $2M CGL required by Ontario law?

There is no blanket statutory requirement for all contractors to carry CGL; however, municipalities, GCs, and owners routinely make $2M a contract condition, and many projects won’t proceed without proof of insurance.

What Summit needs to quote fast

Have these ready for a rapid, accurate Ontario quote:

Legal entity details, operations description, service radius, and years in business.
Gross revenues (actual and projected), payroll, and subcontracting split.
Prior insurance and 5‑year claims history.
Required limits, additional insureds, and certificate wording. Summit is an independent Canadian brokerage that compares carriers and discloses how we’re compensated. See How We Get Paid.

Related coverages Ontario contractors often bundle

Key takeaways for 2025

Many Ontario contractors can secure $2M CGL starting in the ~$450–$600/yr range; higher‑risk trades trend higher.
Ontario applies 8% RST to insurance premiums; HST/GST do not apply to the premium; financing fees are not RST‑taxable when shown separately.
An itemized invoice should clearly separate premium, tax, and any non‑premium fees for transparency and compliance.