# Wrap-Up vs. Project-Specific Liability vs. Annual Policies URL: https://mycontractorsinsurancequote.com/resources/ocip-ccip-vs-project-liability Updated: 2026-10-29 · Reviewed by the Principal, Gleason Insurance Brokers, LLC Publisher: My Contractors Insurance Quote, a website of Gleason Insurance Brokers, LLC A wrap-up insures the sponsor and enrolled trades under one program and makes sense on large, labor-heavy projects with a sponsor able to run it. A project-specific liability policy dedicates limits to one job for the named developer or GC while trades keep their own insurance, and annual practice policies with contract risk transfer remain the default for most smaller or routine work. ## Key Decision Points - Annual practice policies share one aggregate across all of a contractor's jobs; a project policy dedicates limits to one site. - A wrap goes further by insuring enrolled trades under the sponsor's program, but it adds enrollment and payroll administration. - Without a wrap, protection depends on indemnity clauses and additional insured endorsements, which state law can limit. - Project size, duration, trade count and lender requirements usually decide the structure. ## Three Ways to Insure the Liability on One Project Annual practice policies are each contractor's ongoing general liability and excess program. Every project the contractor works on draws from the same aggregate limits, and the owner and GC are protected through additional insured endorsements the trades are required to carry. This is the familiar structure, and it needs no special administration. A project-specific liability policy is written for one site, usually for the developer, the GC or both, with its own aggregate that other jobs cannot erode. Subcontractors keep their own annual policies and still provide additional insured endorsements and indemnity. A wrap-up goes one step further: the sponsor's program insures the enrolled trades too, so their on-site work is no longer handled by their own policies. Each step up in structure buys more control over limits and the completed-operations tail and costs more in administration and retained risk. The right choice is the least complicated structure that meets the contract, the lender and the project's actual exposure. Named insureds, per-project aggregates and excess attachment are explained in [how a project-specific liability policy is built](https://mycontractorsinsurancequote.com/project-specific-liability-insurance). ## When a Wrap Makes Sense A wrap tends to make sense when the project is large and long, the on-site payroll is heavy and many trades will be on the job at once. At that scale, buying one program can be more efficient than paying for every trade's insurance through its bid, and consistent limits for all enrolled parties reduce gaps between policies. It also needs a sponsor that can carry the retention and run the administration. If no one on the owner or GC side can manage enrollment, payroll reporting, certificates for excluded parties and claims for years after completion, the program's advantages erode quickly. Wraps are a weaker fit for short projects, projects dominated by suppliers and off-site fabrication and projects where a few trades perform most of the work. In those cases the enrollment effort covers too little of the actual exposure. Once a wrap is chosen, the next decision is [whether the owner or GC should sponsor](https://mycontractorsinsurancequote.com/wrap-up-insurance/ocip-vs-ccip). ### Illustrative scenario: Houston Tilt-Up Warehouse: Project Policy Instead of a Wrap A Houston developer building a single tilt-up distribution warehouse with a fixed-price GC and a short schedule weighs a CCIP against a project-specific liability policy. Most of the cost is in precast panels and steel fabricated off site, which a wrap would typically exclude, and only a handful of trades will be on site at once. The developer chooses a project policy naming itself and the GC, and its counsel rewrites the subcontract indemnity and additional insured terms to fit Texas Insurance Code §151.102 and §151.104 so the trades' endorsements respond as intended. ## When a Project-Specific Policy Is the Better Middle Ground A project-specific policy fits when the developer or GC wants dedicated limits and a defined completed-operations term but the job does not justify wrap administration. Lenders and equity partners often accept a project policy for the sponsor, with trades carrying their own coverage to stated limits. It is also useful for a GC whose annual aggregate is already committed to other jobs. Moving a large project to its own policy keeps that project's claims from eroding the limits available on the rest of the GC's work, and vice versa. The trade-off is that the trades' insurance still matters. A claim arising from a subcontractor's work may first test that subcontractor's annual policy, its additional insured endorsement and its indemnity clause, so certificate and endorsement review remains part of the job. The endorsement and indemnity side is covered in [how subcontractor risk transfer is documented](https://mycontractorsinsurancequote.com/resources/completed-operations-and-subcontractor-work). ## Texas Limits on Indemnity Change the Risk-Transfer Math Without a wrap, project protection leans on subcontract indemnity and additional insured endorsements. In Texas, Insurance Code §151.102 voids construction-contract provisions to the extent they require an indemnitor to indemnify, hold harmless or defend a party against a claim caused by the indemnitee's own negligence or fault, with stated exceptions. Section 151.103 preserves indemnity for claims of bodily injury or death of the indemnitor's own employees or those of its subcontractors. Section 151.104 applies the same limit to additional insured requirements, voiding them to the extent they would provide coverage broader than the permitted indemnity. The subchapter does not reach indemnity for a single-family house, townhouse, duplex or related land development, or for a municipal public works project, under §151.105. The practical effect is that a Texas owner or GC relying on annual policies or a project policy for itself may get narrower protection from trades' endorsements than the contract appears to promise. That narrower transfer is one reason some sponsors move to a wrap, where enrolled parties are insured directly under one program. How developers combine these tools is covered in our overview of [developer insurance and risk transfer](https://mycontractorsinsurancequote.com/who-we-serve/developers-subdividers). ## Where a Captive Fits Beside These Options A captive answers a different question from a wrap or a project-specific policy. Wraps and project policies insure one project; a captive finances a company's retained risk across all of its work. An established firm can use both, enrolling in an owner's wrap on a large job while its captive finances a layer of its ongoing liability, subject to a feasibility review and each program's terms. For when a captive may be worth studying, see our overview of [construction captive programs](https://mycontractorsinsurancequote.com/construction-captive-insurance-programs). ## California Residential Wraps and the Indemnity Trade-Off California moves the other way on residential wraps. Civil Code §2782.9 makes subcontract provisions unenforceable to the extent they require an enrolled participant on a residential wrap to indemnify or defend another for claims the wrap program covers. On those projects the sponsor is trading indemnity from the trades for direct coverage under its own program. That trade-off matters when comparing structures. On a California for-sale residential project insured with a project policy and annual practice policies, the builder relies on indemnity and endorsements; with a wrap, much of that indemnity falls away for covered claims and the program's limits and term become the main protection. Builders should size the wrap's completed-operations term with that in mind. Residential exposures are reviewed in more depth on [insurance for residential and multifamily projects](https://mycontractorsinsurancequote.com/projects/residential-construction). ## Before You Ask for a Quote ### What to Gather - Hard cost, schedule and the expected number of trades on site at once - Share of work performed off site or by suppliers - Owner-GC and subcontract insurance and indemnity provisions - Lender or investor insurance exhibits - GC's annual aggregate commitments on other active jobs ### What to Ask the Insurer or Surety - Would a project policy satisfy the lender's exhibit, or does it call for a wrap? - How much of the project's exposure would a wrap enroll? - What completed-operations term is available under each structure? - How do state indemnity limits affect the trades' additional insured endorsements? - Who would administer a wrap, and at what cost compared with a project policy? ## Broker Notes **Quick Answer:** Use annual practice policies for routine work, a project-specific policy when the sponsor needs dedicated limits and a wrap-up when a large, labor-heavy job justifies insuring every enrolled trade under one program. **Common Mistake:** Choosing a wrap for a short, supplier-heavy project where most of the exposure sits with excluded parties, which adds administration without reducing the risk-transfer workload. **Broker Perspective:** We map where the project's exposure sits, on site, off site or with suppliers, before recommending any structure. **Coverage Impact:** A project policy typically protects only its named insureds, while a wrap may insure enrolled trades directly; annual policies share limits across jobs, depending on the form and endorsements. ## Questions Buyers Ask ### Is a project-specific liability policy the same thing as a wrap-up? No. A project policy dedicates limits to one site for its named insureds, often just the developer or GC. A wrap enrolls the trades as insureds under the sponsor's program. With a project policy, subcontractors keep their own annual coverage and still owe endorsements and indemnity under their subcontracts. ### When is a project too small for a wrap-up? There is no fixed threshold, and carriers set their own minimums. A job tends to be too small when the administration and retained-loss exposure outweigh what the program saves, often on short schedules, projects with few trades on site or work dominated by off-site fabrication. A project policy or annual policies with strong risk transfer may fit better. ### Do Texas anti-indemnity rules apply if we use a project policy instead of a wrap? Generally, yes. Texas Insurance Code chapter 151, subchapter C, applies to construction contracts where the indemnitor provides or procures insurance subject to that chapter or Title 10 of the Insurance Code. Exceptions include single-family, townhouse and duplex work and municipal public works projects. Counsel should confirm how it applies to your contracts. ### Can a GC keep using its annual policy on a large project? Often, yes, if the contract allows it and the annual limits are adequate. The concern is aggregate erosion: a large claim on one project reduces limits available on every other job under that policy. Many GCs move large projects to a project-specific aggregate endorsement or a separate project policy for that reason. ## Official Sources 1. [Texas Insurance Code ch. 151, subch. C (§§151.101-151.105)](https://statutes.capitol.texas.gov/Docs/IN/htm/IN.151.htm), Texas Legislature. Applicability to construction contracts with insurance under ch. 151 or Title 10; voiding of indemnity for the indemnitee's negligence; employee-injury exception; additional insured limits; single-family and municipal public works exclusions Verified 2026-10-23. 2. [Cal. Civil Code §2782.9 (residential wrap-ups and indemnity)](https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV§ionNum=2782.9), California Legislative Information. Indemnity provisions requiring enrolled participants to indemnify or defend for claims covered by a residential wrap are unenforceable Verified 2026-10-23. ## Related Decisions - [captive, large deductible or self-insured retention](https://mycontractorsinsurancequote.com/resources/captive-vs-large-deductible) - [how wrap-up insurance works](https://mycontractorsinsurancequote.com/wrap-up-insurance) - [project-specific general liability](https://mycontractorsinsurancequote.com/project-specific-liability-insurance) - [OCIP or CCIP](https://mycontractorsinsurancequote.com/wrap-up-insurance/ocip-vs-ccip) - [what lenders require](https://mycontractorsinsurancequote.com/resources/lender-insurance-requirements) - [project-specific liability premium drivers](https://mycontractorsinsurancequote.com/project-specific-liability-insurance/cost) --- Start a quote request: https://mycontractorsinsurancequote.com/get-a-quote · Call 844-978-7283 Contract and insurance reviews are a courtesy service that may be available at times, depending on our workload and on the size, timing and complexity of the project. A review is not guaranteed and is limited to insurance considerations. It is not legal advice and is not a substitute for advice from your own legal counsel, which you may need before signing a contract or obtaining coverage. Insurance and surety services are provided through Gleason Insurance Brokers, LLC. Site information is educational and does not constitute legal advice, a binder, an offer of coverage, a guarantee of eligibility or confirmation of policy terms. Insurance conditions are governed by actual issued policies; surety rights and obligations are governed by bond and indemnity documents.