What happens if your contractor liability insurance lapses in Maryland?

Work it through

You're the contractor. Pick what you'd do, then see how each choice plays out.

1. ADo NOT start the job Monday. Reinstate your insurance immediately — you cannot legally operate without the required $50,000 liability coverage
   Correct

   Maryland Business Regulation §8-303 requires MHIC-licensed contractors to maintain at least $50,000 in general liability insurance at all times. Operating without insurance is grounds for license suspension. If someone is injured on a job while you're uninsured, you're personally liable for all damages with no policy to cover you. Fix the payment and reinstate before touching any job site.

2. BStart the job anyway — it's a small project and you'll reinstate the insurance next week
   Wrong

   There is no grace period for insurance lapses under MHIC requirements. Every day you operate without $50,000 liability coverage, you're in violation. If a worker is injured or property is damaged on Monday, you're personally liable for every dollar. One slip-and-fall can bankrupt you. The MHIC can also suspend your license retroactive to the lapse date.

3. CCall the client and push the start date back a week. Tell them you have a scheduling conflict
   Right priority, wrong excuse

   Not starting until your insurance is reinstated is the right call, but inventing a scheduling conflict is a lie to your client. You can delay honestly: tell them an administrative issue needs a week to clear. Get the insurance reinstated as fast as possible, and check whether your lapse triggers an MHIC notification. Some insurance companies are required to notify the Commission of policy cancellations.