Subcontractor prequalification, explained

The packet: six documents and what each proves

A standard prequalification packet for a commercial sub:

• W-9 — the legal entity and taxpayer ID you'll actually be paying. Catches name mismatches between the bid, the contract and the bank account. Check: signed, classification marked, name matches the contract entity.
• Trade/contractor licenses — the state or locality's permission to do the work at all. Check: right classification for the scope, active, not expiring mid-project.
• Certificate of insurance (ACORD 25) with endorsement pages — evidence of GL, auto, workers' comp and umbrella at the limits your subcontract demands, plus the endorsements (additional insured CG 20 10/20 37, waiver of subrogation, primary & non-contributory) that make their policy respond before yours.
• OSHA Form 300A — the sub's own summary of last year's recordable injuries. From its counts and hours you compute TRIR and DART, the comparable safety rates.
• EMR letter — the workers' comp experience modification rate, verified by their carrier or agent. 1.00 is average; many GCs cap acceptable subs at 1.00 (sometimes 1.25 with mitigation).
• Financial statement — capacity to carry payroll and materials between draws. Usually reviewed once and held in confidence.

Safety numbers: EMR, TRIR and DART in one paragraph each

EMR (experience modification rate) is the insurance industry's score of a company's workers' comp claims against payroll-adjusted expectations. 1.00 is exactly average for their trade and size; below is better. Because it directly multiplies their workers' comp premium, it's audited data — which is why GCs ask for a carrier letter, not a self-reported number.

TRIR (total recordable incident rate) is OSHA recordables normalized to a 100-employee year: recordable cases × 200,000 ÷ hours worked. It comes straight off the 300A. Construction averages sit around 2.2–2.3 in the most recent BLS data; single-digit crews swing wildly year to year, so read small subs' TRIR with context.

DART counts only the serious subset — cases with days away, restriction or transfer — normalized the same way. A low TRIR with a high DART share means fewer but worse incidents.

Who pays for prequalification — the ISNetworld question

Enterprise owners solved packet-chasing by pushing it onto networks like ISNetworld, Avetta and Veriforce — where each contractor pays an annual membership (roughly $1,000 to several thousand dollars per year per network as of mid-2026, sized by company headcount) to maintain a profile the hiring client reads. At owner scale that trade can make sense. For a GC's own sub list, it mostly means good small subs pay to bid, or quietly decline.

The GC-paid alternative: collect the packet yourself with software that gives every sub a free, no-login upload link, reads each document automatically (license expiry, TRIR/DART from the 300A, EMR against your cap, endorsements on the COI), and chases what's missing. That's what CoverWarden's Prequal plan does — subs never pay, and the packet's status is one dashboard.

Where prequalification breaks down

Three predictable failure points: documents that expire mid-project with nobody watching (licenses, COIs); documents that arrive but never get read past page one (the endorsement gap, the unsigned W-9); and annual refreshes that simply don't happen because the collection cost lands on whoever's busiest. All three are chasing-and-reading problems — exactly what software automates.

Frequently asked questions