Which circumstance can lead to loss of insurance coverage for a contractor?

Not notifying the insurer about changes can lead to a loss of insurance coverage for a contractor because insurers rely on accurate and up-to-date information to assess risk. When a contractor makes changes to their operations, projects, or any relevant circumstances that affect their insurance policy, they are typically required to inform the insurer. This is crucial because if the nature of the work changes—such as taking on riskier projects or hiring additional employees—the risk profile of the contractor's business may also change. If these changes go unreported, the insurer may not properly evaluate the risk, and in the event of a claim, the contractor could find themselves without coverage.

The other options relate to aspects of project management and operations but do not directly influence the insurance coverage as significantly. Completing projects ahead of schedule may be seen positively by clients and does not affect coverage. Having a high Experience Modification Rate (EMR) indicates a contractor's past claims history but does not automatically lead to loss of coverage; instead, it may result in higher premiums. Operating without a bid bond pertains to the bidding process and doesn't have a direct impact on existing insurance policies. Thus, maintaining open communication and transparency with the insurer regarding any changes is vital to ensure continued coverage.