[OSGeo-Discuss] Insurance for contractors?

[Michael P. Gerlek]

In the past I've hired some people for contract or consultant work (both open source projects and more general stuff) -- generally these people have been independent, one-man shops found by word of mouth and reputation, as opposed to hiring someone from an agency.

I'm getting pushback now from the administrative side of my company saying that any contractor I hire needs to have proof of insurance.  I understand the legal reasons for this, but I'm wondering how many of you out there actually have business/contractors insurance?  Do companies you work for insist on it, or not?  And how many of you are formally set up as LLCs or sole proprietorships or such?

[while this is likely a US-centric issue from the hiring side, I'm interested in international responses too since I've hired some foreigners as well over the years]

-mpg