Overhead and profit (“O&P”) is the standard compensation for a general contractor’s role in a multi-trade project: supervision, scheduling, subcontractor management, insurance, office and project administration, and accountability for the finished result. It is commonly expressed as 10% overhead and 10% profit and typically applies when a project genuinely requires multiple trades coordinated by one responsible contractor.
What Overhead Actually Covers
Project supervision, scheduling and sequencing of trades, material procurement and logistics, insurance and licensing costs, office administration, warranties, and the overhead of standing behind the completed work.
When O&P Typically Applies
Restoration losses involving several trades — roofing, drywall, paint, flooring, electrical, plumbing, HVAC — require coordination a single trade doesn’t provide. One accountable general contractor manages sequence, quality, and completion. Single-trade repairs generally don’t involve GC-level coordination.
A Construction Perspective, Not a Coverage Opinion
Whether O&P is included in any particular claim settlement is determined by the owner and carrier under the policy. APGC’s role is explaining and documenting the coordination the project actually requires. See reconstruction and build-back and construction documentation.
Frequently Asked Questions
Is O&P an extra charge the contractor adds on?
It’s the standard market compensation for general-contractor coordination on multi-trade work — comparable to how any GC-run construction project is priced.
Does every roof job include O&P?
Generally no. A single-trade roof replacement usually doesn’t require GC-level multi-trade coordination. Losses touching interior trades, structure, and exterior systems usually do.
Who decides if O&P is paid on my claim?
That’s between you and your carrier under your policy. APGC documents the trades and coordination the reconstruction actually requires.