This might be the most misused and misunderstood phrase in the General contracting business. It is as wrong as describing a circle as a square. 1099 is an IRS form that you are required to issue to people or companies that are NOT employees you pay money to during the tax year. These are parties that technically operate their own business.
They are not W-2 employees of the business and require their own insurance. The legal definition of an actual 1099 party can be found HERE. The truth be told, most people classified as 1099 by contractors should not be. They do this to try and get around Worker’s Compensation laws and avoid paying taxes that would be required if they were treated as employees.
Learn more about insurance for independent contractors.