If you are thinking of tendering a government job, then make sure you have your insurance broker check the insurance specs. I find that the government contracts have the most requirements and almost always will necessitate changes or increases to the contractor's insurance program. For example, most government jobs will now insist you carry pollution liability insurance (guess they're trying to be politically correct re environmental protection). Also, they are very bull-headed re sticking to the contract's insurance specs even if they don't make sense. For example, their standard contract might read that you have to carry XCU (blasting, collapse, underpinning) cover which is not cheap. This makes sense if you do demolition or excavating. However, there is no common sense when dealing with government bureaucracy - I've called on cases like this to explain why the extra insurance isn't necessary for the job in question and the standard response is: "It's in the contract and the contractor signed it, so they have to provide it. If they don't, we'll hold them in breach of contract".
Some of them also have crazy Hold Harmless Agreements, whereby by signing the contract you also agree to take on liability that isn't your own. Sometimes insurance does not cover this, so if there's a claim, you have to pay yourself (which can potentially bankrupt a business if the liability claim is a big one).
It's true that the government jobs can be lucrative; especially now when a lot of "stimulus money" is available; just be very careful re what you might be signing up for.