Thinking about the home improvements you’ll be making this fall? If you’ll be hiring contractors to help, make sure they’re properly insured. If not, you may end up footing the bill in the event of an accident or a renovation gone awry.
In many areas of the United States, sole proprietors are not required by law to have liability insurance or workman’s compensation insurance, which is why it’s important for consumers to obtain proof of insurance from their contractor before the start of any home improvement project. Brian Kearney, Owner of Neponset Valley Construction, says, "As long as a contractor has general liability insurance, workman's compensation, and the homeowner does not engage in gross negligence, then they will not be held accountable in the event of an injury or accidental damage.”
Homeowner’s insurance policies generally do not cover incidents involving uninsured and/or unlicensed contractors. Uninsured contractors also tend to be unfamiliar with building codes and are usually unable to apply for permits. When a project lacks the proper permit(s), a homeowner can be ordered to remove or repair the work that has already been completed. Alt=Home Improvements Tips
Kearney continues, “Regardless of the project’s size, it is very important to have a written contract that gives a clear scope of all work to be completed. Once a written agreement is signed, homeowners should request the contractor's insurance binder and follow up with the insurance company to make sure the policy covers each aspect of the project. Some contractors buy inexpensive policies that do not cover bigger projects. For an added layer of protection, clients can be asked to be added to the contractor’s policy as 'additionally insured'. Bottom line, a project should not begin until a written contract is signed and insurance is verified by the consumer .'"
Licensing agencies often maintain a guaranty fund and offer mediation services in case there is a dispute between one of their contractors and a consumer. Licensing agencies can also revoke a dishonest contractor’s license, which works to encourage honest hard work from licensed construction professionals. Unlicensed workers go in and out of business readily and can more easily avoid civil suits.
Make a note to yourself to check your contractor’s insurance before allowing them to begin any home remodeling project on your property.