Are Your Worker Insured?

As a handyman and remodeling general contractor, we carry $1M/$2M general liability insurance to protect our customers and ourselves from unforeseen problems. So, every time we bid a job, this insurance cost is included in the price we charge for our services. In addition, if the job we are bidding requires a license, we only hire licensed sub-contractors to perform that work.

On many occasions, we are competing with workmen that are not licensed, have no insurance and are not qualified to perform the job at hand. Customers assume everyone is "required" to be licensed and have insurance, but the truth is, there are licensing laws, but there is no law requiring insurance. In fact, when a customer hires an unlicensed and/or uninsured contractor to perform work on their home, they are taking the risk of damage to their home, and more importantly, the risk of injury to the contractor and his/her workers. They also take the risk of damage these contractors may do to their property and the property of others.

Hazards of Hiring an Unlicensed and/or Uninsured Contractor

While licensing isn't necessarily a measure of competence, it does imply a certain level of professionalism and suggests that the contractor is committed to his or her job. More significantly, licensing and insurance can protect you from a number of potential problems, such as the following:

• Unlicensed means - uninsured. If you use a contractor who is unlicensed and/or uninsured, it means the contractor has no way of reimbursing you for any property damage he or she may cause. This means you end up paying the price. Likewise, if contractor carelessness leads to injury or damage to someone else's property, the problem is likely to become yours.

• No coverage under the homeowner's policy. THIS IS A BIG ONE!!! Most homeowners believe it is safe to use an unlicensed and uninsured contractor, assuming that any damages incurred would be covered under their own insurance policies. However, this isn't the case. Most homeowner policies require that any work to the property be done by licensed and insured contractors; coverage is often specifically excluded for damages caused by "bootleg" contractors.

• Noncompliance with building codes. Most building projects, even minor ones, usually require permits and inspections. Unlicensed contractors are often unfamiliar with the applicable building codes and are unable to obtain permits. If your project isn't permitted or doesn't comply with building and zoning codes, you may - and probably will - be ordered to remove or repair the job. Even if a building inspector doesn't "catch" your code violation right away, you will almost certainly have to correct it if and when you try to sell your house.

• Con artists. Scams in the construction industry especially in the home improvement business have become almost legendary in the last few decades. Con artists posing as qualified contractors, and often targeting the elderly, have made national news any number of times. Even so, unwary homeowners continue to be taken in by these pseudo contractors, who often promise unrealistically low prices or use scare tactics to close the deal. In these cases, the homeowner typically ends up with either an incomplete or low quality.

• Poor quality work. Not all unlicensed contractors do poor quality work. And not all poor quality work is done by unlicensed contractors. However, as a rule, if there's shoddy work to be done, it's usually done by unlicensed contractors. Because unlicensed contractors aren't subject to meeting specific standards, they are often untrained, less experienced, and unqualified to do certain types of work.
  
  Sloppy work by an unlicensed and uninsured contractor could have serious ramifications. "Basically, it's a safety hazard if your work isn't done improvement project - and several hundred, or even thousands of dollars less.

• Limited recourse for broken contracts. If you have a dispute with a licensed contractor, you can call his or her licensing agency. Some licensing agencies offer mediation services or maintain a guaranty fund to help consumers recover their losses. At the very least, the licensing agency has the authority to suspend or revoke a dishonest contractor's license. While this doesn't necessarily ensure a contractor will play fair, it gives him or her considerably more incentive to do so.  If the contractor is uninsured, it usually indicates they are not financially able to cover problems is the arise.

In most cities, a contractor must provide the city with a certificate of insurance showing the city as a certificate holder in order to pull building permits in that city. The problem is that most contractors who are not licensed and do not carry General Liability insurance will not pull a permit anyway. In addition, there are many small jobs that do not require a permit, and even if they do, an unlicensed/uninsured contractor will "SCAB" the job and not worry about permits.

The problem here is that you are responsible to ensure that the work performed was done in accordance with city code and requirements.  If the city finds out work was performed on your home without a permit, they can require you to remove walls, sheetrock, cabinets and any other impediment to inspecting the work to ensure it was performed according to code. If you sell your home, this can become a hidden defect and could get you in heavy legal issues with any buyer of your home.

In short, protect yourself and your family by only hiring licensed and insured contractors... Make sure anyone who works on your home is licensed and carries enough insurance coverage to protect you, your family and, more importantly, your home.

If you have any questions please email us at sales@onecallhomehandyman.com or go to our site athttp://www.onecallhomehandyman.com for more information. You can also contact us by phone at (832) 800-4441.