Are You Sure Your Contractor Is Insured
While national annual remodeling costs are projected to reach almost $320 billion between April 2017 and March 2018, according to Harvard’s Joint Center for Housing Studies, the number of home owners’ insurance claims related to damage caused by contractors is relatively low.
This is because most claims related to contractor negligence, including theft, are covered under the contractor’s insurance.
However, if the contractor is not properly verified or insured, responsibility for negligence claims may fall to the home owner and their insurance.
The Wall Street Journal’s Robyn A. Friedman recommends verifying the contractor’s insurance and credentials before a project begins. Make sure the firm holds a state license, is bonded (which ensures funds are available to pay the homeowner if the job isn’t completed properly or items are stolen) and has required insurance, including general liability and workers’ compensation. Remember that workers’ compensation pays for medical care and lost wages if a worker sustains injuries on the job.
If the contractor doesn’t have proper insurance, those injured workers may sue you.
Friedman also recommends keeping copies of all paperwork involved in the project, and taking inventory of everything in the home.
