When the time comes to finally have your dream house built or get that long-overdue major remodeling done, one of the most important things you need to take care of right out of the gate is hiring the right general contractor for the job. Once you find a good contractor, you can have some peace of mind knowing that your construction project will be in good hands.
Finding a good general contractor, however, can get tougher than you think.
We live in a world where some make a living out of offering services they don’t have the license to do, and they do get hired by people, especially when they typically offer cheaper rates. The results, of course, tend to be disappointing at best, and disastrous on so many levels at worst.
If you’re on the lookout for a general contractor, then your only chance of hiring a good one is to always go for one with a license. There are so many reasons why hiring a licensed contractor is important, and at the top of that list is the fact that licensed contractors are also insured contractors.
So why does your general contractor have to have insurance? Let’s take a look at some of the reasons.
It establishes their credibility
For your construction project, you would want to work with someone who is a legitimate player in the field. Licensed contractors are typically insured because insurance is usually a requirement for anyone applying for such a license. When your contractor is armed with the proper contractors insurance policies and a license, you can be sure that your construction project will be in the hands of someone who is qualified and credible.
You can avoid liabilities for injuries and damages
Contractors with insurance typically hold two types of policies: General liability insurance which covers injuries or property damage, and workers’ compensation insurance, which pays the lost wages and medical expenses of workers who get injured while working on your construction project, as well as death benefits to families of those who lose their lives on the job.
As a homeowner, you have to be absolutely certain that your contractor has these types of contractors insurance at least, because if he or she turns out to be uninsured, you will be, in effect, the general contractor and therefore, the liable party for any injury, death, or property damage that takes place during your construction project.
Lower long-term costs
One of the reasons many homeowners go for unlicensed and uninsured contractors is that they tend to offer their services at much cheaper prices compared to those who have the proper license and the right insurance policies.
In the long run, however, you could end up spending more because of an unqualified and uninsured contractor. Aside from the higher likelihood of making construction mistakes that may need to be redone later, an unlicensed and uninsured contractor can also push up your costs if his workers rupture a sewer line or one of them falls off the roof.
Never hire an uninsured general contractor
It’s easy to get tempted to hire an unlicensed and uninsured contractor because of the savings in terms of fees. A penchant for penny-pinching, however, could ruin you in the end. Not only are you not getting the great quality of work that you want; you could also be at the receiving end of a lawsuit that could easily drive you into bankruptcy, which is one situation you would never want to be in if you can help it.
Also, don’t rely on your homeowners insurance policy to bail you out of claims by contractors who got injured in the course of your construction project, or paying for any property damage they might have caused. Once it’s been established that you knowingly hired an unlicensed and uninsured contractor, you can be sure that your homeowners insurance will not cover any injury or damage, and you will end up paying for everything and possibly losing it all.
Unless you are willing to assume the risks for the mistakes of contractors, never hire a contractor without the proper insurance coverage. The potential risks simply far outweigh the benefits.
About The Author
Rachel Porter is the content specialist for Custom Contractors Insurance, LLC, an Arizona roofing and contractors insurance company. When not writing, she enjoys reading and mountain biking with her friends.