The Bush Insurance Blog

Protect Yourself From Uninsured Contractors

Posted by Chester Butler on Tue, Sep 27, 2011 @ 06:00 AM

Make sure your contractor is insured resized 600The fastest way to heartache and financial loss when remodeling is to hire an uninsured contractor.  Here’s what can happen:

  • You may become liable for work related injuries to the contractor’s employees. Your Homeowners policy will not pay for this kind of loss. Protect yourself by requiring the contractor to carry Workers Compensation Insurance.
  • If the contractor damages your home, you may be stuck with an expensive repair bill.  If your Homeowners policy pays the claim, it is likely they will then cancel your policy. Then it may be difficult to find replacement coverage.  And a new policy will be expensive.  Insurance companies will penalize you for using an uninsured contractor that caused a loss.

So how do you make sure your contractor or handyman service is insured?

  1. Ask your contractor for a Certificate of Insurance. A Certificate of Insurance is proof the contractor is insured. Insurance agents do not charge the contractor or the contractor’s customer for this service. An insured contractor will be happy to provide you proof of insurance.
  2. Ask your contractor to have his agent send the Certificate directly to you. Do not allow the contractor to hand deliver it. Why? Unethical contractors do create fake Certificates to dupe homeowners.
  3. Are you planning a major project or need a major repair?  Ask the Contractor to add you as an Additional Insured to their liability policy. This protects you if the contractor hurts someone or damages someone’s property while completing your project. If you are an Additional Insured, the contractor’s insurance will defend you if you are sued. This can save you the hassle of a lawsuit and financial loss.

Most contractors are hard working and honest business people. But it’s up to you to protect your family from the bad apples.

One last tip! If you are planning major repairs or remodeling, please let us know. That way we can keep your Homeowners policy up-to-date. Just call us at 615-777-1165 or email us.


Tags: certificate of insurance, licensed insured and bonded, uninsured contractors, additional insured

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