Working with a non-insured contractor is the worst possible risk that any home owner could take. All contractors must have two kinds of insurance, those are, worker’s compensation and liability. Both of these insurance policies protect the homeowner in various ways. For instance the liability insurance ensures that you as a home owner are protected in case damage is caused to the home by the contractor. This could be in such a case whereby said contractor was fixing the upstairs bathroom and the bathtub came crashing through the floor. A common misconception is that homeowner’s policy will cover you in such an event while in real sense, it does not.
WHAT CAN HAPPEN IF YOUR CONTRACTOR ISN’T INSURED
Failure to hire insured contractors could lead to loss of your property. In a worst case scenario, you might be sued all the way into bankruptcy. Furthermore, most of the state laws allow one to have a limited amount of property or wealth once you have been declared bankrupt therefore inconveniencing you. Here is a closer look at what can happen.
Secondly, as mentioned earlier, homeowners policies of insurance exclude the damages which occur as a result of using non insured contractors. A legal precedent which may illustrate this is the California case of Mendoza versus Brodeur whereby the plaintiff had his neighbor do some work on his home. The home owner’s defense was that he thought the defendant was an insured contractor. However, the court quashed this defense and held that anyone who hires a contractor who is not insured should be covered by workers compensation in the event that an injury occurs during the job.
Even though there is no guarantee that a non-insured contractor will perform a poor job as compared to he who is insured, the risks involved are too great. This is why:
1. BASIC PROTECTION
Proof of insurance in the specified field shows that whoever you are hiring has at least attained the minimum level of skill. This shows that the contractor did not simply gain his experience from watching contractor shows, rather, he took his time to learn and understand the basics of contractorship and what it takes to do a great job.
2. PROTECTION OF PROPERTY VALUES
Supposing you would like to sell your home, there are certain facts which must be disclosed to the next buyer. If the paperwork shows that the contraction projects on the home were carried out buy a contractor who was not insured, the general value of the property could be lowered significantly. Consequently, you will suffer a loss for a property which you had definitely put a lot of work in.
3. DAMAGE TO THIRD PARTY
Apart from the damage that may be caused to the home and the contractor himself, third parties such as passersby or nearby property may be at risk. In the case that a third party has been hurt due to the contractor’s negligence, the burden of awarding damages falls on the homeowner thereby flooding him with even more expenses.
The most essential thing to keep in mind before hiring a contractor is that the safety of your assets come first. Getting an insured contractor saves you from issues like bankruptcy and having to compensate the injured worker during the period of the contract.Reputable contractor companies can easily be found online and they are also quite affordable.