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Protect yourself

License and registration please? If you have ever been pulled over for a traffic infraction, you have heard those words. And if you do not have both license and registration you may be in some trouble. It will also cost you some money. Well, the same holds true of homeowners who hire contractors. Ask for their license and insurance.

Most states require contractors to be licensed or registered with the State Board. In most cases the state will have minimum requirements that must be met in order to get licensed or registered. Usually it means that the person or company is qualified to do the type of work that you will hire them for. It may not mean that they are the right contractor for you, or that they will show up on time, but they have met the states minimum requirements.

Check your states Contractor Board website and make sure that your potential contractor does not have any complaints filed against them. Check to make sure that they are, in fact, licensed and that their expiry date is not in the immediate future. If it is, let them know that your bank or lender will be asking for docs to prove the renewal is basically "in the mail".

Insurance is another matter. There are two main types that contractors must have in order to come work on your home. General liability protects you in case the guy burns down your house or knocks down a wall accidentally. This type of insurance will be rated according to what trade the contractor is involved in. If you are having someone add onto your home, or build a new home, they need general liability that is rated for those trades. If a contractor has GL insurance for doing painting and drywall, they should not be acting as a builder. You would not be covered if something happened.

Workers compensation is the other type of insurance a contractor is required to have. It should cover both the contractor and any employees that will be working on your addition or build. If they get hurt, they won't be suing you for the damages. Also make sure that any sub-contractors that are hired have their own WC insurance. I like to make it a point to get their insurance agents name, and have the agent fax me the certification of insurance directly. Protect yourself!

 

Kevin Robinson is a building consultant. He is formally educated in general residential construction as well as "schooled" on the job. Formerly licensed as a general contractor in the State of Idaho, he currently shows potential owner builders how they can save thousands managing it themselves.  He has written guest articles for a few construction type  magazines and also publishes his own small newsletter for owner builders. Email Kevin at crownlinehomebuilders@yahoo.com

 

Next time, hire a building consultant!.

 

Comment balloon 1 commentKevin Robinson • October 25 2009 08:49AM

Comments

Very good reminder. We have a section in the California purchase agreement advising buyers to use licensed insured contractors for insepctions as they are liable during escrow for any damage to the home during inspections.

Regarding driving - good advice is to have your license and insurance in your visor or console readily available if you are ever stopped so you look alert and prepared for the officer.

Posted by Lori Bowers over 9 years ago

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