For quite a while, you have wanted to renovate your not-so-spacious, outdated kitchen. You finally have the funds and opportunity to do it, so you ask among your friends and coworkers to find a contractor. You finally hire one they recommended, but you are unaware that you need to, and don’t even know how, to make sure that your contractor is insured in College Station. With a huge helping of good luck, the renovation goes smoothly, and you are delighted with the results.
But things could have been different if your contractor was not insured and luck wasn’t on your side. You see so many shows on television depicting the making-right of poor jobs that shady contractors do. To avoid such, you have to make sure that your contractor is of good reputation and fully insured.
Difference Between Bonding and Insurance
Most reputable contractors advertise themselves as “bonded and insured.” But what, exactly, does that mean?
A surety bond ensures that you’re protected if a contractor abandons his work or does sub-par, shoddy work. This bond ensures that you won’t have to use your own money or insurance to pay the bill in such cases.
A contractor’s insurance protects you against the cost of both damages and lawsuits. If there was some kind of damage to your home during the renovation, the contractor’s insurance ensures that you or your insurer won’t have to pay for repairs. Also, you won’t be legally responsible if any of the contractor’s employees gets injured during work on your project.
What Kind/How Much Insurance?
Taking steps to make sure your contractor is insured in College Station is just the beginning. You also need to make sure the contractor has adequate coverage and the right types of insurance.
First, in the event of a major damage to your home, will the contractor’s insurance cover for it? For instance, if your contractor’s insurance will cover $500,000 for your house worth $1.5 million, then it will be best for you to continue your search for a new contractor. Your contractor should carry general contractor liability insurance comprising the following types/levels of coverage:
- Liability insurance – Covers injury to you or your family and protects you from lawsuits
- Workman’s Comp – Protection for the contractor’s employees in the event of injury (not required in all states for smaller contractors, so you’ll need to ask)
- Property damage – Covers damages to your home during the course of the project
Steps You Need to Take
How exactly can you make sure that your contractor is insured in College Station? To reduce the risk and be certain that you have chosen a reputable and fully insured contractor, you can follow the following steps.
- Check out the contractor with the Better Business Bureau
- Check references and talk to former customers
- Have a formal in-depth meeting with the contractor before signing any contract
- Ask to see insurance and bonding documents
- Get everything in writing – all aspects of work to be done, work milestones and payment schedule, completion date, contingency clauses, and so on
How Does Your Contractor Deal With Subcontractors?
For instance, if adding a room to your home is part of your remodeling project, the general contractor you hire may also have to hire subcontractors who will take care of framing and brick laying. This raises a question, “are the subcontractors insured?”
In most cases, employed subcontractors are paid on cash basis. If anything goes wrong, they are not covered by the general contractor’s insurance or bonding, because there is no record of their employment by the general contractor. So apart from looking into your contractor’s insurance status, you should also know how your contractor deals with subcontractors.
Before doing any major work in your home, it is very important that you make sure your contractor in College Station is insured. When checking out contractors, your local real estate professionals can offer you help.
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