Why Your Property is at Risk When Contractors Do Not Have Insurance
April 15, 2010
Many people, landlords included, believe that if any accidents occur while a contractor is working on their property that they are not responsible. Not so. Require two kinds of insurance of any contractor you hire to work on your property, Workers Compensation and General Liability.
Most states require employers to have worker’s compensation insurance. The employer is responsible for any accidents to his or her employees not only during the job itself, but in some cases even on the way to or from work. If a building contractor does not have worker’s compensation insurance, then the property owner is directly responsible and can be held completely liable for the pain and suffering of an injured construction worker. How’s your insurance coverage?
Common Excuses for Not Having Insurance
Often when a property owner asks a contractor if he has general liability or worker’s compensation insurance and the answer is “no,” the contractor will quickly add a standard excuse like the following, often acting belligerent and as if he has been insulted. Do not be intimidated. Deal with a fly-by-night contractor and you risk your property and your financial wellbeing.
Standard excuse #1: “It is not really necessary because my customers have insurance. Why waste more money?” Answer: Nice guy! This a little bit like saying I don’t want to bother to cover myself so I’ll just leave you holding the bag?
Standard excuse #2: “I do not have insurance but then I only use subs and they do.” Answer: If this guy is not responsible enough to have insurance, then why is he all of a sudden going to make sure his subs do?
Standard excuse #3: “If I did have insurance, I would have to charge you substantially more for the work I am supposed to do.” Answer: Nonsense. You can always find an insured contractor who can outbid someone who is uninsured.
Standard excuse #4: “It is not required.” Answer: In many states worker’s compensation is required. But even if the state does not require it, then you, the property owner, should require it! Remember, it is your liability!