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Six Reasons to Ask Contractors for a Certificate of Insurance

Hiring a good contractor is a serious business that if done accurately results in finding the most proficient contractor for the job. There are many things you will have to check in order to find a reliable contractor that you can trust so before hiring one, make sure you ask for recommendations from friends or check the references by calling them to get informed of whether they were satisfied with the work.

You may want to call the trade association for more useful information or financial institutions to see if the contractor is financially responsible. One of the most important questions you should ask the contractor is the one concerning his insurance policy.
You do not need a contractor whose insurance policy is not valid or who hires workers without compensation insurance.
Keep in mind that in case any of the workers is injured while working on your property, you may find yourself in a difficult situation if the injured file the claim. Before you let any business owner work on your property you need to ask for a certificate of insurance. Some of the reasons for doing so are:

  1. If anything bad happens to people or property, you may be the one to pay for the injuries or damage in case the contractor does not have workers` compensation insurance.
  2. Even if the workers are hired for only temporary work from a labor agency, and the contractor claims he is exempt from carrying workers compensation insurance, without proper insurance policies they should not work on your property. The agency may sue you for any injuries that may happen during the project.
  3. If the insurance policy is not valid or the renewal date has expired then the high costs of legal fees and claims may be too much for your budget and leave you financially ruined.
  4. There are situations when the job is not done properly, for example one of the pipes in your bathroom is leaking and floods the flat below. If it is contractor` fault, you will not have to pay for the damage yourself.
  5. If the contractor you want to hire for the job has a proper certificate of insurance, signed and with correct policy number and expiration date, then it means the contractor is highly professional and deserves your trust.
  6. During the project there may be so many workers on your property that you will not be able to tell which people are those hired by the contractor, agency or perhaps freelance workers. To protect yourself from any inconvenience you should always ask to see all the certificates of insurance, for everyone involved in the job.

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Avatar for Tom Hester
Written by: Tom Hester
Tom has worked in the insurance industry since 2005, where he has become a source of knowledge. He’s gained a reputation as a writer. He has published a series of ebooks about insurance, like “A complete guide for Contractors Insurance and Handyman Insurance” and “Understanding Builders Risk Insurance.”