Homeowners and Investors!
In today's market, more and more homeowners are staying in their current homes. To save money, some are searching for affordable foreclosures or fixer uppers in need of a little TLC to purchase and remodel.
Therefore, contractors and skilled professionals are in high demand. But with so many professionals to choose from, which one is best for you? One of the biggest decisions homeowners are faced with when choosing a contractor, is whether to hire an insured or uninsured professional. It does make a difference and making the wrong choice can affect your financial future. We offer advice on how to choose the right professional.
Brief Explanation:
Is an uninsured contractor right for you? If you are only worried about the cost and nothing else, then you can save money by hiring a professional that is uninsured and possibly not licensed. Many times, they do not carry insurance because they think that it is too expensive. They also figure that without the extra overhead, they can offer cheaper labor costs.
This does not mean that they are not licensed, skilled, trained or willing to stand behind their services. Do not mistake this article as stating that, as there are many who are qualified, just not insured. Just use caution, especially if they want money up-front or a down payment.
Special Note: Cost of contractor insurance policies are more affordable then most people think. It is based on several factors - what part of the country you live in, how many employees, and how much coverage is desired.
Is an insured contractor right for you? If you are more concerned about protecting your home, investments, or assets, then an insured contractor is going to be your best option.
Special Note: It does no good to hire a contractor that is insured and not be named as an insured on the insurance certificate.
Contractor - Uninsured:
If you are not concerned about one of them getting hurt on your property or standing behind the work they do and cost is the most important thing to you then this is the type of professional you are looking for.
- Should an uninsured professional or any of their employee’s get injured while they are working on your property, there is a chance that you could get sued to cover the cost of their doctors or hospital treatments, including lost wages.
- These are all important things to consider when choosing a professional, even if they are willing to sign a waiver stating they won’t sue you, with a good attorney they will most likely succeed.
- How can you be assured that they will actually honor any work they did if something does go wrong? Remember, the contractor would have to pay the costs of the materials and labor directly out of their pocket without any re-imbursement from you or an insurance company. So even if they are willing to sign a contract stating that they will guarantee the work, many will just use stall tactics until the so called “warranty” has expired. This leaving you paying to get the work done again by another professional. Chances are they are not trying to take advantage of you, but how many contractors can afford the extra time or cost of redoing a job.
Contractor - Insured:
If you are more concerned about protecting in your investment, then an insured contractor is going to be your best option. The following are the types of insurance coverage’s to look for.
- General Liability Insurance. This covers any damages caused to your property while the professional is currently working on site, and any damages or injuries that come up later. This would include anything that goes wrong due to improper installation, workmanship or defective materials. When a contractor is insured, they are more likely to come back and get it fixed right even if they have to hire another company to do it, since it will be covered by insurance.
- Workmans Compensation Insurance. This protects you and your investments from being sued in case of an injury. Should a professional or one of their employee’s receive an injury while working on your property, then the insurance coverage will take over and pay their medical expenses and lost wages. This protects you from filing a claim against your homeowners policy or in a worst case scenario losing all of your investment properties or personal residence in a law suit that could have been prevented.
Only you the homeowner or investor can decide which fits your scenario, but please do not walk away from this article believing that because a professional does not have any insurance that they are unprofessional, unskilled, unqualified or not willing to back their workmanship and labor. It is getting the cheapest labor and hoping for the best or protecting your assets.
There are many who are qualified and will offer a warranty that they are willing to honor. They simply can not afford the insurance at this time or are not fully educated in the real cost. But if you really like a contractor who is not insured and would like to work with them, talk to them about a solution before turning them away. Remember, everyone has to start somewhere even you had to start somewhere in your career before getting to where you are today.
Special Note:
These are strictly recommendations that consumers should consider when selecting and hiring any professional for services.
It is the sole responsibility of the homeowner and investor to decide how to proceed with a screening process that meets their own specific needs and requirements.
Author Bio:
This article was written by Walter Sanderson, founder of this website, STL Home Rehabbers. He has more than 15 years experience in rehabbing and remodeling homes. For more information about him, you can check out http://waltersanderson.stlhomerehabbers.com/.
Article Source: http://www.stlhomerehabbers.com/
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