Sub Contractor Insurance
Subcontractors typically refer to people a contractor hires to perform smaller jobs within a project. Subcontractors may include plumbers, electricians, and cement workers, among others. These people need to carry insurance to protect themselves and their contractors against liability claims. Without insurance, the contractor who hired them will be liable for everything. This is why it's important to hire subcontractors who carry insurance. It is also important for subcontractors to carry insurance so that they don't lose everything.Subcontractor Insurance Requirements
Subcontractors must carry insurance against claims of injury or damage to people or property resulting from a subcontractor's (or his workers') work. Insurance requirements may vary, depending on the contractor's requirements and what the state dictates. For instance, subcontractors should have general commercial liability, auto liability, worker's compensation and employer's liability, and professional liability.
Monitoring Subcontractor Insurance
It is important that a contractor makes sure the subcontractor has insurance. Contractors should not just take a subcontractor's word that his or her insurance is accurate and current at face value. Contractors should establish a monitoring system, such as checking the authenticity of insurance statements. Otherwise, a contractor's insurance company may charge the contractor more to cover any gaps that may exist in a subcontractor's insurance policy. Contractors should consider whether the subcontractor is sufficiently covered by insurance to protect his or her assets. The client should not be allowed to dictate how much insurance is enough.
Advice to Homeowners
Homeowners who want to complete smaller projects that don't necessitate hiring a contractor should also make sure the subcontractor has insurance. There are many horror stories about subcontractors who damage property or leave without finishing work, only to never be heard from again. You may think you're saving money by hiring an uninsured subcontractor, but this may not be the case. For instance, you might hire uninsured concrete workers to lay a driveway and find that they have never before worked with concrete. If they make a mess of the job and leave town, you may find yourself unable to trace their whereabouts. Finding contractors who are insured reduces the risk of this happening.