Uninsured contractors are a danger to your financial affairs because they expose you to significant financial risk in the event of an injury or damage to property. Though they may present you with an opportunity to save money in the short term, the long term risk to which you are being exposed may prevent you from ever opening your doors for business.
Uninsured contractors may have no way of repaying you for any property damage he or she causes, putting the risk of extended damage squarely on your shoulders. If you are renting the location of your business, your agreement may explicitly state that you must hire an insured contractor to complete the job. Failure to do so could put you at considerable risk should damage to property occur.
If you think to yourself that your property insurance policy will cover whatever damages or losses occur as a result of your uninsured contractor, think again. If an employee of the contractor is hurt while working on your property and a prolonged hospital stay is required, different insurance scenarios can come into play depending on the status of the contractor. If the contractor is licensed, his workers compensation policy will come into play. If he is unlicensed and uninsured, then your insurance policy becomes the primary insurance.
However, when a serious accident occurs, both the injured party and all others that were impacted by the damage will likely sue to recover their loses. If you knowingly hired an unlicensed contractor and an injury occurs during the performance of the contract, then your insurance company has the right to not pay the claim, leaving you exposed to the medical or personal injury bills. If the insurance company wins a judgment against you, any asset you receive in the future can have a lean placed against it. All judgments are made a part of your credit history and remain there until they are paid.
So what about one-man teams? If your contractor is a one-man operation, he can be exempt from having to carry workers' compensation insurance. However, this is very risky for you, as he may well engage the services of an assistant and, if the assistant gets hurt, you may have to pay the medical bills.
When hiring a contractor or sub-contractor, make sure each carries public liability and property damage insurance. Do your homework by taking the time to check with the insurance agency to verify that the policy is still effective and will be throughout the duration of your engagement.
The bottom line in this debate will affect the bottom line of your family. If the contractor is uninsured or has uninsured employees, don't even consider hiring them. Otherwise, you could be sued and held monetarily responsible for worker's injuries sustained while on your property. Check with the Better Business Bureau (BBB) to discover which contractors may have had complaints filed against them and get as much detail as possible to determine whether or not the complaint was legitimate. Shortcuts can (and have) been taken by many other people like you, but are you truly willing to take on such an additional risk before the doors of your business have even opened?
Air conditioning and heating services is something very important to us these days.That's why it's very important to look the best air conditioning contractor to ensure that quality of service will receive.
ReplyDeleteAir Conditioning Contractor Mississauga