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Never Hire An Uninsured Contractor And Here’s Why

Whether it’s an industrial or commercial building project, the most important decision you will make is choosing the contractor for the job. Even though I manage an industrial coatings (industrial painting) company, there are things I’ve learned about contracting that can be useful to any business looking to hire a contractor for their project.

When choosing a qualified contractor, many people overlook one basic and yet very important item: contractors’ insurance. For contractors on pharmaceutical and medical industrial and jobs, this has much larger and far-reach implications and insurance may be more complex. The point is, contractors maintaining comprehensive insurance is a must!

portrait of smiling contractor with walkie-talkie

Lives and Liability

Having adequate insurance is required by any company or general contractor who works on any project as value. Right? That may not be the case with direct-to-owners who are a different story. It is surprising how many direct-to-owners assume adequate coverage which could expose owners to potential liability if mistakes are made during the execution of work for the owner. Making sure they are insured with general liability as well as workers compensation is an absolute must. You may ask, “but why is such extensive insurance so important?” First of all, you don’t want someone harmed, killed, or maimed on your property without the contractor having full insurance. This could make you responsible for the damages that range from medical bills to lost wages, which could potentially spell financial ruin for you or your business.

“Make sure your contractor has all the proper insurances that are up-to-date and verified.”

Kirby South

“Lack of Proper insurance is Bad Business”

Proper insurance protects all parties. When a contractor is insured, they are more likely to maintain safety education and standards for their employees, thus avoiding injuries as often as possible. The impact of one person being injured has ripple effects on the individual’s family, the work family, and community.  The ripple extends to the liability exposure to owners and other stakeholders involved with the worksite.

Construction worker accident with a construction worker. First aid for injury at work.

“Lack of Proper Insurance is Bad PR”

Not only is it traumatic for a bad job injury to happen at your plant or your place of business, but it makes for terrible headlines that connect you to something that was not at all your fault. You want publicity for the good things you do, not for the mistakes or lack of professionalism of others around you.

Injuries on the job bring fire engines and/or police cars to your place of business/job site which is very distracting to others on the job. I have seen this happen to businesses that hired contractors without insurance and it was an ugly ending to the story. The thing to consider is that if someone is willing to operate without insurance, then they are most likely not doing proper safety training and following other guidelines that insured contractors do daily. Such situations are bad publicity and they can stop or close your business temporarily, and sometimes permanently.

Long-Term Assurance

We all understand that maintenance is inevitable; but we don’t ever want to do more than we have to. Pay for it to get done right the first time or pay thrice later. It is true that it costs more to hire a qualified contractor with all the right insurance coverages, and it is also true that the quality control and longevity are what save you money in the long run.

Safety Is A Happy Place

You want to promote a safe working environment for your employees. It is so important to keep your business operating safely on a daily basis. When a contractor has insurance, it is a way of making sure that everyone working on site is protected as much as possible when they are under your watch. It proves a social responsibility as well as a professional standard. It also shows that they care about the quality of their reputation and projects. In my experience, companies that understand and practice this sort of value have a long-life expectancy.

Whether its Damage Claims or Injury Claims, claims will surely happen simply via the laws of statistics. So before job site injury or damage occurs make sure that you are only hiring fully insured contractors. And if you are a contractor who is not yet fully insured, don’t continue to roll the dice and cross your fingers everything “goes okay.” Reputations are made by purposeful actions and being insured is a big part of purposeful success.

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