How You Can Protect Yourself by Working with a Bonded and Insured Contractor

September 18, 2019

When you’re getting ready to do work on your home, such as a custom cabinet installation, you’re probably going to hire a contractor. That contractor needs to be both bonded and insured in order to protect you and your property. To the average person, it might sound like the same thing, and not be clear why you need both. So, what’s the difference between bonds and insurance, and why does it matter?

The main difference is which party the protection benefits: you or the contractor. Ideally, you want to work with a fully-licensed contractor who is both bonded and insured, ensuring everyone is protected and your custom cabinets in Phoenix, AZ turn out how you envisioned them.

A contractor’s bond

A contractor’s bond primarily protects the client. In order to be bonded, a company pays a premium to a surety company. This ensures that the company has access to a certain amount of money in the event that a client files a claim against them with the surety company. So, for example, if your unbonded contractor ruined your cabinets, you would have little recourse for recovering the damages.

Bonds also apply when your contractor hires subcontractors, fails to complete a job, doesn’t obtain the necessary permits, fails to meet a financial obligation and more. You can ask your contractor for their bond number and company to verify with the company that they are currently bonded.

Contractor’s insurance

Contractor’s insurance protects the contractor and their company. The two main types are worker’s compensation insurance and liability insurance. Worker’s compensation insurance compensates injured workers for lost wages and medical bills, regardless of who may have been at fault for the injury. Liability insurance, on the other hand, exists to pay for any damages they cause to your property.

The reason you need the bond in addition to this is because liability insurance doesn’t cover poor work or the cost of repairing or redoing the work. Further, without insurance, you could be responsible if they injure themselves on your property.

Contractor’s licenses

Having a licensed contractor adds another layer of protection. A licensing board will have certain minimum standards of workmanship and business for their licensees, which demonstrates the contractors can comply with laws and regulations. Depending on where you live, your contractor may actually need to be licensed in order to be bonded or insured. They may also need special licenses depending on their trade.

Not only are you risking shoddy craftsmanship and personal liability with an unlicensed contractor, but in some states, you might be giving up your right to make warranty claims, or your right to recover the cost of repairing any damages inflicted. That means you’d have to sue in civil court. However, without a bond, the unlicensed contractor may not be able to pay any monetary damages. It’s just smart to protect yourself by hiring a bonded and insured contractor with the right licenses in the first place.

Contact Authentic Custom Cabinetry to hire a fully-licensed, insured and bonded contractor to take care of your custom cabinets in Phoenix, AZ and Las Vegas, NV! Kitchen cabinets, bathroom cabinets, office cabinets, and more. Contact us today for details!

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