About Contractor Insurance
Just as you are required to buy insurance to drive your car a contractor must buy insurance to operate their business. Is it possible to get in a car and drive without insurance? Of course. But if the driver without insurance hits your car and you don’t have uninsured motorist insurance you will pay for the damages they caused you. Well, if a contractor without insurance is doing work at your property and a worker gets hurt YOU are responsible for their doctors bills, lost wages, and disability pay. Certain types of insurance are required in order to practice contracting and to obtain permits.
Liability insurance is required. This protects the contractor and the property owner from claims due to damage to the property owners or neighbors property or if someone other than the Contractors employee is injured. If a Marine Contractor uses a vessel in the operation of their business then they need an added provision on the Liability Insurance for Federal Jones Act coverage on their vessels. This is utilized for when a vessel is underway. It is illegal for a company to move vessels without this type of insurance.
Commercial vehicle insurance is required to utilize any vehicle in the conduct of business. This protects the contractor and the property owner from damages caused by a company vehicle.
Workmen’s compensation insurance is required. This protects the contractor and the property owner from injuries suffered by the workmen on the project. Marine construction has additional workmen’s compensation requirements. Any work performed over navigable water (this includes electrical and plumbing) must be insured under the U.S. Longshore and Harbor Workers Act (USL&H). There are no exemptions. If a contractor says that they don’t have workmen’s compensation insurance because they have filed for an exemption this does not qualify for work performed over the water. They must possess workmen’s compensation insurance with a provision for USL&H. If they don’t, then the property owner is liable for any injuries sustained, including doctors bills, lost wages, and long term disability settlements. This should be evident on their certificate of insurance. If you are unsure then call the insurance agent listed on the certificate for verification.
If the contractor does not have any of these insurances and something bad happens that is caused by the contractor then the liability and the costs may fall to the property owner.