Legalese: Require Contractors to say they have liability insuran

[Ryan Smith]

So, i want all contractors to start signing a contract saying, among other things, No extra pay unless there is a change order approved.

Only thing I'm not sure about is should I require all contractors to say they have liability insurance? Many work for a big name company and do smaller contract jobs in the side with their skills. I know I've only done 1 house but I'm fortunate nobody filed a mechanic lien or got injured. That would've been bad! So knowing we want to do many, it's a good idea to be protected. What is reasonable knowing we still want to work with these independent contractors and still be protected?

[Monica Breckenridge]

My husband and I deal with this on a daily basis. We have done many fix and flips and own 100 rental properties that require maintenance and upkeep.

We require a certificate of Liability insurance. We get a w9 as well from our contractors. You should get a contractor lien waiver signed. We learned our lesson once. A general contractor we hired was not paying his subs and then the subs filed a lien on our property even though we paid the contractor.

Make sure they have workman’s comp insurance. You can have them sign a workman’s comp waiver, however if your contractor hires employees then your at risk. Your company can get your own workman’s comp insurance policy to make sure nothing slips through the crack.

Make sure you also have property insurance for non owner occupied for fix and flip transactions. Get vandalism and theft coverage. There for a while in my city thieves were breaking in and stealing supplies, copper, and appliances.