Insurance is one of the essential things we have to cover ourselves from life’s uncertainties. It falls into different categories. You only chose one that suits your needs. When you are about to start a construction site, make sure that your contractor has contractor insurance. Many pitfalls come with this insurance.
Consider the following tips to overcome contractor insurance pitfalls:
a) The Insurance Policies
Always review your Texas contractors insurance policy. The insurance policies should be in line with the nature of work you are providing your contractor. Insurance policies that do not agree with the kind of work you have should be sent back for revision. Check with a local insurance broker such as, http://pacificunitedins.com/texas-contractors-insurance/dallas-tx/ in your in the Dallas, TX region.
If the contractor is not willing to have it revised, consider hiring another contractor.
b) The validity of the Insurance
Consider checking your contactor’s insurance validity
If your project is going to take two years to go to completion, their insurance should cover them for the entire period.
Also, if their coverage expires before the project is complete, they should
renew it before proceeding with the project. Invalid insurance is a pitfall
that can make you liable to your contractor in case of risk.
c) The Insurance Value
The value of your contractor’s insurance should be reasonable enough to cater for any risks that might occur during construction. For example, if your site is worth $ 1,000,000, the insurance value should be able to cover at least 75% of the building. It will assure you that if the contractor makes some mistakes with your site, you will not incur a huge loss. Instead, you can get a valuable compensation.
d) The Efficiency of the Insurance
You can check how effective the contractor insurance is by checking the insurance company’s reputation.
Have a thorough background check on how the insurance company handles claims. Does it compensate the insured for loss? Is the insurance company registered with the relevant bodies? How long has it been operational? When you get the answers to these questions, then weigh if it is worth ensuring your site
Insurance covers that raise doubt should not be considered.
e) Compliance with the Law
Each contractor insurance is guided by each State’s insurance law. Different states may have different laws on insurance. Thus, you should consider looking whether it is complying with what your state need of them. Insurances that violates such laws shows lack of
seriousness and should not be considered. We all expect competent contractors to know the content of their insurance. If their coverages can be that
violating, then the owners might not be law abiders.
f) The Insurance Limits
As the site owner, you should understand the extent to which the contractor insurance cover. This knowledge will help you know what to do in case a risk that is not covered by the
insurance occurs. It will help you to avoid unnecessary conflicts with your
contractor. Insurance covers explain in detail what they cover the insured. They also clarify if they protect third parties against such risks.
It takes time to grow a business but a few moments to bring it down. You can choose to protect your business’s expansion by being keen on these tips of overcoming insurance pitfalls on your construction. Constructing can be tricky, but with the correct information, you can always have a successful journey.