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Hire a Licensed Pro! Avoid the Pitfalls of Hiring Unlicensed Companies

Updated: Jan 9

Always Hire a Licensed Pro! Avoid the Pitfalls of Hiring Unlicensed Companies.

When it comes to making improvements in your home or business, certainly price can often be the first and biggest determining factor. But think again, as relying on price alone can be a costly decision in the long run for a multitude of reasons.

The most important and first question you should ask when hiring a company to work on your home or business is – are you licensed and insured?

What is a Licensed Company?

The company has the legitimacy to be a professional in their industry. This means they have a license to meet and maintain industry standards. A license is costly to achieve and maintain. A license shows a company’s commitment to be and stay certified; by following all the laws as set by the state and local authorities.

An unlicensed company cannot give this same assurance. Though their lower prices may be more attractive, they have to cut corners -such as being unable to pull permits, which many projects require to comply with area statutes and regulations. Consider from a logical standpoint, that an unlicensed company may not have a license for a reason – their work is likely subpar, and they don’t have what it takes to obtain a license. Remember, since they are not held accountable by area regulations, they may not have the same pressure to perform the best work the correct way. Imagine a job that typically should require a permit – if the unlicensed company doesn’t submit the necessary paperwork to the local authorities, their work will also never be checked for compliance to state and local rules. Non-compliance could lead not only to fines for the home or business owner but also to possible injuries or death. You and you alone have to take on the legal and financial consequences of the work of unlicensed companies you hire.

Liability Insurance & Workers Compensation Insurance

Licensed companies are required to carry both Liability Insurance and Worker's Compensation Insurance. An unlicensed company is not usually able to obtain either of these.

Imagine if an unlicensed company during an installation accidentally hits a water pipe and causes water damage to your home or business. Your own homeowner’s policy may not protect you, but a licensed company’s liability insurance will protect you for the cost of damages and repair. You could even void your homeowner’s insurance policy if any claim is a result of an unlicensed company’s work.

For worker's compensation, a licensed company will carry it for themselves, their employees, and any subcontractors they bring on site. It’s not fair that you would get stuck with the medical bills if someone working on your property injures themselves, and this is exactly what could happen if you hired unlicensed companies. Imagine if the unlicensed company brings in a team of workers. YOU, the home or business owner have now unknowingly assumed the responsibility as the “general contractor” for the job – both legally and for financial liability claims. And as such, can be responsible for any medical costs as a result of injuries or death on your property.

When considering a pro for your next job, remember that the purpose of using licensed professionals is to reduce risk and uncertainty; and when it comes to your home or business – be sure to hire companies that will respect your space.