Baton Rouge homeowners may want to take note of a new law, taking effect Aug. 1, that requires home-improvement contractors to obtain a Louisiana contractor’s license before doing more than $1,500 worth of work on any project. The new law aims to protect homeowners from fly-by-night contractors whose shoddy work may lead to construction litigation or, in the worst-case scenario, leave disgruntled homeowners with nowhere to turn.
Although proof of a valid contractor’s license may give homeowners some assurance of a contractor’s legitimacy, industry professionals also advise homeowners to request proof of insurance before signing any home improvement contracts. The new law requires contractors to carry $100,000 of liability and workers’ compensation insurance. Making certain that a contractor is properly insured can help avoid unnecessary expenses and litigation in the event of a workplace accident or defective construction.
Workers’ compensation insurance covers expenses resulting from injuries to employees on the job site, except in cases where a homeowner’s negligence caused the injury. Because the homeowner may be liable for injuries resulting from personal negligence, professionals recommend checking one’s own home insurance policy ahead of time in order to confirm that any negligent injuries will be adequately covered.
Liability insurance should cover damages to the home that result from the contractor’s mistakes or negligence, such as fire or water damage resulting from a cut utility line. Liability insurance also covers injuries to other people that happen on the homeowner’s property and are related to the construction work.
Construction law can be a complicated field, especially when one or more insurance companies become involved with a claim. By checking a contractor’s license credentials and insurance coverage, homeowners can take a step toward reducing their risks in litigation when a remodeling project takes a wrong turn.
Source: Shreveport Times, “Ask contractor for proof of insurance,” Jeb Breithaupt, July 18, 2012