Remodeling contractors in California are not required to carry general liability insurance, but if they do not carry this insurance, they are required to tell you.
Most home owners are not aware of this.
If your contractor does not carry general liability insurance and an unfortunate accident does result in damage to your home, your homeowners insurance kicks in.
Ask to see a copy of their general liability insurance policy. If they tell you it’s not important, insist that it is to you. If they continue to tell you it’s not important, find another contractor. If they don’t have insurance, they should just say so.
All remodelers are required to carry workers compensation insurance when they hire employees above and beyond the owners. If the workers compensation insurance is not listed on the certificate for the general liability insurance, ask to see the insurance certificate that shows it to you.
If they tell you they are exempt from workers compensation insurance, verify this on the Contractor State License Board website when you check their license status. It’s at the bottom of their page on the CSLB website.
Why might a contractor have neither general liability or workers compensation insurance?
Because they’re just starting out and they either do all the work themselves or subcontract some out to licensed contractors.
It is not necessarily a bad thing that a contractor lacks this insurance. If they come highly recommended and you know you they’re new in business, it may make sense to give them your bid. You may get a better price as their overhead is lower, and if both someone you trust vouched for them and your homeowners insurance policy is up to date, your risk may be very little. However that is a personal decision you must make.
Need remodeling help? Consider one of the providers in our network.