Georgia Construction and Licensing Law for Residential Contractors, Specialty Contractors and Home Owners

Sponsored by the Law Office of Kevin M. Veler -- Georgia's Construction Legal Advisor.

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Construction Insurance Explanation
Protecting your home and valuables during a home renovation or other major construction project can raise a number of concerns.  Below is some helpful insurance information to help protect homeowners against a variey of potential problems.   All companies hired to work at your home should carry both liabiltiy and worker's compensation insurance.  Note that in addtion to a workers comp claim, an injured worker may be able to make a tort claim against a homeowner from active or passive negligence.  Active negligence results when the homeowner's actions contributes to the accident (lending a tool, for example).  Passive neglience results when a homeowner fails to act (failing to warn the worker of a known danger such as a hole in the yard). 
 
Be aware that some contractors have provided forged documentation of insurance.  Generally you will want to get a copy of the insurance certificate directly from the insurance company, or, if a licensed contractor, you will want to verify insurance on the website of the professional licensing board.  A typicaly insurance certificate lists the types of insurance the contractor has through the insurance company, including policy number, effective dates and policy limits.  If you have a good insurance agent for your home, your agent will generally be willing to work with you to verify the insurance held by the contractor and if you need additional coverage for risks that are not covered. 
 
Special thanks to Kevin DiPetrillo with Southern Insurance Advisors, Inc. for his guidance and input.  If you have questions or need additional insurance information, I am sure Kevin would be glad to assist you in fulfilling your insurance needs.  Call him at 770.977.4140 or email at kevin@southia.com.

General Liabilty Insurance

 

A reputable contractor should be able to demonstrate that the contractor has General Liability Insurance.  General Liability covers property damage and bodily injury caused by the negligence of the insured. For example, if your contractor catches fire to your home or leaves an unsafe worksite where a neighborhood child is injured, the contractor's insurance covers the liabilty.

 

A typical General Liability policy (GCL policy) lists the contractor as the insured. The contractor owns the policy and extends coverage to the homeowner at their request.

 

An OCP policy lists the homeowner as the insured and acts as the primary insurance for the job. The OCP policy protects the homeowner from the vicarious liability associated with the actions of the contractor. Since the homeowner owns the policy, the homeowner is in complete control of making sure premiums are paid and will be the first to know if the policy cancels for some reason.  OCP policies are written on a per job basis.  The aggregate cap limits applicable to the contractor's GCL policy do not apply as this is a separate and distinct policy.  

 Workers Compensation

 

Because an owner will be held liable for the injuries to contractors and trades that occur on your property, an owner should be certain that a contractor has Workers Compensation coverage. Workers Compensation pays for medical bills and lost wages for any party who is injured on an owner's property who was being compensated for their work. This includes the contractor, subcontractors, subcontractors of subcontractors, day laborers, materials suppliers, and anyone else that’s stepping foot on the owner's property for pay.