Is This Sub-contracted Or Cost Of Materials?

Mike Finley

I may be having a brain fart here, but I was thinking about this.

When I hire an electrician for a job he is a sub-contractor and my insurance company wants to keep track of the percentage paid to sub-contractors as a percentage of overall sales. I have heard you can lower this percentage by having the sub break out labor and materials and by paying for the materials seperately.

Now, let's say for instance you hire Home Depot to install the carpeting on a job (yes, I know this would be crazy but just bear with me), and the customer goes down and picks out the carpet but you charge them for the carpet and installation in the bill.

This would actually be qualified as a sub-contractor by your insurance company also wouldn't it?

PipeGuy

Yes-unless you can somehow pay for the carpet and installation seperately.

My insurer does the same thing. But for me, the savings gained by administrating the installation and material costs independently doesn't exceed the additional insurance premium expense.

Grumpy

I usually buy my subs's the materials but that's the way they prefer it. Then again I have long term very personal relationships with my subs.

Yes I too have been kicking back and forth the idea of making my subs give me completely seperate invoices when materials are involved.

Mike Finley

So if I ever was in this situation, I need Home Depot to give me an insurance certificate then don't I?

Grumpy

LOL they are probably too unorganized to figure out how. I liked it when I briefly worked there and would talk to the sales reps who had no clue what they were doing. Them: "We're licensed and insured." Me: "Really? Have you ever seen a certificate?" Them: "Ummm. What do you mean?"

Reasons like this are why I only stayed through training and then left.