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Discussion Starter · #1 ·
RE:Insurance/bond

I found a few threads regarding insurance & bonding but none that answer my question. Will whined up with hemmroids searching.
A building official who had me under his wings many years ago told me yesterday I should have a $100,000.00 bond and $1,000,000.00 insur. policy.
I do reno/remods. Nothing in high end at this point.
This seems a little excessive.
I'm thinking maybe 1/2 that at the high end.
Any thoughts?
Thanks, PB
 

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Your state probably has minimum bond req. to issue your license. After that the job should dictate what kind & how much of a bond you would need. 1m General Liability policy is pretty normal now days. It's getting more common to see a 2m policy required around here.
 

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Discussion Starter · #5 ·
Griz & Rs,
Interesting! Will have to get with agent & dig a little deeper.
Thanks for the input.
PB
 

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Washington state requirements.

$6,000 bond for specialty contractors.
$12,000 bond for general contractors.

$50,000 property damage liability and $200,000 public liability or $250,000 combined single limit policy.


Now what the bond is for and copied from the state bond from that the bonding agency has to fill out;

If the Principal, in compliance with the provisions of chapter 18.27 RCW, pays all (1) wages and benefits to persons furnishing
labor to the Principal, (2) amounts that may be adjudged against the Principal by reason of breach of contract including negligent or
improper work in the conduct of the contracting business, (3) persons who furnish labor and materials or rent or supply equipment
to the Principal, and (4) taxes and contributions due to the State of Washington, the obligation of the Principal and the Surety shall
be null and void. If the Principal does not pay the above claims, the bond shall remain in full force and effect. In no case shall the​
Surety be liable for any claim not included in RCW 18.27.040.



I don't see a need for a higher bond, unless you don't plan on doing the above. Like paying your help, paying your suppliers, paying your taxes, or making things right if you do something wrong like negligent or improper work.

And the bond is just something they can get right now if you do something wrong and you don't pay up right away.



Now the insurance thing is my pet peeve, just like the minimum on auto insurance requirements.

If you don't own anything and don't mind having your income garnished for the rest of your life, then by all means get the minimum insurance required. But for me the minimum is $1,000,000 and you should have $2,000,000. We have $2,000,000 in insurance.
 

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Forgot to add about the insurance.

Since all insurance companies are requiring a additional insured clause in their contract when you hire a sub or work as a sub. The sub and the primary contractor must have equal value insurance. Meaning that if the general has a 2 million dollar policy, then the subs must also have 2 million dollar policies.

Personally I have never seen a sub with less than a 1 million dollar policy, but they have had to upgrade their policies to 2 million if they worked for me.

Another reason to have high liability limits.
 

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I use Wagner Insurance out of Marysville, you can call them, 360-653-3737, they can answer all your questions for you. I can't remember the exact amounts that's required for everything, it gives me a headache, I just let them set it up.
 

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Discussion Starter · #10 ·
KGMZ,
Lots of good info. Is there a web site for the above info. you gave.
I find it funny how many guys I know in the biz and they only know that they have something. Hell, I don't think they even know what they are paying for. If I don't have my facts straight and know my _ _ s from a hole in the ground, I'm sure to fail.
 

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Discussion Starter · #11 ·
Since all insurance companies are requiring a additional insured clause in their contract when you hire a sub or work as a sub. The sub and the primary contractor must have equal value insurance. Meaning that if the general has a 2 million dollar policy, then the subs must also have 2 million dollar policies.

Not sure if I'm inserting your quote correctly, guess I'll find out.

What's the reasoning behind that requirement?


Kennymac, thanks for the #. I'll give them a call.
 

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That building inspector might have been talking about contract bonds, which is something you probably won't need doing remodels. It's not required by the state.
 

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For insurance check out CBIC and RIS. We were with CBIC for many years until the skyrocketing insurance debacle a few years ago, and then went with RIS at the time because of a lower price. We are still with RIS and have been happy with them, they are very prompt when I need something and have had no problems with them.

CBIC - Contractors Insurance and Bonding
http://www.cbic.com

RIS - RIS Insurance Services
http://www.risnet.com/
 

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Discussion Starter · #18 ·
For insurance check out CBIC and RIS. We were with CBIC for many years until the skyrocketing insurance debacle a few years ago, and then went with RIS at the time because of a lower price. We are still with RIS and have been happy with them, they are very prompt when I need something and have had no problems with them.

CBIC - Contractors Insurance and Bonding
http://www.cbic.com

RIS - RIS Insurance Services
http://www.risnet.com/

Kgmz,
Again, thanks alot for all your help. Will continue to research the info you have suggested.

Take care, PB
 

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general liability insurance to the limits suggested by your carrier and i add take a hard look at an umbrella policy too, especially residential alterations. but definitely not on a bond. there is zero purpose to bonding custom residential.
 

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The additional insured endorsement is put in place to that if a sub has a significant loss, it protects the upstream party (gc, owner, or any other party that is requesting to be added as additional insured in the contract) and the subs limits will be exhausted prior to tapping into the upstream party's coverage. Here's some confusing, but good info on it W W W dot lhfconstructlaw.com/CM/Articles/Articles121.asp

I don't have enough posts to post URLs yet
 
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