Tips for hiring contractors

March 18, 2019 by PEMCO Insurance

contractor-2-(1).jpg Your home is so much more than four walls – it's the stage on which you live your life.

When you're ready to remodel or repair yours, make sure the person you choose for the job truly can deliver the results you want. Here's what you'll want to know to get started:

Finding the right contractor

Washington and Oregon have many skilled, ethical contractors. Here are some quick tips to help you find them:

  1. Ask friends for referrals, check consumer websites or contact your county's Master Builders Association.
  2. Make sure the contractor is registered, bonded and insured. In Washington, contact the Department of Labor and Industries at 1-800-647-0982 or visit In Oregon, contact the Construction Contractors Board at (503) 378-4621 or visit See below for additional information.
  3. Get written competitive bids from more than one contractor to find the best fit for you. Always request written, itemized estimates that detail the work to be done, the labor and materials required to complete the job, and the costs. Warranties, if any, should be in writing. Leave nothing to interpretation.
  4. Check references, including suppliers, who can tell you if the contractor has a responsible payment record.
  5. Avoid contractor scams. Recognize the warning signs, such as "too-good-to-be-true" prices, requiring payment in cash, no written bids, special "today only" deals or similar high-pressure sales techniques. (see more at:

Once work begins

After you've chosen a contractor and are ready to get started, keep the following tips in mind:   

  1. Permits. Be sure all permits are completed before the work begins. During the work, confirm that required inspections have been completed. Ask for documentation.
  2. Payments. Use caution with down payments or paying for work not yet completed. If you are asked to advance money for materials, make checks payable to both the contractor and the supply house. Never pay in cash. 
  3. Get changes in writing. If the scope of work changes, have the contractor provide the changes and costs in writing for your review and approval beforehand. 

Remember: The contractor works for you. Don't be shy about asking for what you need to ensure you are comfortable with each step of the process. 

Bonding and liability insurance

In Washington and Oregon, contractors must register with the state and maintain a bond and insurance. Although it's illegal to work without those requirements, some marginal operators skip them and bid projects at cut-rate prices. (Check out these tips at: ) If you hire an unlicensed, uninsured worker, you assume the risks of a sub-par job. You're also more likely to be on the hook for liability if a worker damages a neighbor's property (for example, felling a tree in the wrong direction).

In Washington, general contractors must maintain a bond of at least $12,000 to pay for repairs if your project is done poorly or if they don't complete it. In Oregon, it's $20,000. Specialty contractors like painters and electricians may have lower bonds.

They also need at least $250,000 in combined property damage and liability insurance in Washington and up to $500,000 in Oregon, with some specialties requiring less. That protects you if, for example, an errant nail punctures a pipe and floods your house.

Workers Compensation coverage

If contractors have employees, they must maintain Worker's Compensation insurance to cover injuries if they get hurt on the job.

That's important because anyone injured on your property, including paid contractors, can sue you for damages. Your PEMCO homeowners policy provides liability coverage (up to the limits you selected) and legal-defense costs. But unfortunately, it can't eliminate the worry, inconvenience and sleepless nights that accompany a lawsuit.

You're not in this alone 

If your project is part of an insurance claim, know that PEMCO's in your corner! If you have questions or concerns, talk to your PEMCO adjuster or call 1-800-GO-PEMCO.

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