Learn what licensed and insured means and why it's best when hiring a contractor in Florida.
Licensed and insured. These are ubiquitous terms found on most service company advertising, but what do they mean? Why should you care? An educated consumer makes better decisions. It’s important to understand what it means and why it’s important when hiring a contractor.
What "Licensed' Means in Florida
The state of Florida requires both residential and commercial builders and contractors to be licensed. There are separate licensing requirements for residential contractors, mechanical contractors (plumbing, electrical, HVAC) and general contractors. All are licensed through the Florida Construction Industry Licensing Board (CILB), which also requires licenses be kept current.
Homeowners can confirm a contractor's license is legitimate and current by visiting the state's website. Select “Verify a license,” and then search by license number or contractor name.
The CILB also administers the Florida Homeowners’ Construction Recovery Fund. If you lose money on a project performed under contract where the loss results from specified violations of Florida law by a licensed contractor, you may be eligible for payment from this fund. If you choose an unlicensed contractor at your home or business, you have no rights under the statute that created this fund.
What 'Insured' Means in Florida
There are two types of insurance on which to focus when selecting a vendor.
Workers’ compensation insurance protects homeowners from liability for injuries incurred while workers are in their homes or on their property. If somebody is injured working in your home and is not covered by a workers' compensation policy, you might be responsible for their lost wages and medical costs.
General liability insurance protects the homeowner from bodily injury, property damage or personal injury. In the event there would be damage or loss to a home or structure due to a contractor’s negligence, your homeowners' property insurance won’t likely cover the damage. Most policies explicitly exclude damages caused by contractors. It would be necessary for the contractor’s general liability insurance to cover this damage. If the contractor is not insured, you are at risk.
There have been instances where companies claim to be licensed and insured, and it comes to light after an incident that they have a business license and auto insurance on their work vehicle. Neither offers the homeowner any protection in the case of an injury or damage to your property. While the license is issued by the state, the insurance is backed by an insurance carrier. Contact information for verification purposes is listed on the insurance certificate, as is the expiration date of the policy.
Asking to see the license and certificates of insurance is your best protection. Reputable companies are happy to provide proof of adherence to laws and regulations designed to protect both you and them. Contractors that cut corners on licensing and insurance and put that risk on you are much more likely to cut corners when working at your home.
About this Experts Contributor
Mike McCalley owns and manages Mr. Handyman, which serves greater Jacksonville, Florida. Mr. Handyman was founded in 2000 and has served greater Jacksonville since 2006. It is a fully licensed and insured general contractor service focused on your home repair, home improvement and home maintenance needs. Mr. Handyman technicians are employees, not subcontractors. Each has been background and drug screened and has a minimum of 15 years of paid experience. All work is backed by a one-year service guarantee.
As of June 28, 2011, this service provider was highly rated on Angie’s List. Ratings are subject to change based on consumer feedback, so check Angie's List for the most up-to-date reviews. The views expressed by this author do not necessarily reflect those of Angie’s List.