What Insurance Does Your Contractor Need For An Extensive Outdoor Renovation?

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If you've recently decided that this year will be the year you undertake an extensive and long-anticipated landscaping project -- from building a larger deck or patio area to installing a koi pond or large garden bed -- you may be wondering where to begin. The key to success when starting out on a large project is to begin planning early, and this can include applying for the necessary permits, having electrical and gas lines tagged, and reviewing your insurance coverage. But how can you ensure that your landscaping contractor is protecting themself as well? Here is more about the insurance you should ensure your landscaping contractor is carrying, as well as the insurance coverage you may need in order to protect your own assets if a worker is injured while performing work on your property. 

What type of insurance coverage should a landscaping contractor have?

Depending upon the size of the contractor's business and the laws in your state, the contractor may be required to carry workers' compensation insurance on any employees or subcontractors. This insurance is designed to protect these workers from the expenses and lost wages they may suffer from an on-the-job injury without requiring the employer to bear all the costs of these injuries.

In other cases, the contractor may only carry insurance to protect the company from lawsuit, not necessarily the employers. If this is the case, workers who are injured on the job may instead file a lawsuit against you (or your homeowner's insurance company) rather than attempt to pursue a lawsuit against the contractor, which makes this a much riskier proposition for the homeowner. 

Before engaging a landscaping contractor, you'll want to make sure he or she carries enough liability insurance to compensate employees or contract workers for any injuries they could incur while performing work at your home. This may mean state workers' compensation coverage or an additional liability policy that allows for medical payments.

What insurance coverage should you pursue before landscaping work on your home begins? 

Even if you've ensured your landscaping contractor carries sufficient workers' compensation or liability insurance, it's not a bad idea to review your own coverage, especially if you're making an addition to your home that's likely to increase your resale value (and your cost to rebuild). In some cases, purchasing an umbrella insurance policy can provide you with the added protection from lawsuit by providing coverage in excess of your homeowner's liability limits.