It is no secret that the Monterey Peninsula area is a very desirable place to live. All one needs to do is quickly peruse the Real Estate section of the local newspaper to see how much people are willing to pay to live here. Homes here are expensive, and the cost of maintaining and improving them is expensive as well. So, it is a natural tendency to want to save money when faced with the need for a Licensed Contractor to remodel your kitchen in Carmel, build an addition in Pebble Beach, or renovate your recently purchased cottage in Pacific Grove. It is a common belief that one can save money by hiring an Unlicensed Contractor to do the work, and for the most part, it’s true. But like gambling, the higher the potential payoff, the higher the risk, and most home owners don’t consider the risk and myriad of possible and very real problems when hiring an Unlicensed Contractor.
The reason that Unlicensed Contractors can charge less for comparable work is because they don’t follow the rules; rules that are intended to protect homeowners from unscrupulous and unqualified people. This is not to say that all Unlicensed Contractors are unscrupulous and unqualified, nor is it true that all Licensed Contractors are the opposite, but Licensing provides verification that an individual has at least met some minimum qualifications. But what about risk? Risk is a four letter word that can’t be eliminated; only passed around like a hot potato. Licensed Contractors are required to maintain liability insurance, workers compensation insurance if they have employees, and carry a minimum performance bond to guarantee that the job will be completed, and the work is done properly. This insurance and bonding not only protects the Contractor, but also protects the client, by passing the risk to the insurance carrier. In most cases unlicensed contractors carry no insurance and are un-bonded, which means that the cost of doing business is lower.
Home improvement work is a very risky business. Power tools, electricity, ladders, heavy materials, and toxic or dangerous materials are all very real risks to people working in and around construction. If you put two or more of these things together, such as power tools and ladders, the risk goes up exponentially. There are other risks as well. The risk that the work will be done improperly, that a job will be abandoned and never completed, or that a third party, such as a neighbor, or other person will be injured as a result of negligence on the part of the contractor. These risks exist whether the Contractor is licensed or not, and are always there. The difference is that with a Licensed Contractor, they assume the risk, and with an Unlicensed Contractor, you do.
In the state of California, if you hire an Unlicensed Contractor, they become YOUR employee in the eyes of the law. If the Unlicensed Contractor has employees, guess what? Yep, they are yours too! This means that if one of them cut’s off a thumb while using a table saw, or severely injure an eye, it is you who is responsible for their medical bills and lost wages. Hopefully your home owner’s insurance policy will at least partially cover a portion of this expense, but good luck finding a new insurance carrier once your policy has been cancelled when your current policy expires. If your home owner’s insurance doesn’t cover the injury, expect to be served with a law suit filed on behalf of your unlicensed contractor or their employee. Oh, what…..your employee.
These are just a few of the risks associated with using an Unlicensed Contractor for home improvement projects, and there are many others. Even if you hire an Unlicensed Contractor that is honest and well qualified, the risks are still there; only you are the one stuck holding the hot potato, and it is very real and very hot. So the next time you are considering an Unlicensed Contractor for a project, consider the words of one of Carmel-By-The-Sea’s most famous celebrities….
“You’ve gotta ask yourself a question……Do I feel lucky?”
If the answer is NO, just call Bakker Construction at (831) 998-7113.