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Cleaning and repair companies often advertise that they are “fully insured and bonded” — but what does this really mean and are YOU really protected from potential liabilities when someone works in your home?

The market is flooded with companies that carry inadequate insurance to save money and gain a competitive advantage.  Unfortunately, homeowners are often unaware that the savings they receive from hiring an “underinsured” low-bid company exposes them to much greater risk of personal liability if a worker is injured or injures someone while in their home.  We’ll look at the three types of insurance coverage any service company must have and what you should require to protect yourself from unforeseen liabilities.

General Liability – this insurance provides coverage for any damages to your property or for injuries caused by the company or its employees.  It is a primary line of insurance coverage that all businesses should have – with limits of at least $2 million.

Worker’s Compensation – Workers Compensation provides payments to injured workers for time lost from work and for medical and rehabilitation costs arising from an accident.  In the State of Georgia, employers are NOT required to purchase workers compensation coverage if they have less than three employees.  So if a company has less than three employees, or uses sub-contractors (not technically employees), they have no legal requirement to purchase workers compensation coverage, which is the most expensive insurance for most companies — costing as much as 15% of the company’s total payroll!

To save money and gain a competitive pricing advantage, many cleaning companies do not purchase workers compensation.  BEWARE!  As a homeowner, you are assuming considerable risk of being sued if you hire a worker that is not covered by workers compensation.  Even though you are not the worker’s “employer”, if he is injured at your home and his employer does not have workers compensation coverage, some courts have found the homeowner to be liable!  To make matters worse, your homeowner’s liability insurance does NOT likely cover medical and lost wage costs for employees working in a home.

Fidelity - this insurance is also commonly referred to as “crime insurance” or being “bonded.”  It provides coverage for losses arising from theft, fraud or other forms of employee dishonesty.

Insurance Certificate - before beginning any work in your home, a service company should provide you with an official “Certificate of Insurance” as evidence that they have the necessary insurance and adequate limits of coverage.  And don’t assume that big name franchise companies must have coverage because they are a household name.  CHECK.  As an example, you can look at the Q Care insurance certificate at www.qcare.com/about-qcare/our-insurance/

Be sure to protect yourself from unforeseen liability; require any worker in your home to provide proof of proper insurance!

Chris Callas is President of Q Care, Inc.  QCare is a full service cleaning company specializing is carpet & upholstery cleaning, window cleaning, hardood floor refinishing and pressure washing.  Chris can be reached at (770)594-1836 or on the web at www.qcare.com