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Discussion Starter · #1 ·
Hi,

I'm new to the forum.
I have been doing residential painting and wallpapering for awhile and have been wanting to get into construction painting and post-construction final clean-up. A neighbor, who happens to be a contractor, recently offered me a job painting a house he built- I'm meeting him this afternoon for an estimate. He also may have me do the final cleanup, and he has another house that will be ready around December. It's great to all this work (word of mouth travels fast) but here's my dilemna:

I wasn't expecting to have job offers so soon and I don't yet have insurance, nor am I bonded.

What type of bond is best for this kind of work: 'Performance' or 'maintenance', etc ? where can I find a list of companies that offer bonds?

Also, is liability less expensive through 'personal' or 'business' insurance?

I spoke with Worker's Comp. and they gave me some forms ('joint agreement' & 'independent agreement' for contractors & subs) for including/excluding me on their worker's comp which would at least put a contractor's mind at ease.

The contractor who offered the work hasn't asked me if I'm bonded/insured, and I don't expect he will -he just seems concerned with getting the house finished, but I still need to get this taken care of soon for my own sake.

Any advice is greatly appreciated.
Thanks in advance.
Chell
 

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hello Chell

The insurance that you should be looking into is Business liability.

You may also need workman's comp insurance since the builder will not want to have you making claims against their policy if any thing happens.

The bond is Fidelity (theft) and that is normally only needed if you have employees

BTW - I have heard horror stories of people waiting for long times for their money while the corp offices/ builders hold it hostage in turn for the proof of insurance that they would of collected up front. Don't let the builders rush to get someone in to do the work cause you to stumble and have to jump thru hoops in order to get paid
 

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Discussion Starter · #3 ·
T,

Thanks for the reply/info.
I've been checking out online companies for quotes all day-I did get one quote for $750 and should recieve more calls tomorrow.

Texas is the only state where workers comp isn't mandatory, but I prefer not to play that game even if I could get the work w/out it. My husband had a bad experience with a past employer who didn't have comp and because of the wierd comp laws here, the employer didn't have to pay for anything and my husband lost the job while still recovering from the injury.

According to one ins. co., many of them don't offer it to small businesses/individuals (because its not mandatory) and therefore I may have to go through the Texas Mutual (formerly TX state comp fund) to get it.

I can what you mean about having to wait for the paperwork to clear at a company's main office before getting a check - that hadn't crossed my mind.

Thanks again.
Chell :)
 

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Discussion Starter · #5 ·
$750 for what amount of coverage? 1 mil? then you got a good quote if you ask me :thumbsup:

If W.C is not necessary in TX. you might want to look into a private disability policy instead for the time being.



Yes, the quote was for 1Mil. - sounded like a fair price to me too.

Disability may be something to look into, along with accident ins. Most builders here prob'ly won't give a hoot if sub contractors have comp anyway since the sub's a separate business. I'm not sure how well comp covers injuries here either - our laws are so tricky if one's employer doesn't have it ( in my husband's case, he hurt himself lifting a pipe -part of the daily job, to refuse would've gotten him fired. According to the laws, he 'chose' to lift it and take risk of injury. Had a pipe fallen on him though, the employer would have been liable for the injury. Kinda wierd, huh?!?).:blink:
Comp may not be worth having either, but I'm still going to look into it- I'll ask other folks around here with businesses & see.

Thanks a bunch.

Chell
 

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Discussion Starter · #6 ·
Hi T,

I called a few folks, including my bro-n-law who's a building contractor. He lives in LA now, but he's from TX.
The lowdown from him....

*Bus. Liability (1Mil) - safe amount/good quote.

*Without employees, comp's not needed (since it is more/less a liability type of ins. for employers). If a contractor does mention it, I sign a waiver.

*Disability/Accident ins. - just starting a business, working alone w/no employees, could make me look like a potential ins. fraud risk ( from an ins. agent's viewpoint), so it would prob'ly be hard to get anyway. Since my concern here is covering myself in case of injury, I'm better off sticking with plain ole health ins.

Geez, I feel like such a 'DeeDeeDee' :jester: I don't know why I didn't think to call the Bro' in the first place. (I musta thunk too hard & blown a circuit). I guess its just so easy to start a business here - no license required on state, county or city levels, comp, etc- that it seemed too good to be true & I was so busy double checking to be sure that I got myself all loopy. Its worth the embarrassment knowing I'm starting out correctly though, rather than risking trouble later on.

I really appreciate all your help. Hope I haven't been too much of a pain. But hey, I'm keeping all this info so if another newbie from Tx joins the forum, send 'em my way - I'll be happy to return the favor!

Have a great day!!
Chell
 

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Discussion Starter · #8 ·
Glad to hear that it is working out in your favor, here in Calif they want you to have everything + more to clean new home :mad:

DeeDeeDee - do I detect a Carlos Mencia fan? :thumbup:

BTW - good looking out for others, that is what makes these type of boards work so well :D


:yes: Yep, we like the Mencia-man!

Have a great day!
Chell
 

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A type of insurance policy that a bond issuer purchases that guarantees the repayment of the principal and all associated interest payments to the bondholders in the event of default. Bond issuers buy insurance to enhance their credit rating to 'AAA' in order to reduce the amount of interest that it needs to pay.

INVESTOPEDIA EXPLAINS 'Bond Insurance'
Once bond insurance has been purchased, the issuer's bond rating will no longer be applicable and instead, the bond insurer's credit rating will be applied to the bond instead. By design, bondholders should not encounter too much disruption if the issuer of a bond in their portfolio goes into default. The insurer should automatically take up the liability and make any principal and interest payments owed on the issue going forward.

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