Your last renter has just moved out, and it’s time to get the place deep cleaned so you can start showing it to prospective tenants. Because it’s a big job, you hire a cleaning company to come in and scrub the place from top to bottom. After the job is done, you inspect their work and find large, mottled discolorations on the living room carpet: the maintenance crew used a chemical that bleached out the color. You call and demand that they pay for the mistake, but they deny responsibility. Over the course of the call, you discover that the company is not insured, and you now have two options: pay for the damage yourself, or take the company to court. Neither option is ideal; both are expensive. How could this have been avoided?
The answer is simple: if you own a rental property, never hire a maintenance company of any kind that does not have insurance. You as the owner have insurance to cover costs of unexpected problems in the home—you do this to protect yourself financially and to maintain the home for your renters. Expect the same from companies that you hire to clean, do repairs, or remodel. Hiring a company without insurance and letting them come into your home to work is like giving a child a box of matches and hoping he won’t get curious: you’re just asking for trouble.
Not only do you want to cover potential damages to your property, you want to be assured that any injury sustained by maintenance crews is covered by the company. Say you hire someone to fix a leaking roof, and while the crew members are working, one falls. If the company is not insured, they may file a lawsuit against you. Or, if a worker damages the neighbors’ property, the neighbors’ may take legal action against you and not the company.
Companies that don’t have insurance are usually small, and can easily avoid the costs of accidents and injury. Why? They can close their business and start over somewhere else. You, however, have an investment that can’t be moved, and coming after you is the obvious solution to injured parties’ problems.
Do your homework before hiring a company. This isn’t suggesting that you should be paranoid about anyone fixing your property. Rather, be informed about who is coming to work for you and what you can potentially be liable for. Before making a deal, ask for proof of insurance. Companies that have it will most likely comply willingly, because they have nothing to hide. Once you know a company is insured, you can confidently let them do their work, without worrying that something will go wrong.