What to Know About Filing an Insurance Claim Against a Contractor

You’re finally checking that long-awaited home improvement project off your to-do list. But your contractor accidentally left your water running and caused water damage to your beautiful hardwood floor. Can you file an insurance claim against a contractor for negligence?

Learn more about the types of claims you can file against a contractor, how to file, and how to hire the right pro for your next home project.

What Types of Claims Can You File Against a Contractor?

Most states require contractors to carry general liability insurance at a minimum. This insurance policy covers property damage or injury to third parties for which the contractor is found liable.

Property Damage

Contractor general liability insurance covers property damage caused by the contractor. For example, the following situations would warrant you filing a claim with the contractor’s insurance:

• Your contractor accidentally knocked a large hole in your wall while installing a new kitchen.

• Your contractor installed a plumbing line incorrectly, causing a water leak that damaged your floors, walls, and furniture.

• Your contractor accidentally broke a window with their ladder while installing new siding on your home.

Injury

General liability insurance also provides coverage for third-party injuries. Some scenarios in which you could file a claim with your contractor’s insurance include: 

• Your contractor didn’t secure the boards properly when installing a deck, and you fell through the deck and broke your leg.

• Your contractor left a ladder unsecured. The ladder fell and hit you on the head, causing a concussion.

• Your contractor dropped a tool while fixing your roof, and the tool landed on a passerby and caused injury. The passerby would file a claim with your contractor.

How to File a Claim Against a Contractor

If you think you have just cause to file a claim, there are several steps to follow to start the process.

1. Speak to the Contractor

The first step should be to speak with the contractor about the issue. They may be willing to fix the damage or pay the medical bills out of pocket to avoid filing a claim and increasing their insurance premiums.

But if you decide to proceed with a claim, the contractor will likely need to start the process themselves.

2. Provide Evidence

Next, you’ll need to provide the contractor and their insurer with evidence of the damage or injury. Take photos or videos of any damage and estimate the value of the damaged items. If you still have receipts, make copies and include them when filing the claim. Provide copies of medical bills related to any injuries mentioned in the claim.

3. Check Your Homeowners Insurance

You may be able to file your claim through your homeowner's insurance policy. If your insurer approves the claim, they may seek to recoup their losses from your contractor’s insurance provider. This process is called subrogation.

4. Receive Payment

Once the claim is approved, you should receive payment fairly quickly. To ensure a speedy payout, stay in touch with the insurer throughout the process so you can help resolve any issues or inconsistencies quickly.

Tips for Hiring a Trustworthy Contractor

Researching and asking questions is the best way to ensure the contractor you hire is legit. Here are some tips for hiring the best contractor for your project.

• Ask whether the contractor has a valid license and verify their license number with your local licensing agency.

• Request a Certificate of Insurance (COI) to check the contractor has liability and workers’ compensation insurance coverage.

• Request a Certificate of Bonding to check that the contractor has a surety bond.

• Read online reviews, check Better Business Bureau (BBB) listings, and contact references to vet the contractor before you hire them.

• Request project quotes from at least three contractors before choosing one.

• Check the contract for the estimated project timeline, payment terms, and any guarantees or warranties offered.

• Ask whether the contractor and crew members will perform the work or whether they will use subcontractors.