If you are a general contractor, roofer, or even a home remodeler, there might be times when you need to hire a roofing subcontractor to assist you on a project.
The problem is that hiring this type of subcontractor has the potential to create more issues for your business than hiring someone from nearly any other trade.
Done improperly, a roofing project could result in significant increases in insurance premiums and a higher likelihood of a lawsuit that would affect both you and your client (the property owner).
What makes roofing particularly unique from other trades is the high frequency and severity of the claims, compared to many other types of construction businesses. Employees who work at heights are more likely to experience significant injuries; plus, making a mistake on the roof could lead to major infrastructure issues for the client, like water damage.
There are ways to almost completely mitigate this issue, though. Here are four tips to use when hiring a roofing subcontractor:
Tip #1: Have A Subcontractor Agreement In Place.
One of the critical elements of hiring roofing subcontractors, or really anyone, is to have a subcontractor agreement in place that lays out their responsibilities and liabilities. These points can include:
Outline of work performed
Hold harmless agreements
The goal of this contract is to agree, in writing, who is responsible for each issue and what the subcontractor is required to do when working for you. For example, in most subcontractor agreements the subcontractor will accept all liability for the work they perform and hold the other party harmless in the event of an accident.
This is your first line of defense in a legal issue with a subcontractor and something you should definitely review with an attorney.
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Tip #2: Make Sure The Roofing Subcontractor Is Insured (& Collect A Certificate Of Insurance)
After creating a subcontractor agreement specifying that the roofing subcontractor must be insured, you need to verify this by collecting a certificate of insurance.
This certificate will show the expiration date of the subcontractor’s policy, the insurance company, and the limits for each policy. If you are worried about exclusions, it is common to ask for the subcontractor's declarations page to verify the quality of the insurance policy.
Tip #3: Get Added As An Additional Insured On The Subcontractor’s Policy.
You should always request to be added as an additional insured on the roofing subcontractor’s policy. This request is usually included in the subcontractor agreement, but if it isn't, you should ask for it separately.
This additional ensured endorsement makes the subcontractor’s insurance policy pay for legal liabilities that arise from the subcontractor's negligence while working for you.
Having all your subcontractors, and especially roofers, add this endorsement is another barrier between you and potential liabilities.
LandesBlosch Additional Tip: We suggest requesting both the CG 2010 (Ongoing Operations) and CG 2037 (Completed Operations) additional insured endorsement forms. This names you as an additional insured for incidents that happen while on the job site, as well as liability that arises after the project is complete.
Tip #4: Use Vetted & Experienced Roofers Only.
One of the best ways for businesses that subcontract roofing work to lower risk is to hire an experienced, reputable roofer and use them repeatedly, instead of using different roofing companies for each project.
This allows you to trust a team to deliver quality work in a safety-first job site, lowering the chances of any employee injury or lawsuit. If you tell your insurance company that you are hiring the same subcontractors over and over again, it might actually lower your insurance premium, too.
Hiring a roofing subcontractor can seem like a complicated ordeal, but you only have to set up your procedures once to protect yourself and your business from a significant amount of legal hassle.
Whether it be a large insurance audit resulting in a $10,000+ additional premium, or a lawsuit that could have been completely avoided, implementing these tips can save you money and time in the long term.