Use Caution When Hiring A Subcontractor & Get Insurance Through an Independent Insurance Agency in Chicago, IL

May 26, 2016

Protect yourself with insurance from an independent insurance agency in Chicago when hiring a subcontractor.

When hiring a subcontractor, it’s important to do your homework. By definition, a contractor is a self-employed person that is hired to carry out a specified task. Since the subcontractors are considered to be self-employed, they then must pay a self-employment tax through a 1099 form. Keep in mind that companies will hire employees as contractors to avoid paying employee taxes. However, as an employer, hiring a subcontractor puts your business at risk for liability claims. Ensure that you get the right commercial liability insurance through an independent insurance agency, and check out what you should look into before you hire a subcontractor.

Conduct a Background Check.

When looking for a subcontractor, check up on their past projects. If there were any projects that were poorly done, think twice about hiring that person. It’s possible that their errors may fall on your shoulders if it comes down to a liability suit. Prevent any issues and hire an experienced and insured subcontractor.

Ensure They Have Professional Liability Insurance.

Liability can be an issue when working with clients. Ensure that both your business and any subcontractors are covered by professional liability insurance. Before hiring your subcontractor, look for proof of insurance and request to see their certificate of liability insurance.

Establish a Written Agreement.

Contracts are important when hiring new talent. When entering into an agreement with an employee or contractor, ensure that you have a written contract. Outline the terms of your agreement and make it clear what each party is responsible for including liability. Consult with a lawyer to make sure that your contact follows all legal obligations.

When hiring a subcontractor, make sure you’re protected from liability with the right commercial liability insurance. Have an expert independent insurance agency in Chicago, IL, help you find the right policy! Located in Illinois, Gulbransen Insurance Agency serves all your personal and commercial insurance needs. Contact us for more information.