Licensed, Bonded & Insured and Other Contractor Considerations

What does licensed, bonded & insured mean? What are the contractor requirements in Texas? Do the definitions vary from state to state? Should the contractor handle the permits? These are the types of questions that many homeowners have when they begin looking for a deck builder. Who you choose to work with is an important decision, not just for your budget but also for your safety.

Keep reading to get answers to common contractor questions and to learn a little bit more about what homeowners should consider before hiring a contractor to build a deck.

contractor considerations

What does licensed, bonded & insured mean?

The term licensed, bonded & insured is frequently displayed on marketing material, but the meaning can be a little fuzzy for those who aren’t in a trade. Simply put licensed, bonded & insured means:

  • The contractor has met minimum requirements to perform specific work and received a license. They can be licensed by the state where they own their business, a local entity or a trade organization. However, it does not mean a person has a business license.
  • Bonded means that they either have a general bond or a bond for a specific job that covers the customer if the contractor were to go out of business, fail to finish the job or become unable to finish the job. The business that issued the bond would then cover the customer if there were any financial loss. Bonds are for a certain amount, which varies from profession to profession.
  • When a contractor states that they are insured this refers to liability insurance that covers them in the event there is an accident or damage occurs during construction.

Just because a contractor advertises that they are licensed, bonded & insured doesn’t make it a sure thing. Ask them to provide additional information and follow up on all three to verify that they exist.

What are the contractor requirements in Texas?

The Texas Department of Licensing and Regulation is in charge of setting requirements and licensing for professionals in 26 industries throughout the state. Contractors like electricians are licensed through TDLR, however deck contractors are not required to have licensure through the state.

But that’s just part of the equation. Some cities and municipalities have their own licensing procedures and may require that contractors have a license. Other credentials to look for include formal education in studies like construction technology or civil engineering, a degree from a trade school or coursework at a technical college. Again, this isn’t a requirement, but given the lack of state regulation it’s a good idea.

Do the definitions vary from state to state?

The general definitions for things like licensed, bonded & insured are largely the same across all states. However, each state determines their own licensing requirements for contractors and may have specific definitions for construction-related terms.

Should the contractor handle the permit process?

When you’re building or replacing a deck permits are almost always going to be required. It’s a process that needs to be started before construction begins and includes getting permits issued, setting up deck inspections, submitting a building plan and more. There are no set guidelines for who must handle the permit process. Anyone who is associated with the permit can schedule inspections, get information, etc. Essentially it just needs to be done.

Your contractor should be more familiar with acquiring building permits, however, because it’s your property ultimately it’s your responsibility to have them. Discuss the matter with contractors up front to determine who will be in charge of securing the permits. If anything they can provide helpful advice that makes it easier for you to handle it on your own. Contact your local permit center to get specifics on securing permits in your area.

Quick Tips for Finding Deck Contractors

All reputable deck contractors will have three things:

  • Examples of their work
  • References/referrals
  • Good working relationships with local lumber suppliers

If a contractor doesn’t have all three keep looking. Once you’ve found the contractor you want to work with get a detailed write up of the work that will be done and the costs in a contract. Come to an agreement about how payments will be made, but never agree to pay the entire amount up front.

Homeowners are always welcome to come by Timbertown Austin for additional advice and contractor recommendations for professionals in Central Texas.

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