Residential landlords and property managers need to use licensed and insured vendors when work is being performed at a rental property, and there are legal and practical reasons to explain this. It's a requirement of the Arizona Board of Technical Services that all vendors are licensed when work is performed that's $1,000 or more. The Commissioner of the Department of Real Estate has reinforced this requirement for all Realtors and property managers in Arizona. But the real reason to hire a licensed and insured vendor isn't because of the law or the commissioner. It's for your security and protection.
Protection Against Property Damage
If an unlicensed vendor is working on your property and damages the house, you have no recourse except to go to court. That can cost you a lot of money and time, and there's no guarantee that you'll even win the case. If the vendors are licensed and they cause damage, we can go to the Registrar of Contractors to get relief. If the vendor is at your house and they damage the tenant's property, then we can also go to the Registrar of Contractors if they don't take care of their responsibility. The licensing protects you.
Liability Insurance
Vendors you choose to work with also need general liability insurance. That protects you if they do damage your house or a third party's property. You can file a claim against their insurance. If the vendor should do something illegal or harass someone, the insurance will step up and protect you.
Worker's Comp Insurance
You also want to look for vendors who carry worker's comp insurance. This is key because if a vendor is working on your roof and falls off a ladder, you could be liable for their care and living or medical costs if they don't have the right insurance. When vendors have worker's comp, you are protected. If it's an independent vendor like a maintenance technician or an HVAC contractor who is a one-person shop, they can opt out of worker's comp. But in these cases they have to have forms that will protect you and them.
Always work with vendors who are licensed and insured. It protects you and your property manager. As your manager, the last thing we want to do is send an unlicensed vendor to your property, because we have no way to protect you.
If you have any questions or concerns, please contact us at Foothills Properties and we'd be happy to discuss this further.
