How to safely pick a good contractor for your home improvement project or repair work. Almost every form of advertising from a contractor, whether it be simply their vehicle signage or phone book advertising, you will repeatedly see the cliche phrase "Licensed, Bonded and Insured". Do you as a consumer actually know what each of these words mean and how they can affect you. You BETTER! Well let me explain it to you! First off, I own a legitimate plumbing company. I know these terms well, and a lot of my competition exploits these terms. This bothers me since I run a legitimate company and am actually LICENSED, BONDED and INSURED - These words - come at a substantial cost to those of us who run legitimate businesses and actually meet the requirements to take care of our customers. This article is slanted toward plumbing contractors, since I am in the plumbing business and understand plumbing contracting - but, it is relevant to ALL other forms of contracting. First - Being Licensed can mean many, many things. So if your plumber says that he is licensed what does that mean? Does he mean that he has a drivers license - HA :-) a lot of good that will do you. Does he have STATE ISSUED PLUMBING LICENSE, or a local business license or both? Well if he is legitimate he will have a state issued plumbing license, and a local business license. He should be able to produce these items upon request and you can call you local municipality to check his business license status. You can also call your state plumbing or contracting board to verify the status of their license. Second - Bonded -- What does being bonded mean? Well there are several forms of "bonding". For instance in my service area, which covers approximately 15 different municipalities , I am only required by 2 of those municipalities to actually have a bond on file with the jurisdiction/city. Here is the real KICKER - the bond for the year is only for $10,000.00! If a customer had to challenge ME or the CITY on a job that was messed up they could only claim up to $10K of damages (the amount of the bond I bought). That naturally will not cover much damage! Remember that I am not even required by the rest of my service area to supply any type of bond! We as a legitimate company carry a separate $1 million dollar bond through our Insurance agency. Most of the established companies do this also! Your contractor should willing give you proof of his bond - if he really has one. LASTLY - INSURED -- humm, sometimes the vehicle the only thing insured - HA, a lot of good that will do you if there is a problem with the work, your house floods out or burns to the ground! Proper insurance (General Liability Insurance) should be at a MINIMUM of $1 million dollars with an UMBRELLA (EXCESS PER OCCURANCE) of at least the policy minimum ($1MILL in this case) or in most cases double the base policy coverage. Having this insurance is expensive and many contractor do not have it. They can skate by and never get caught. You as the consumer should only deal with contractors that actually are Licensed, Bonded and Insured. You may end up paying a slightly higher bill - but you will be covered if a problem occurs. If a contractor actually goes to the lengths to meet all of the afore mentioned qualifications he will probably take very good care of you - it is in his best interest. Thank you for taking time to read this article, hopefully it be of help to somebody! Wes Hamilton, PLUMB PRO, INC http://www.plumbpro.net/ http://www.plumbproinc.com/