Insured.Licensed.Bonded - What does it mean to your project bottom line?

Insured. Licensed. Bonded.You have heard those words thrown around in the construction industry for so long and yet are not really sure what any of them mean. Let’s take a look at what each of these terms mean, how to determine if your contractor is required to have specific qualifications, and the ways in which to discover if they are truly qualified Insured. Every person who does any type of work in your home needs to have insurance. There are no ifs, ands or buts about it. What type of insurance? Minimum amounts required by the state of Florida for General Liability insurance for General and Building Contractors are $300,000 public liability and $50,000 property damage. Ensure that anyone you hire has at least this minimum coverage. If they have employees, they are required to have worker’s compensation insurance. Prior to hiring anyone to work on your project, request a certificate of insurance listing you as a certificate holder. *If the potential contractor is not willing to provide this information, end the conversation immediately*

Licensed. This is the BIG one! Far too often, companies that are not required to have state licensing advertise they are licensed. Another trick is calling a Business Tax Receipt an Occupational License. Not all work requires a license from the state, but you do need to check with your local building department on local licensing requirements. Someone who is properly licensed (meaning they took an excruciating exam with 100+ questions, had a background check, and provided a credit report on the application) will be able to provide a DBPR license number. If they cannot do that, they are not licensed through the state. This does not mean you shouldn’t hire them because they may not require a license. *If they are not required to have a license, yet tell you they have a license, end the conversation immediately.*

Bonded. For private, residential construction, a bond is typically not required. A bond will basically pay another company to come in and complete a project when the first company cannot perform. These are typically required only in public projects or large commercial projects. Bonds are purchased individually for each project. If you are looking to hire someone for a residential project, they do not need a bond. Keep in mind that bonds are often expensive and the cost will be passed onto you in the bid. If you are not sure if someone is required to have a state license or want to verify, send me an email and I will be happy to help you!

Contractor Sarah Keener is the CEO of Sarah Keener Builders, LLC. For more information on this topic email Sarah at









Sherrie Long