Insurance/Legal Matters in Restoration

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As I sat at lunch with a restoration contractor, the familiar story unfolded: “I did the Cat 3 water loss according to the IICRC S500 and the adjuster only wants to pay me for a Cat 2 loss.

Most restoration contractors have glaring coverage gaps in their liability insurance resulting from professional exclusions.

Covering your backside is as much art as it is science.

As discussed in Part I of this series, which appeared in the October issue of R&R, a contract is an agreement voluntarily entered into by two or more parties with the intention of creating a legal obligation. Moving on from the basics, here we will discuss home improvement laws and the most important legal provisions for any restoration contract.

One gloomy morning in 2010, major water damage inundated an upscale Los Angeles residence owned by an unscrupulous and wealthy entrepreneur. He contacted a prominent restoration contractor and signed a generic Work Authorization which did not specify the scope of work or the price.