CONTRACTORS, CONSTRUCTION CONTRACTS

AND COURSE OF CONSTRUCTION COVERAGE

Church construction is a healthy sign of growth for any congregation.  It is also a time to use common sense and caution when entering into a contract for original construction, expansion or remodeling of church buildings.  After the decision is made to work on a building, an architect or engineer has completed the plans, and appropriate permits have been secured, you are ready to retain a licensed contractor to do the actual work.

Occasionally a contractor who is a member of the congregation may offer services.  Often that contractor will do quality work, and at affordable prices.  But it is appropriate to ask for bids from more than one contractor, and always wise to have a signed contract whether the builder is a church member or not.  Experience has taught many churches that accepting the offer of a ‘handyman’ or ‘volunteers’ to ‘help the church’ by doing the work is not the wisest decision.  Saving the church money is a commendable idea, but not if there’s no contract, no liability or worker’s compensation insurance, and no performance bond.   It is better to hire the correct contractor, pay a fair price, and protect your church by insisting on a contract!

Read the contract thoroughly! 

These are items to look for:

Does the contract ask your church to name the contractor as additional insured?  Your CPIP policy does not allow that wording.  Negotiate the contract to make clear that the contractor has responsibility for all work done, and coverage to cover accidents or job negligence. 

Does the contract ask your church to be responsible for tools used on the job?  Your CPIP policy does not provide that coverage.  The contractor’s insurance must be responsible for and pay for theft or destruction of their tools.

All contractors, including handymen volunteers, must have their own insurance and provide a Certificate of Insurance naming your church as additional insured!  Heffernan Insurance Brokers is available to review construction contracts, prior to signing.  Heffernan cannot and does not provide legal advice.  But they can advise you if the contract’s insurance provisions are adequate, or need to be renegotiated and rewritten.

Course of Construction Coverage   If you are planning construction of any size, notify Heffernan Insurance Brokers promptly.  Your existing buildings and all materials that will become part of the future structure will be covered during the entire course of construction, please complete Course of Construction Questionnaire. That CPIP coverage is how “Presbyterians protect Presbyterians!”