The sticker price on a quality remodel can be shocking.

After labor, insurance, supplies, and other incidentals, the tally can rise much further than you’d hoped. Because of these factors, it can be tempting to cut corners. On smaller jobs in particular, you might be thinking about hiring a freelancer to tackle your project at a fraction of the cost of the other guys.

Without commission, insurance fees, and the like, this option is attractive, but it could also be disastrous for your project and your finances.

What Is an Independent Contractor?

Put simply, an independent contractor is someone who provides a service for others but who is not a legal employee of the person who hired them. Just like with a regular home service, written or oral contracts are normally agreed upon by both parties.

When you hire an independent contractor, though, you are not only their customer but also their employer.

Unlicensed, independent contractors often claim that they can take on almost any home improvement task, from pressure washing your driveway to a full-scale kitchen remodel. In reality, however, their skill level will likely vary significantly from task to task. The same person who is an ace with a pressure washer may be terrible at patching drywall.

Your home is one of your largest, most significant investments—hiring a licensed contractor who will do any improvements well is worth the higher cost.

Read on to learn about three major risks of taking on an independent contractor.

1. You Take on Liability

close-up of man with neck painInsurance is one of the major reasons that a regular company’s estimate looks so high.

Unlike an uninsured contractor, the best contractors have liability and workers’ compensation insurance—when required by the state—in case of on-site accidents. Without insurance, liability and the bills that follow fall on the homeowner.

That’s you.

Something as simple as a bump on the head or as serious as a back injury could end up costing you more in the long run than you’d ever spend on a licensed, insured contractor.

2. There Are No Guarantees

close-up of two men shaking hands“You get what you pay for” is a popular adage, and it works both ways. Many high-quality home service companies have higher estimates, but you can feel comfortable that the quality of the work will be great.

On the other hand, while many of the workers contracting as independent laborers have experience in construction or home improvement, skill level comes down to the luck of the draw.

When hiring an independent contractor, you probably won’t be able to check references or verify ahead of time that a worker knows what he or she is doing with your project. This might be all right for small projects, but it could cause problems on anything complex. 

3. Their Word Is Their Only Bond

angry man on phone next to woman doing calculationsHiring contractors who aren’t licensed, insured, or bonded means that there’s little you can do if you’re unhappy.

Bonded laborers have insurance in place that can pay to replace or repair incidental damages and issues.

Without these safeguards, you’ll have to work long and hard to get any recourse for a botched job. It’ll take more time, money, and energy than you ever intended, and there is no guarantee you’ll see a resolution.

At best, when you hire an unlicensed, independent contractor, you could end up with an expert who does your project well; however, you’re at constant risk of being held liable for on-the-job injuries and accidents.

At worst, hiring an unlicensed contractor could not only ruin your project but also create problems that cost you money, put your home at risk, and cause you stress. It might seem tempting to cut costs, but the results could be catastrophic.

There’s an obvious lesson here: protect your investments by hiring a fully licensed and insured contractor.

Best Pick Reports verifies all licenses and insurance—every year—for the companies listed on our site and in our guide. It’s something we find very important, and we know it’s a big deal to you, too. Browse our recommended home service companies the next time a project comes up, and we know you’ll feel confident about the outcome.