Well 64% of those responding to this month's Poll .. DO NOT ask or get any proof of insurance from the contractor they hire! I have 2 words for you....BUYER BEWARE! I know that you are not going to ask every contractor you hire, like a furnace cleanout service, for proof of insurance, but when you are doing any substantial home improvement project, my advice is that you do.
In the State of Michigan (like most States), if any of the contractor's workers are injured, and the contractor does not have any or enough coverage, you the homeowner, can be held liable. This falls under the "Buyer Beware" laws. If a worker is seriously injured on your property, a good lawyer is going to seek damages , not only from the contractor, but also from the homeowner.
I advise that you request a copy of the contractor's Insurance Binder (a summary page of coverages) prior to signing any contract. I would wait until you have made a decision on which contractor you are going to use from the bids you received. When you call that contractor to proceed with the bid, ask them to supply a copy of insurance at the time you sign and place the deposit. If you want to test the contractor's to see if they follow instructions, you can request they supply one with their respective bids, not just a line in their fine print that says they are "insured". You can use this factor to eliminate any contractors that do not follow your simple instructions. All honest and reputable contractors will have no problem performing this task, it's just good business!
The most important coverage for you to inspect is the contractor's Workman's Compensation coverage. This is the insurance that covers any worker's injuries. Liability coverage is also important because this will cover any damages to your home or property. Most contractor's carry Umbrella coverage which is additional dollars that can float to any of their insurance coverages if needed.
In the home improvement, landscaping, contracting industry, make sure that their minimum Work Comp coverage is 1 million. Most established and reputable contractor's have this easily as a minimum. Liability coverage of $500,000 or more is exceptable. Most cases this is plenty enough to cover any home or property damages. The Umbrella amount is extra coverage that will "float" to add more dollar coverages to Work Comp, Liability, etc.. so this amount, added to the other dollar amounts, is the true amounts of coverage.
So, do not take your "liability" for granted next time unless you plan on climbing the ladder, placing the shingles on the roof, digging holes for trees, or splicing the wires.