When you hire a GC, subs, and other on-site workers, ask whether they have insurance coverage. Each should have a blanket policy that covers them—and you—in the event of personal or property loss. (Such policies are often referred to in shorthand as PL/PD for personal liability/personal damage insurance.) You don’t want to be at risk for a liability claim in the event of any personal injury or property damage. Be sure as well that the contractor has workman’s compensation to cover his employees in the event of an injury. Ask him to be sure that his insurance certificate cites the workman’s comp coverage, too.
Ask each contractor to provide you with a copy of his Certificate of Insurance together with his or her estimate. When you sign a contract, addend the copy of the contractor’s insurance certificate to the agreement, together with words to the effect that the contractor will not hold the homeowner responsible in the event of an insurance claim. Just to be safe, call the insurance carrier cited on the Certificate of Insurance to make sure the insurance coverage is in effect. If the contractor has missed a payment, the coverage may have lapsed.
If the contractor doesn’t have insurance coverage? Preferably, get another contractor. At the very least, discuss with your insurance broker adding construction coverage to your homeowner’s policy.
Change orders don’t have to be complicated, but if the job changes, then the change orders must be done. They are a key part of the paper trail you are creating in order to control your project.