What Are Some Financial Impacts That Have Been Seen by Not Using a Licensed Plumber?

Not using a licensed plumber for water heater installations and repairs can lead to significant financial impacts, especially in multi-family properties.

 

Some of the key financial risks include:

Costly Repairs Due to Poor Workmanship

Unlicensed plumbers may lack the necessary training or experience, leading to improper installations or substandard repairs. This can result in recurring issues, requiring additional repairs, and increasing long-term maintenance costs.

Higher Insurance Premiums or Denied Claims

If a plumbing issue causes damage and it’s discovered that an unlicensed plumber was used, insurance companies may deny coverage. Even if the claim is accepted, using unlicensed professionals can lead to higher insurance premiums due to increased risk.

Code Violations and Fines

Licensed plumbers are knowledgeable about local building codes and regulations. Using an unlicensed plumber increases the risk of violating these codes, leading to fines or penalties. If a property is found to be non-compliant during an inspection, it may require expensive corrective work to meet code requirements.

Voided Manufacturer Warranties

Many water heater manufacturers require installation by a licensed professional. If an unlicensed plumber is used, the manufacturer’s warranty may be voided, meaning the property owner will be responsible for full repair or replacement costs if the system fails.

Increased Liability for Injuries and Accidents

Unlicensed plumbers might not have the necessary insurance or bonding. If an injury or accident occurs during the work, the property owner could be held liable for medical expenses or lawsuits, increasing financial exposure.

Potential for Property Damage

Incorrect installations by unlicensed plumbers can lead to water damage, electrical issues, or even fires. This type of property damage can require expensive remediation, and in multi-family buildings, can impact more than one unit, compounding the costs.

Tenant Lawsuits and Relocation Costs

If plumbing issues result in uninhabitable conditions for tenants, the property owner may be legally obligated to pay for tenant relocation costs. Tenants could also pursue lawsuits for negligence if it’s found that the property owner used an unlicensed plumber, leading to unsafe conditions.

Lower Property Value

Substandard plumbing work can lead to ongoing issues, which negatively affect the property’s value. Buyers often require proof of licensed work, and if improper installations are discovered during inspections, it can reduce the sale price or require costly rework before the sale.

Increased Long-Term Operating Costs

Proper plumbing work ensures efficiency in water heating systems. Unlicensed plumbers may use outdated or incorrect methods, which can lead to increased utility costs due to system inefficiencies and higher-than-normal water and energy usage.

Difficulty Selling the Property

If unlicensed plumbing work is uncovered during a sale, potential buyers may walk away or demand steep price reductions. In some cases, lenders may even refuse to provide financing, further complicating the sale process.

 

In summary, while hiring an unlicensed plumber may seem like a cost-saving measure upfront, the potential for long-term financial damage far outweighs the initial savings. The risks include property damage, liability exposure, insurance complications, and even loss of property value.