ACutAbove, I agree that not all contractors are alike and that some very reputable contractors may be undercapitalized, as I mentioned in a previous post. That, in itself, is no disgrace. Owning a new business is challenging and growth requires capital, and that can be difficult to keep up with.
I also mentioned that a deposit is a reasonable request because it shows good faith and also allows the contractor to cover some of his work at the beginning. The deposit amount can usually be agreed upon at the time of contract.
However, I think 50% down takes away some of the incentive for timely completion of the job, and that progress payments might be a better way, if the job is large and is going to take a while to do. That is the way most construction loans are handled.
Asking for insurance documents should not be an insult to a legitimate contractor and it is necessary to allow piece of mind for the customer. It also assures that the workers are covered if anyone is injured on the job and is required by state law.
I appreciate your position, since I was a business owner for many years and I can recall the growing pains when I started out. It sounds like you are on your way to a successful career.
