It is the law, and building permits can protect you. With a building permit, you get the advice of reviewers and inspectors who are tasked with reviewing for approval each phase of your project, checking to see that the work is done in accordance with the Building Code, zoning, and the approved plans. A building permit is required to show compliance with sanitary and life safety, assist in obtaining insurance coverage, and welfare concerns, including protection from unlicensed contracting.
Working without a permit results in potential fines and cause problems when you sell your home. More importantly, you lose the assurance that the work you're paying for is built to code, a minimum standard for safety.