The weather is getting nicer outside, making it a great time to start those renovations you’ve been wanting to do on your house.
Before you hire a contractor for those renovations, is your home covered with the right insurance for the project?
It might be easy to assume your contractor's policy will cover things in the event of a loss or that your homeowners insurance has you covered; well, don’t assume so fast!
Coverage during renovation projects can be tricky.
When Home Improvement Projects Go Awry
Though started with good intentions, home renovation projects can sometimes go wrong and damage can occur.
Fires caused by contractor tools and electrical problems are especially common, many of them quickly erupting into infernos due to the extra construction materials waiting to be used for the project being done in the home.
Since these circumstances present an insurance challenge, it’s essential that homeowners ensure any losses are covered before they happen, then take steps to prevent them in the first place.
Does Your Contractor Have the Right Insurance?
A critical consideration when having renovations done is insurance as damage sustained in a renovation accident may not be covered by standard homeowners policies.
Owners should request proof that their contractor has a builders risk insurance policy to protect the dwelling and all its contents while construction is ongoing in the event of a construction-related accident.
Contractors should also be carrying their own general liability insurance and workers compensation insurance as well.
These three policies provide nearly complete protection for both the contractor and homeowner in the event there is an accident during a reno project that results in damages and an insurance claim.
Owners should request to see the certificate of insurance and then confirm that there is a valid policy in effect before agreeing to start any work in the home.
Prevent Insurance Claims During Home Renovation Projects
Most home insurance companies require homeowners to either obtain supplemental homeowners coverage for perils related to these projects or provide proof that their contractors are adequately covered.
Of course, the best insurance is to prevent an accident in the first place or at least having steps planned to minimize damage should an accident occur.
Every renovation plan should include risk assessment, safety policies, and loss prevention policies instituted at the beginning, with both the contractor and homeowner working together to reduce accidents and damage.
Insurance coverage is then available to protect when accidents are unavoidable even with other preventive measures in place.
Proper Protection Against Home Renovation Threats
The takeaway for homeowners looking to start home renovation projects is that they should not go into them lightly by neglecting to look into insurance coverage during the project.
It’s essential to confirm that contractors are carrying builders risk insurance and general liability insurance, then work together on a plan to prevent accidents that could cause extensive damage and expensive insurance claims.
Even seemingly small home renos have the potential to turn into nightmare projects, so be ready for a worst-case scenario rather than being left wondering what to do afterward!
