Remodels, Purchases Mean Insurance Check Up

Remodeling a home can be exciting time for owners, but it is also a good time to make sure your insurance is up to speed so that you do not encounter any financial hardships during the process.

Not only is it important for the home’s owner to be properly insured, but also the contractor and subcontractor who do the work on the residence.

The biggest gaffe homeowners make is waiting until an addition or extra room is finished to increase the insurance coverage on the residence. In the event the new home is totaled or damaged prior to the insurance coverage being increased, the owner might be held responsible for the expense of repairing or rebuilding the addition.

It is advisable for homeowners to reach out to their insurance agent or rep prior to or shortly after construction starts in order to add to the insurance coverage on the home to an amount that reflects the greater value of the rebuilt residence.

When bringing on a general contractor, be sure to discover if the contractor has workers’ compensation coverage and ask to view a copy of the policy. Workers’ Comp pays for medical and rehabilitation costs and covers lost wages should the workers sustain injuries while working. Injured workers might turn around and sue you if the contractor does not have the required insurance.

In the majority of home improvements projects, the contractor subcontracts the builders, plumbers and electricians. Given that the hired workers might not be full-time employees for the contractor, they may not be covered through the contractor’s workers’ comp plan. Even though some independent workers may have their own workers’ comp protection, others may not.

Homeowners having work done on their premises should be sure to verify the insurance policy for the contractor and the subcontractors.

In the event the coverage is not sufficient enough, homeowners may have to fill in the holes via extending the limits of the liability portion of their homeowners’ policy.

For those homeowners who buy added items like furniture, electronics, etc. they many need to add to their amount of insurance they already have on their personal possessions. The best thing here is to maintain receipts and add them to a home inventory.

Adding on to a home can be an exciting time; just make sure you have the right insurance coverage in place so that excitement doesn’t turn to despair.