Before, during and after renovating your home, you should verify the coverage of different aspects that could affect your home insurance policy or even get rid of lawsuits.
Did you know that when the new year arrives, many people want to make a renovation of their home? As you read it, you are not the only one. However, such projects are often expensive. And if you have homeowners insurance, the large amount of money spent on that remodel may be at risk by being left out of coverage. This is where home renovation insurance comes in.
Actually, more than home renovation insurance, it is a verification that your home insurance fully covers your house, in case it has damage that is within the coverage of the policy. Homeowners insurance calculates the cost of premiums and deductibles based on the market value of the home at the precise time of purchase and the cost of rebuilding the home if it were damaged.
When you do a remodel, improvements may not be covered due to the higher replacement cost of the home, which would also increase your home’s coverage limit and the cost of your monthly premiums and deductibles.
Before making expensive changes to your home, it is recommended that you contact your agent or insurance company to explain your housing project and they can explain the changes that could cause in your policy. Most likely, it is possible to adjust your insurance coverage, with a possible increase in your monthly payments.
But every renovation project is different. For example, adding a fence or shed falls under coverage for other structures; purchasing more furniture for an addition or adding high-end electronics counts toward the personal property limit. In short, all these types of additions should increase the value of your policy and, consequently, the cost of the premium and deductible.
If you add a swimming pool to your home, it is advisable to increase your personal liability coverage limit, since the chances of being injured or drowning in the pool are increased, which in turn creates a high potential for third-party lawsuits that could be affected. .
Also, during renovation it is important to protect the project. Ordinance or law coverage protects you from having to pay out of pocket to bring your home into compliance with local building codes.
It is also recommended that when reviewing construction options, you hire a certified and licensed contractor that carries builder’s risk coverage. This insurance covers expensive building materials from theft or damage while on your property.
You should also confirm that your contractor has workers’ compensation insurance to pay for medical expenses if someone is injured while renovating your home. If you do not have this insurance, a worker could file a lawsuit against you. Make sure the contractor’s insurance also applies to subcontractors, or if it doesn’t, they have their own coverage.
Since there is no way to guarantee the work or renovation insurance to back you up, take photos of the project before, after and during the process. This documentation would help you file a claim or redo the job if you need it.