This time of year many people start thinking about remodeling their homes and doing some updating. The weather is nicer and its a lot easier. It could also be due to damage caused from inclement weather. Whatever the reasoning may be, it is a popular time of year for this.
The majority of people will hire a general contractor to handle their renovations while some choose to do so themselves. Some homeowners will do portions of the work and hire licensed electricians and plumbers for that work.
No matter how you go about this, remember: The homeowner, the general contractor and all subcontractors need to have proper insurance coverage.
The first thing you want to do is review your homeowners insurance policy. You want to be sure that your policy covers your home and property during the time it is being remodeled. You may have to move furniture out of the house. A lot of times people will rent a container and store this on their property. Make sure that when doing so the contents are covered. You may need to get an additional policy for that period of time depending on your coverage.
You want to contact your broker if you are doing the work yourself to insure you are not voiding your policy. Some homeowners insurance policies do not cover work done unless it is by a licensed and bonded professional. Due to the amount of variables that exist when it comes to insurance, especially for remodeling projects, you want to be sure that you have crossed every “t” and dotted every “i”.
That being said. If you decide to hire a contractor, make sure they are licensed and bonded with a surety bond before you sign a contract. This protects you in the event they cannot finish the job. Under your contract there should be an agreement that all of the work will be done according to current building codes and all of the proper permits will be obtained.
The general contractor is responsible for property damage, on the job injuries and negligence in workmanship. All of this should be covered by their general liability and worker’s compensation insurance. Confirm their coverage with their insurance company and ask them for documentation and proof of all certifications with dates to insure that this will be in effect during the time period the work is being done.
Purchase a builder’s risk policy. Building materials and equipment belonging to the contractor or subcontractor are not protected in the event of theft by your homeowners insurance policy. Consult your broker about whether or not this is something you want to invest in during the construction period to protect yourself and the contractors. The general liability policy your general contractor should have will most likely cover damage to your existing property, but not to any new work they do, or additions made. They are only liable for damage to the old home, not the new additions. By having a builders risk policy you will be protecting your home addition as well as the tools and equipment of the contractor.