Home Renovation from an Insurance Agent’s Viewpoint

When we begin planning our home renovations, we are careful to take into account interior design, budget, schedule, contractor references, etc., but are we as careful when we think about how our insurance will be impacted? Probably not. It’s not as interesting, and frankly, it isn’t the first thing you think about when you consider renovations.

According to insurance specialist Scott Spencer, writer for Insurance Journal, homeowners should take just as much time considering their insurance coverage as they do their interior design or budget. This is especially true when the renovation involves hiring outside help, changing the structure of the home, or adding on square footage. These activities all involve some measure of risk which savvy homeowners will protect themselves against.

Protect against fire
For one, did you know that a third of all house fires happen when contractors do work on a home? It isn’t something you can protect against, but it is something you can prepare for, which is why additional insurance might be purchased to cover damage done by contractors or in the course of construction.

Bodily injury
Spencer mentioned other hazards, including, “Bodily injury liabilities from nosy neighbors venturing onto the property and then tripping over equipment or building materials.” You might also think about “invited friends and guests, including people making deliveries to the house.”

Damage to valuables
Do you have valuable furniture, decor, or collections that might be damaged during remodeling procedures? If a piece of your exterior is going to be removed or you have to leave contractors working without supervision, are the valuables of a type that might be stolen? Protect yourself against this type of hazard by doing thorough reference and background checks before hiring contractors or subcontractors and storing or locking up valuable items or documents with personal or confidential information.

Unseen health hazards
There are also possible health hazards that go unseen in a construction environment, such as exposure to asbestos, lead, or mold. Have an inspector look at your house before paint or sheetrock removal, especially if your home was built before 1970. Any construction work that stirs dust into the air might expose your family and construction workers to airborne contaminants.

Risk advisor
Having an insurance agent inspect your home and look over planned renovation projects can provide you with important risk assessment information. Spencer said, “[The] risk advisor . . . can review the coverage breadth and financial limits of contractor insurance policies. They can further ensure the family’s insurance policies are amended to address the additional property exposures and the added liabilities.” Even in minimal renovations, knowing the risks ahead of time can help protect you physically and financially.

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Source: insurancejournal.com/magazines/closingquote/2014/09/22/340636.htm