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Insurance and Home Remodels: 5 Things to Consider

Oct 06 2016

If you own a home, it is likely that you will make changes or improvements at some point during the course of your home ownership. Whether you are making small improvements or more major changes, it is important to understand how your homeowner's insurance coverage is impacted by a remodel. Below we discuss five important points to consider before construction begins:

Speak with Your Agent Before Construction Starts

Your current home insurance policy covers your house and its features specifically. Thus, any significant renovation projects may change the amount of homeowner's insurance coverage you need.

When you have a general idea of what you want out of your remodel, speak to your local independent agent. They can advise if the proposed changes are covered by your current policy or if an increase or decrease in coverage may be necessary.

Ensure Proper Inspections Are Completed

If your remodel is more extensive - adding walls, rerouting electric work, adding foundation - it is important that the work is inspected during the course of the remodel. These inspections will verify that the construction is safe and up to code. If inspections are skipped, your insurance may not cover damage on these remodeled structures.

Confirm That Workers Have Appropriate Coverage

In most home remodels, there are three groups of people that may be handling the work:

  • Contractors
  • Subcontractors - Electricians, Plumbers, Painters, etc.
  • Workers

Anyone that is working on your home should be properly insured before they step foot on your property. Should someone lack coverage and get hurt while on the job, you could end up responsible for their medical bills.

If you go through a reputable remodeling company, your contractor and their workers should already be covered by their own insurance policy. Request to see a copy of your contractor's workers compensation policy before construction begins. Subcontractors, like electricians or plumbers, may or may not be covered by your contractor's worker's compensation policy. Make sure to check in with each individual subcontractor to ensure they have their own proper coverage.

Don't Forget About Friends and Family

If you are tackling a do-it-yourself remodel, make sure any friends or family that are lending a hand are insured. The liability coverage of your homeowner's insurance and the friend or family member's health insurance should cover any injuries. But it is always smart to check your policy and reach out to your insurance agent with any questions.

Increase Your Coverage Beforehand

Improvements to your home increase the value of your home. While some policies may provide comprehensive coverage for improvements or additions, others may not. It is important that you contact your insurance agent before work begins and increase your coverage if necessary. Make sure that any new features, furniture, electronics, or other household items in the remodeled area are added to your policy as well.

Many do not think to update their policy until the remodel is complete, however, if a new room or addition is damaged during the remodel process, this addition may not be covered. Updating your policy to cover new rooms and features before construction starts can help to ensure that you are covered during the entire remodeling process, and beyond.

While many homeowners enjoy dreaming up remodeling projects, these projects can quickly get out of hand if you do not have proper insurance coverage before, during, and after. At Grange Insurance Association, we have over 120 years experience helping families protect what's important to them. Contact your local independent agent today to ensure that you have the appropriate amount of homeowner’s insurance during remodeling.

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