Your Insurance Punch List
It’s a home improvement project. What could go wrong?
Better not to think about it. That’s really a job for the agent who handles your homeowners’ insurance. Before you get going on your project, review your policy to make sure coverage includes these hope-they-don’t-happen factors:
Fire. Stripping woodwork is notorious for sparking fires; using chemicals and dry materials can only raise the level of risk. Make sure you are covered, not only for your current dwelling, but also for the cost of materials that could be destroyed.
Damage to neighbors’ property. Especially in urban areas, it can be difficult to control what happens—and how—on a job site. A neighbor’s fence could easily be crushed, for example, by a load of lumber that slides off a truck. Especially if your project involves significant exterior demolition, consider a short-term rider that covers your neighbors.
Accidents. Slips, falls, and injuries that occur on your property can quickly become grounds for lawsuits. Make sure you know, one, the extent of your homeowners’ policy and, two, what you must do to ensure that contractors comply with safety requirements. If they don’t take reasonable precautions, and you failed to hold them accountable, you might be liable.
The finished value of the project. You may need an appraisal to solidify market value post-renovation, but that fee can help protect the value of your entire house. Be sure to document the quality of the work with photos and receipts, with a duplicate file kept offsite in a safe location.
And don’t forget to cover the value of furnishings for your new rooms!