Hiring a contractor to work on a home is something countless people do every year. Maybe you`ve always wanted to finish your basement, renovate your kitchen, or install the luxurious bathroom you dreamed of. Either way, when you hire a contractor to work on your home, you have high expectations; The last thing you expect is for the contractor to cause damage to any part of your property. While you certainly deserve to be compensated for the damage to your home, the truth is that insurance companies are often reluctant to pay anything to claimants and often offer far less than they earn or even reject claims outright. If two insurance companies are involved (your landlord`s insurance policy and the contractor`s insurance), the claims coverage process may be delayed because these two companies may have back and forth on who owes what. However, homeowners` insurance does not cover bad finishes. Essentially, if your contractor cuts into a pipe and floods your basement, the water damage is covered. If one of your contractor`s employees steals jewelry from the bedroom, this would also be covered. However, if you need to have the work reworked, your insurance will not cover you. this is expressly the responsibility of the contractor. In addition, your home insurer can pay for the claim and then follow your contractor`s insurance company for collection, which is called recourse. Not only is it unlikely that your landlord`s insurance will cover the damage, but it`s also undesirable to make a claim on your landlord`s insurance policy, as claims can lead to an increase in insurance premiums.
Making a claim for property damage could also cause problems in renewing your home`s insurance, as the insurer may not be willing to renew the policy until repairs are made. A licensed contractor must be insured and may also be immobilized. This means that they must take out liability insurance. This means that you have to be careful if you hire the contractor. Avoid hiring a friend as a handyman unless it`s a very simple job like assembling furniture, replacing a door handle, etc. For many homeowners who have problems with inappropriate construction work, their first thought is to make a claim with their landlord`s insurance company. Not only does your landlord`s insurance usually not cover damages, but it`s often a bad idea to make a claim for other reasons. The cost of repairing damage to your home or completely rebuilding in the same quality – at current prices – is the replacement cost. It is related to the amount of coverage you choose and the amount your insurer pays you when you make a claim. Therefore, you need to adjust the coverage of your apartment so that it best matches the replacement cost of your home.
Otherwise, you are underinsured. Professional contractors rarely cause damage, but accidents do occur. The cost of renovating a home often plays an important role in why these projects can be stressful. If your end result is hammered by a makeover incident, it doesn`t help. The Insurance.com survey also looked at how different types of renovation errors cost homeowners. Most of those who didn`t complete a project were on the road for less than $2,000, while most of those who spent more than expected exceeded the budget by more than $8,000. Before you start the next big home renovation, pick up the phone and contact your friendly home insurance agent to make sure you`re protected no matter what. Renovation coverage also covers all the building materials you buy. This only covers them when they are on your physical property, but also if something were to happen to these materials while they are on their way to your home.
This is reason enough to take out home renovation insurance before your next project. While home insurance is designed to protect your home from damage, not all damage during the renovation is covered by home insurance. If your contractor caused the damage, your neighbor will usually be compensated by the contractor`s insurance claim. However, if you do the repairs yourself, you will face greater personal liability, which makes home insurance coverage all the more important. Home insurance usually covers damage related to renovations. Be sure to check your policy document for what could be excluded. That`s why it`s good for you to hire a contractor who has liability insurance and offers a guarantee of their work. Your contractor`s liability insurance is an important safeguard to protect you and the contractor if something serious happens during or after construction. So your first step will be to bring a liability action against your contractor. This means you don`t have to pay a deductible and you don`t have a negative rating in your claim file. Keep in mind that even if the claim you file against your home insurance isn`t paid, it`s still listed as a claim, which can lead to an increase in your premiums while you start renewing the policy.
If you have damage that appears to be the result of poor construction – for example, water damage to walls, ceilings or floors with no obvious water source or cracks around doors and windows – the best course of action is to consult a lawyer who specializes in construction defects. A construction defect lawyer can assess whether the damage is the result of a sudden accident, which is best remedied with a claim with your landlord`s insurance company, or the result of a faulty construction that could be better corrected by a lawsuit against the contractor. If the damage is due to a faulty construction, you can recover the money needed to repair the house with a lawsuit against the builder. The builder should have their own insurance policy, and that insurance is who should pay for the damage to your home. If, like many homeowners, you mistakenly believe that your home insurance covers your property for flood-related damage, you`re not alone. Most people are surprised to learn that flooding is excluded from coverage with almost all standard home insurance policies. Those seeking coverage must apply through the federal government`s National Flood Insurance Program, which is administered by FEMA. If you are concerned about poor construction completion, you can ask your insurance agent for insurance against the builder`s risks. This will make the payment if your personal belongings and furniture are damaged due to the exposure during construction.
You can also check if your contractor has this coverage in their builder`s insurance. Home renovation insurance goes above and beyond that to protect your repairs and renovations when and where your usual home insurance is insufficient. Also known as an apartment under renovation insurance, this can be the lifeline you need if everything doesn`t go as planned. The insurance company that pays for damage to your home often depends on your landlord`s insurance policy, the type of damage, and how the damage was caused. For example, damage caused by an actual accident (such as a fire) caused by a contractor may be covered, while poor craftsmanship may not be. Your existing coverage may not automatically extend to a newly created supplement, so you may need to make changes to your policy if you choose an add-on. “Apartment under construction” or “renovation” insurance can also be added to your home insurance policy to cover you in the event of a foundation collapse, damage to building materials or theft of building materials. Home insurance or property insurance usually does not cover construction defects. Insurance policies usually have wording that says damage due to faulty workmanship and construction is not covered by the policy. .
