Does Home Insurance Cover Renovations or Damage Caused by Contractors?

Aug 23, 2019

23 Aug
Homeowners Insurance

Does Home Insurance Cover Renovations or Damage Caused by Contractors?

by Richard Leon

If you are planning a home renovation project, get coverage from the right home insurance plan to ensure that you don’t get stuck with any unnecessary expenses. 

Why Do I Need Home Insurance for Renovations?

If something happens to your home during the renovations, or you need to rebuild it, you’ll want to make sure that your policy provides sufficient coverage. In addition to initial risks, your current homeowner’s insurance policy might not have a high enough limit to cover the value of your home after the renovation is complete. 

  • What Policy Changes Should I Make?

Plan ahead by talking to your TSC Direct agent about what policies should be updated. With small projects, it often makes sense to increase coverage limits incrementally while the project progresses. Large projects might require an addition to your policy. 

  • Do I Need a Policy Change for a DIY Job?

If you plan on tackling a do-it-yourself type of project with friends or family lending a hand, you should extend your liability coverage. Although it’s difficult to foresee, you may run the risk of a lawsuit if a friend or family member gets injured on the job.

  • Should I Increase My Coverage Limits?

Typical homeowner’s insurance policies cover your existing home during a remodel but won’t automatically extend to additions. Revisit your policy to include additions that increase your property value.

What Happens If My Contractors Damage My Home?

Although homeowner’s insurance helps pay for repairs when a contractor damages your home during renovations, it may not cover everything. Adding policies for faulty or inadequate workmanship can help you stay covered in unforeseen events.

  • Accident Coverage

If a contractor accidentally damages your home, starts a fire, or causes flooding, their insurance company will likely reimburse the repair costs needed. Make sure your contractor has sufficient insurance before you begin the project, or your homeowner’s insurance policy may be needed for repair costs. 

  • Resulting Damages

While homeowner’s insurance doesn’t cover poor workmanship, it may cover damage resulting from the work. Examples include faulty plumbing that causes flood damage or improper shingling that causes structural harm. 

Stay Organized to Help Your Insurance Claim 

Make sure to keep copies of any contracts, receipts, and material lists for your home renovation project. Taking pictures of your home before, during, and after the renovation provides a visual record of the work completed and keeps you protected against contractor mistakes. 

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