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Renovation Project

Is Your Home Renovation Covered By Your Insurance Policy?

Planning a renovation can be a fun and exciting time. Whether you’re re-modelling your existing space or preparing for an addition to your home, you’ll likely begin by browsing design magazines and blogs, visiting open houses and model homes, and pinning your favorite ideas to your Pinterest boards, ladies. But then there’s all that other serious stuff that needs to be done too, like planning your budget, finding the right contractors, and applying for the necessary permits.

But did you consider your insurance coverage for this project? It’s something that often gets overlooked, but it shouldn’t.

Did you notify your insurance broker?

If you don’t notify your broker of the changes you are making to your home, you may put yourself at risk. Depending on the kind of job you’re doing, your current home policy may not cover you. Most home insurance policies will allow small projects to be done to the home, but there are often a few considerations that need to be reviewed first. For example, what is the value of the project, are there any structural changes being done, what percentage of the home is under renovation, who is the general contractor, etc.

Another important thing to consider is your building limit coverage. Does your current policy have adequate coverage to rebuild the existing home, plus the renovation or addition? Your insurance broker may have to re-evaluate the rebuilding cost of your home in order to probably cover you.

Upgrade Considerations

Speaking with your insurance broker before things get underway may also offer opportunities for discussion on changes that could help make your home safer, and offer premium discounts . For example, installing a back-water valve, this will reduce the likelihood of a sewer back-up claim and also lower insurance premiums.  Or if you are living in an older home with unsatisfactory wiring, a good time to replace this wiring more easily is when other major work is underway.

Working with contractors

Renovations - Contractors

In addition to your home coverage, you should also talk about liability coverage. What happens if someone working on your property injures themselves during the renovation? You can help protect yourself against a potential lawsuit by verifying that your contractor is properly insured and has liability insurance, as well as workers’ compensation coverage. Ask to see proof of your contractor’s insurance, and make the same request of subcontractors, like electricians and plumbers, who may also be on the job.

Another item to consider is property damage by the contractors. When contractors are involved, either with a renovation or a new building, the buildings structural integrity and safety is compromised. This increases the probability for a fire loss or building collapse as an example. If a loss of this nature occurs its the contractors liability policy that could be responsible to pay for the damages.

DIY Renovation

If you opt to take on a do-it-yourself project and have friends or family lend a hand, you should check that your own liability coverage will have you covered. Also, be sure to do thorough research to ensure any materials you select have been certified by an independent third-party agency, like the CSA or ULC. These logos should be clearly visible and easy to identify.

Get the proper permits and paperwork

As with any big project, whether it’s a do-it-yourself job, or you’re working with a contractor, be sure to speak with your local municipality about building permits. Renovations that include plumbing, electrical, structural changes, or additions almost always require a building permit prior to starting the work. The permit application procedure will help ensure that the renovations you’re planning comply with applicable building codes. If a permit is not secured where one was required, it is possible you could be ordered to stop or even redo the work – which can significantly increase your timeline and budget. You could even face a monetary fine.

Be sure to keep copies of any contracts and receipts for materials purchased for the job. And take photos before, during, and after the renovation so you have a visual record of all the work.

Do you have plans to renovate this year?