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Does Homeowners Insurance Cover My Liability While Remodeling?

Remodeling or renovating your Oak Ridge, NC home raises your home’s value and creates an exciting new living space for you. It does require a bit more liability coverage while undergoing construction. At Oak Ridge Insurance Services, we want you to understand why you need to temporarily increase your liability coverage during the remodeling process.

Home Insurance Liability Coverage

While undergoing remodeling, a homeowner should increase their liability coverage because of the increased number of people in their home and the dangers of the work involved. The person doing the work for you should carry their own business liability policy, but many independent handypeople do not.

Although every licensed and certified contractor must carry liability insurance in the US, individuals who refer to themselves by the generic term “handyman” don’t carry licenses or trade certifications nor must they purchase insurance. Why the difference?

Licensed Contractors Carry Their Own Liability

Licensed contractors attend a trade school for a specific job, such as a plumber, electrician, masonry, master carpentry, etc. They typically belong to a union, and those unions require certification. Each city creates its own building code which must meet its state’s building code and can exceed it. These codes require that a worker conducting renovation or construction work must carry a current license to do that job.

The state, city, and unions can create insurance requirements. To obtain a permit to do work on any building, these licensed individuals or homeowners must make an application and pay a fee. Without proof of licensing and insurance, they cannot obtain a permit. Only the homeowner can.

Most States Don’t Require Handypersons to Carry Insurance

Because handypersons don’t specialize, they cannot legally complete certain work. For example, a handyperson cannot legally install electrical wiring since they do not carry a license for that job. Hiring them for small jobs like fixing holes in drywall works great; avoid hiring them for large jobs that require specialization and license.

They might be an experienced do-it-yourselfers with no training and no professional experience, but they won’t get in trouble unless they use a professional title they did not earn, such as a plumber or master carpenter. These independent contractors rarely carry business liability insurance.

As long as you hire licensed union construction personnel, the general contractor will carry business liability. You should ask to see proof of their insurance before they start work. You should still increase your coverage temporarily, but you can probably get away with adding less than if you hired a handyperson who isn’t insured.

Home Insurance Revaluation Post-Remodeling

Also, when you finish your remodeling project, your home should undergo a re-valuation. This process ensures that you insure your home for its current value, not for the value that you originally purchased it. In case you need to file a claim, updating your home insurance covers your home’s full value.

Reach Out To Us

Protect your equity and your finances with home insurance for your Oak Ridge, NC home. Contact Oak Ridge Insurance Services today to make an appointment.

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