With Improvement Projects Come Added Risk

American consumers spent nearly $300 billion in home improvements last year.
A recent study by the Joint Center for Housing Studies at Harvard University found that despite the recession, the remodeling market has held up better than new construction. The report predicts an estimated growth of over 10 percent in home improvement spending this year.
Too often, the impact of a renovation project on your insurance gets lost in the excitement of planning the new family room or kitchen. You should be aware of the added risks homeowners face before and after a home improvement project. It’s imperative to be sure your insurance coverages are set up correctly before a loss occurs.
Here are some tips for you to consider:
• Before renovations starts, require contractors to provide proof of insurance for workers compensation and liability coverages. Worker’s Compensation insurance pays for medical and rehabilitation expenses and covers lost wages if workers are hurt on the job.
Workers who were injured in your home can sue you or claim damages from you if the contractor they work for does not have adequate coverages.
• If you need to move out during construction, notify your agent to you can be certain that you have proper coverage for a temporary residence such as a hotel or rented home.
• With the added risks of a construction project — such as construction accidents, fires caused by power tools or open utility lines, and strangers in the house who may be tempted to steal your property or your identity — you may want to consider temporarily increasing homeowners policy limits or possibly changing your deductible.
• Home improvements can increase the market and replacement value of your home. Your agent can guide you to proper insurance coverage levels for the building coverage on your homeowner’s policy. Be sure you also ask about replacement cost coverage for your homeowner’s insurance policy.
• The renovated or extended space near home may fill up with new furniture, exercise equipment, electronics, and appliances. Track those purchases with receipts and a written or electronic home inventory. Additionally, check the coverage in your homeowner’s policy for personal property replacement cost coverage.
The team of professionals at the McMahon Agency can help you navigate the myriad of insurance options available to both home and business owners of south Jersey. Give them a call today at 609-399-0060, or visit them at www.mcmahonagency.com.