Cover for your Project and Cover for your Loan...
Adequate Homeowner Insurance cover is something we all need to protect our assets - we can't afford not to have it.
Have you heard any insurance stories lately?... usually they fall into two categories:- the man with insurance cover who had absolutely nothing go wrong... and the horror stories from the man without cover who suffered disaster upon disaster during his home improvement project.
If there's a moral to these stories it seems to be that you are less likely to need insurance - as long as you've got it!...
The hard fact is that when you invest and then re-invest in your home, the biggest investments you are likely to make, YOU NEED TO PROTECT YOUR INVESTMENT WITH HOMEOWNERS INSURANCE AND a LOAN PROTECTION PLAN.
The following Article gives information and tips regarding Homeowner Insurance for home improvement project materials AND payment protection advice for your home improvement financing loan.
If you are planning HOME IMPROVEMENT and FINANCING, then you need insurance cover for both:
Cover for the money AND Cover for the build
Cover for the Money
Protect the repayments of your home improvement loan with a good payment protection plan. This type of Insurance protects a borrowers ability to maintain repayments if the borrower has difficulties due to accident, sickness or unemployment.
Of course right now you are feeling great,
you are planning your home improvement, the finances, the plans, looking forward to construction AND insurance is the last thing on your mind, but you can't afford to ignore it.
Often the worst things happen when we least expect them to, get covered and get protected, take out a protection plan when you take out your loan.
Make sure that your agent is a recognized insurance provider. If you are in the U.K. they would be a member of the General Insurance Standards Council ("a watchdog established to set, moniter and inforce standards in all areas of general insurance, including the fair treatment of customers")
Cover for the Home Improvement Build
INSURE YOUR HOME IMPROVEMENT PROJECT AND PROTECT YOUR INVESTMENT
- Don't wait until the work is completed before you increase your homeowner insurance cover. Include the addition in your homeowner insurance BEFORE work begins.
If you work without cover and something goes wrong, you won't be able to re-coup the loss.
You will have purchased a Homeowner Insurance policy when you took out your mortgage. Most homeowner policies cover: Structure, Landscaping, Personal property, Temporary home expenses and Personal liability.
Important Side Note:
- Your homeowner insurance does not directly reflect the price you paid for your home because you are only insuring the home itself, not the land that it sits on.
- Likewise when you increase the cover to include any new structures, you are insuring the cost of construction, not the cost of any demolishing/clearing work done before you started...
As you are now planning your home improvement and remodeling project
and going through all the paperwork, there is a very important consideration regarding everyone and anyone working on your home. This concerns the PERSONAL LIABILITY section of your homeowner insurance:-
First, make sure that the contractor and subcontractors due to work at your home ALL have adequate insurance coverage.
Home Improvement contractors are required to tell you if they carry Commercial General Liability Insurance and to provide you with the contact details of the insurance company.
Ask your contractor to tell his insurance agent to send you a copy of the insurance certificate, confirm with the insurance company that the contractor's insurance coverage is sufficient to cover your project.
The contractor's certificate of insurance should include general liability, Workers compensation, (this is a USA policy that pays medical and rehabilitation expenses and also covers lost wages if the workers are injured on the job.) and auto coverage.
Ask to see a CURRENT copy of the policy, workers who are injured may sue you if the contractor does not have adequate insurance.
So, depending on the answers to the above questions you will have to go back to the the PERSONAL LIABILITY section of your homeowner insurance.
If necessary ask your agent for details about extending the limits of the liability of your policy. Liability Protection Provides no fault medicaL coverage.
Confirm with your agent that this would be enough to fill in any gaps left by your contractor and/or subcontractors insurances, if not then you may need to look at umbrella liability coverage as additional insurance cover.
- Getting the Best Deal...
If you have worked with the same insurance company for several years and have your home, life and car insurance with them, then you could receive 5 - 15% off your premium,
In this case you are more likely to get a better deal as a long standing policy holder, than if you shopped around. (Although it always a good idea to get up to 5 other homeowner insurance quotes to compare)
If your home is new with new plumbing, wiring and electrics your insurer may take off between 8 - 15%, the same may apply to your "new" home improvement addition.
Insurance companies will not provide cover for your home, If you do not maintain it well. If you allow mold, termite infestation or infestation from any other pests to set in, then the insurance company will hold you responsible for rehabilitaion costs due to lack of care.
There is a definite link between home insurance, home maintenance and the value of your home.
If your home is well maintained you will pay less permiums on your homeowner insurance, have less yearly maintenance costs and receive a higher sales value if you should decide to sell.
This is why good home improvement projects and well maintained properties really pay off as you improve the value of your home.
More Homeowner Articles...
Once you have your home improvement finances and adequate Homeowner Insurance
cover in place giving you peace of mind, its time to enjoy your home improvement project...
Make your own Homeowner Insurance Web site...
Last Modified: March, 2006
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