Keeping Your Home Safe During Construction
When building or renovating a home, homeowners are faced with unique risks. During the construction process, homes and homeowners are more susceptible to losses ranging from fire and theft, to vandalism and injury to a third party. However, with proactive planning, you can minimize your risk and enhance the likelihood of a safe and successful project so you can enjoy the comforts of your new or renovated home.
Call Swingle Collins & Associates to discuss your plans and get advice on several important issues:
- Builder’s Risk Policy: New home construction or renovation to your existing home requires a builder’s risk policy to cover your property during the course of construction. When researching a builder’s risk policy, it is vital that there be a clear understanding of the policy terms and conditions. There is no “standard” builder’s risk policy form. Different builder’s risk policies insure against different things and have coverage limitations and exclusions that may limit insurance coverage.
Another important item to be aware of is the policy’s effective and termination dates. Again, different policies have different definitions of when coverage ceases or is terminated. Beware that the expiration date of the policy may not mean that the coverage is still in place. Other triggers of the termination can be “substantial or partial completion”, occupancy status, contract termination, or issuance of a certificate of occupancy or a “green card”.
Certain risk factors significantly increase when homes are left unoccupied during construction.
A builder’s risk policy can be sourced and provided by Swingle Collins, your builder/general contractor, or offered through your bank/mortgage provider. Purchasing a policy for yourself will give you both coverage control and policy value, especially when the process is managed by Swingle Collins to ensure that you have the right coverage for the right project.
Each Builder’s Risk policy is as unique as the project which it is designed to protect. Understanding the terms and conditions of the policy you purchase, and making sure you retain control of the coverage and loss payments are imperative in making sure you are fully protected.
- Liability: If the workers coming to your home don’t have adequate insurance, you may be held responsible for injuries and accidents that occur on the job. Swingle Collins & Associates can tell you how to verify their insurance. You may also want to increase the liability limits on your policy.
- Opportunities to save: With your home under construction, it may be the time to upgrade your alarm, plumbing, or electrical systems, or install loss prevention devices such as a whole house leak detection and water shut off system. Upgrading can earn premium discounts on your policy.
- Home value: Improvements to your home will increase its value. The change needs to be reflected in your policy to ensure proper coverage.
- Create worker and occupant ground rules. If you will live in or visit your home during construction, set rules with workers on start and end times of workdays, and when rooms are off limits. Plan to handle disruptions of regular activities, from parking to meals.
- Allow your contractor to handle negotiations with the workers and sub-contractors. In order to reduce your potential exposure to liability risks, you should not direct or supervise any of the actual labor performed; this is the general contractor’s responsibility.
- Make sure everyone who enters or approaches the home is aware that noise, dust, debris and scraps, welding tools, and sharp objects are risks. Let every person near or in the house know they must heed safety practices.
- Post emergency numbers for the fire department, police department, and ambulance prominently and close to telephones.
- Keep portable fire extinguishers easily accessible, preferably on every level of the home and every 1,000 square feet. Forbid smoking on the site.
- Require workers to clean up debris daily, since construction materials are combustible. Rags and solvents are especially dangerous; they can spontaneously ignite. Insist upon having them removed and stored properly off site on a daily basis.
- Turn off water and gas supply lines if not needed, but never disconnect fire or security alarms. Dust from sanding and plastering can trip detection systems. Cover these units but make sure the covers are removed at night, when fires often occur.
- Consider motion-activated lighting, fencing, gates across driveways, and security guards to help protect an unoccupied house. Use a locked garage or room to store tools and materials.
- Store jewelry, valuables, and documents in a safe or fire-resistant box or off premises. Back up computer files of important records and information.
- Let Swingle Collins know the project is nearing completion and discuss once again the adjustments necessary on the replacement value of your home, which is reflected on your Home policy as the dwelling limit. Properly notifying us of the improvement is required to keep our promise of full replacement cost on your home intact.
- After you have gained your certificate of occupancy, and have partially or completely moved in, you may have some finishing work performed on your home as renovation or construction is completed. Ensure that your builder and sub-contractors all carry adequate liability coverage in the event of an accident while on your property, and ensure that your home policy has been bound and issued.
- You may also want to increase your liability coverage if improvements included, for instance, a swimming pool, tree house, or other structure that could be considered an ‘attractive nuisance’ and focal point for guests, children or trespassers.
Swingle, Collins & Associates specializes in homeowners insurance and renters insurance coverage. The descriptions of coverages listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your coverage needs for condominiums, flood, or earthquake insurance please contact your dedicated risk manager to discuss the benefits and services of personal homeowners insurance coverage.
The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverages, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.