When the unexpected happens, just like a flooded basement or a hole in the roof, you might be inclined to repair the damage yourself instead of hire a team of professionals. Knowing what you're doing, going this route can certainly help you save some money, but they are you'll still required to notify your home insurance provider in some manner?
The short response is: it depends on whether or not you intend to make a claim.
Contact your insurance company before you start repairs
If you are planning on making a claim, you may still do your own repairs, but you'll need to notify your insurance provider before you begin the work to ensure that an adjuster can complete approximately the damages. The way you file a claim will depend on your particular policy, so make sure to speak to your insurance provider for details before you begin any work.
If you're doing the work yourself and never planning on making a claim, you may be hesitant about notifying your insurance provider for fear you could be penalized by means of higher premiums – something drivers grapple with with regards to car insurance claims. Generally speaking, simply asking an issue shouldn't lead to higher premiums there is however no guarantee that once your provider finds out about the damage, they won't raise your rates whenever your policy pops up for renewal.
Keep in your mind that not all repairs could be completed by a house owner. For example, electrical work should be performed by an authorized electrician and inspected by the relevant safety authority. You may even have to acquire certain permits depending on the repairs.
When to file for a home insurance claim
Sometimes, it's not worth making a claim. The damages simply aren't worth the hassle of through an adjuster emerge and assess the price of repairs, or coping with the possibility premium increase because of creating a claim. But there are several occasions when you might like to file claims against your policy.
For instance, when you are fairly sure that the price of repairs is important enough that the insurance payout would be worth the effort and need for creating a claim, you probably wish to file one. While you might not claim a $500 broken window that needs replacing following a tree branch impales it, you might want to file claims in the event that branch experiences your homes roof and requires $5,000 in repairs.
A big element of this equation is the amount of your deductible. In case your deductible is $1,000 and your repairs are less than or close to that quantity, it doesn't seem sensible to file a claim. When the damages are significantly more expensive than your deductible, however, it seems sensible to put in a claim.
Finally, if the harm to your home evolved as the result of negligence instead of an insured peril, you might like to skip the insurance coverage claim altogether, as your policy isn't prone to pay out.
Why make a claim if you are fixing the harm yourself?
The most compelling reason to make a claim on your homeowners insurance when you are carrying it out on your own is to ensure that you're reimbursed for that damage. The price of home repairs can escalate quickly, depending on the extent of damage, which is why we have homeowners insurance in the first place.
Most standard property insurance policies reimburse you for the actual cash value, which is according to what it really would cost to buy an item in similar condition. You might be able to purchase a guaranteed replacement cost endorsement to pay for the depreciation value of your house and contents. This could ensure you receive a similar product only one that is completely new. You will probably pay higher premiums for this kind of policy.
Also remember that simply because you might have, say, $50,000 price of flood protection, does not mean you will get $50,000 out of your insurance company when the damage only works out to $20,000. Your insurer is only going to cover actual damages, not the maximum coverage amount.
Check your mortgage agreement should you go the DIY route
It's vital that you know that if your house is mortgaged, your lender might not allow you to perform the repairs yourself at all, and may even possess a say in who performs any repairs. There may also be a clause inside your mortgage contract requiring your lender be named on insurance claim cheques. Make sure to check the information on your mortgage agreement if you're considering making an insurance claim.
In addition, you need to note that in case your DIY repair job isn't as much as snuff and restore your the place to find its pre-loss condition, you might be unable to file a future claim on your property insurance policy. Your insurance company may wish to see proof of repairs, and may ask about any past repairs designed to your property in case of a claim.
No matter if you choose to fix the harm yourself or hire a professional, whether or not you notify your insurance provider really is dependant on if you are considering filing claims. If the damage is important and you intend on filing a claim, or else you need to hire a professional for specific tasks, you'll want to notify your insurance provider as soon as possible. Should you choose choose to claim, the Insurance Bureau of Canada has a handy step-by-step explainer to make a home claim.