Whether you're ripping up carpet to place down a brand new floor, adding punch to some room with new paint, or adding another living area, getting work done on your house is a big step for most homeowners. Unfortunately, it does not always go well.
Take my own spot for example. This past summer my landlord bought an old semi-detached house in Toronto just for under $1 million. It had been a nice place, however it hadn't been upgraded in decades and needed work done on almost everything. Luckily, since he'd saved cash on the first purchase, he had enough to start turning the home into the home he needed. He'd in regards to a month before i was all supposed to relocate. That did not quite exercise.
Regardless of whether you train with contractors or try everything yourself, renovations can get complicated very quickly. If you are lucky, a task could take more time than you planned for, but if things go sideways, you'll not only generate losses, but damage your home as well.
It begins with insurance
Under most circumstances, homeowner's insurance covers your home from damage or theft, but that is certainly not the situation if a part of your house is going to be under construction. If you're likely to be making significant changes towards the home, it's almost always recommended to tell your insurance company you're doing the project before you begin it.
“It never, ever hurts,” says Chris Fowler, senior manager of personal lines at Aviva Canada.
“It's highly recommended that the first thing they do is contact their broker or agent to advise them of the items it is they're thinking about doing because there may be options under their policy or additional coverage they need to purchase to create themselves fully protected.”
Fowler also points out that there are no standard for home renovation coverage, so although some policies won't require additional protection, the simplest way to understand you're covered is to ask a broker. Simpler projects, like tiling a kitchen, won't require any changes to your policy, while major projects will. One example Fowler brings up is the fact that you'll lose your theft protection when the you cannot be home during the reno period.
Can property insurance cover you if your home is damaged with a contractor?
So your insurance provider knows what's going on and you've got ensured your policy is set up to pay for you as best it may. Time to put those contractors to work, right? Well less than. A part of why it's good to talk to a broker about this stuff is they will clear up any misconceptions you might have about their products. For instance, home insurance won't help you in case your renovations result in damage to your house, even when that damage may be the fault of contractors.
I spoke with Chanel Man, a hair and makeup professional in Calgary, about how an easy project to include a concrete path in her own backyard converted into a nightmare that took three years to accomplish and cost nearly twice what she'd planned.
Chanel and her husband bought their house in 2021, an 1,800 sq . ft . semi having a detached garage. It had been a nice place, but being a newly-built unit inside a new development, there have been some facets of it that needed a lift. Mainly, the couple needed a concrete path in the house towards the garage, plus a handful of making getting in and from the backyard easier. Sounds simple, right? The only real catch was they live on an incline and also the concrete had to be created to make certain water wouldn't damage the foundation of the home or even the garage.
“When the job ended, we knew something wasn't right,” Chanel explained. “The concrete was bulky and also the steps were huge. Even neighbors all around us said hello looked terrible.”
“My husband and that i took buckets water and poured it over to observe how water flowed, and it led straight to both the house and garage,” she explains. “We messaged the man and he said he would come by and connect this issue. He made several lines within the concrete and asserted should work. We tried it out again and water still flowed towards the house and garage.”
The contractor would be a friend of a friend, so when choosing to hire them, Chanel didn't do too much vetting. That turned out to be her mistake, because at this time, instead of cutting losses and hiring somebody that could get the job done right, she chose to provide them with one more chance. They informed her they'd designed a mistake and would fix it, but would have to charge extra to demolish and redo the task. This is when things really went downhill, since the demolition actually caused minor damage to the garage. Damage the contractor claimed wasn't their fault. Finally, the nightmare reached its climax once the contractor left the job unfinished and stopped returning her calls, leaving her with water damage and mold risk, a damaged garage, and $4,450 within the hole.
Make sure your contractor has insurance
Chanel and her husband needed to hire a second contractor to redo the concrete, bringing the total cost of the project as much as $9,650 – a lot more than twice the things they would have paid when the job ended in the actual first place.
According to Chris Fowler, the Mans' insurance policy might not have helped them cover the damage to their garage, but insurance coverage is still very important when renovating with contractors.
“That's why it is essential to ensure that the contractor they hire has their own commercial general liability policy, if they damage the house, you can make claims against their policy,” he says.
In Chanel's case, she either would have been able to file a lawsuit against the company or have their insurance company pay to repair the damaged garage property. Instead, they reported the incident towards the Better Business Bureau, an organization that attempts to help consumers get compensation when dealing with business malpractice. Unfortunately, she explained it wasn't easy and they ended up getting very little back.
In the end, Chanel's reno nightmare came to a close and she's moving forward with life, but she learned two valuable lessons about getting work done in your home. Don't hire a contractor unless they can demonstrate they have insurance and do not renovate your home without talking to your insurance company first.