Quality Building & Remodeling

Homeowners insurance; are you covered?

I’m not an insurance agent and in no way an expert on homeowners insurance. However as a Remodeling Contractor I have learned a lot about insurance. With winter storms on the way by the time you read this it may be too late to be of much help.
Homeowners find out after they have suffered major damage is they have a major out-of-pocket expense. How can that be you’re thinking? Often someone has sold you the least expensive policy to meet the banks requirements. When the house was bought basic coverage was offered to make the sale with no explanation of coverage. Once you have a policy you never think about it again every year you get a bill to renew and you send in the money. You never hear from your agent again.
Keeping it simple there are 2 basic types of policy’s Replacement cost and an Actual cash value policy.
We have found that homeowners with a cash value policy often don’t receive enough to cover the repairs. This policy pays cash value minus depreciation and only for the area damaged. So if you have a discontinued product or style and or even a color you often end up with a mismatched repair.
Replacement policy pays to bring the home back to original by replacing all the affected area. This means when the repair is complete it will look as good as new.
Another item you need to check is if you have an addendum to bring the house up to code. When dealing with structural damage the building department will require it meets the most resent building code. This can be a major upgrade if your home is over 10 years hold or if there was no code when the house was built. This can be a major added expense.
Exclusions we have seen over the past few years are mold related repairs. This is why it is even more critical than ever to address any water related damage to your home immediately.
Another new one is lead. If your home was built before 1978 it is very likely the paint is lead base. If you must have repairs done by a contractor and your home was built before 1978 the contractor may have to implement lead safe procedures. This will increase costs.

Here is the one thing that really bugs me as a contractor is the insurance company tells you that you need to get 3 estimates. That is the law, company policy or something of that nature. I have read all my policies and none require that I get 3 estimates. After a major climatic event you will have trouble just getting one estimate. Find a contractor familiar with doing insurance work is your best way to deal with the repair. The insurance is looking for a detailed estimate not a lump sum estimate. An estimate that says fix roof $10,000.00 won’t work and it will get thrown back. You shouldn’t even accept that estimate on any home repair or improvement project.
Take the time to call your agent before you need him. Ask him to explain the policy coverage. Better yet know some things you should be looking for in the policy. Look for answers to these few questions;
1. Is this a replacement policy?
2. Code updates are they covered?
3. Water damage covered and what type is covered?
4. Hurricane, tornado and earthquake?
In no way is this intended to be legal advice or all the questions to ask. This is just a few of the key areas I have experienced as a contractor and as a homeowner myself. The best advice I could give is contact a contractor right away. It is best to have the contractor onsite when the adjuster is reviewing the damage. Second best piece of advice I can offer is to get a copy of the full policy and read it than ask questions. They aren’t that hard to read or understand. And it could save you thousands of dollars someday.
We are here if you have questions or need our services in northeast Pennsylvania. To learn more about our company visit our website at http://www.qualitydesignbuild.com. If you have an immediate need call us at 800-404-3995.