The pandemic is causing people to rethink where they work, live and play. That’s leading to more relocations and home renovations. Today’s newsletter provides some tips to help your home renovation project go smoother. Note that I used the word smoother rather than smoothly because few renovation projects go smoothly.
Thinking about the goal of your project will help establish its scope. For example, if it’s a dream kitchen in your forever home you may want to splurge. But if it’s to improve value for resale you need to be careful spending what you may not recoup. There’s a reason few home flippers use expensive materials
You need to find the right contractor. Look for referrals, research reviews and check the Better Business Bureau for complaints. Conduct interviews to gather information and establish comfort level. Questions to ask before getting down to details:
- What kind of projects do you do?
- Do you use subcontractors? Who?
- Do you have customer references?
- Can you provide proof of insurance that protects you and your workers?
- Can I see your “certificate of liability” (to ensure the limit is at least as high as the project value)?
- Are you bonded to ensure the project gets completed on time?
Once a contractor is chosen, you establish a contract that includes:
- The details of the project
- Start, interim and end dates
- Information about permits, licenses and inspections
- Payment amounts, due dates warranties and guarantees
The contract should not include:
- Excessive up-front payment. No more than one-third.
- Waiver of subrogation. This waiver would prevent you from recovering losses from a third party in a lawsuit if your contractor is negligent.
Anticipate Supply Challenges
Projects may take longer and be more expensive than expected due to demand for materials and distribution delays. It can be helpful to choose materials before the work begins. Budgets and timeframes seen on TV home renovation shows are generally unrealistic.
Have your alarm company install a temporary central alarm system for construction, then replace it with a permanent system upon completion.
Review fire safety measures with your contractor. Here’s a list of measures that comes from insurance industry analysis of renovation fire incidents:
- Never allow oily rags to pile up
- Never store paint or solvents near furnaces, water heaters or vehicles
- Dispose of waste materials like wood shavings and oily rags daily
- Keep flammable materials offsite if possible
- Avoid portable heaters
- Implement “hot work” guidelines. Hot work includes welding, soldering and cutting that may generate sparks. Hot work areas should be cleared of combustible materials and wooden floors should be properly covered.
- No smoking
Your homeowner’s insurance covers your home as described in your insurance contract so does not automatically cover major additions or renovations. “Major” would not include something like new kitchen cabinets or appliances, but it would include structural changes and most projects requiring a permit.
If you’re doing a project that might be considered major, contact us at Desert Insurance Solutions. We’ll check with your existing carrier if they’ll approve it under your existing policy. If not, we’ll secure a proposal for a “Course of Construction” interim policy, either from your existing carrier if they offer that product, or an alternative carrier if they don’t.
It is unlikely your project will go off without a few hitches. Stay positive and expect bumps in the road as part of the process. When they happen, think “how do we fix this” rather than “whose fault is this”. It’s not always easy but with some patience and perseverance your renovation can lead to a very satisfying reward!
This newsletter is timely for me since we’re starting the internal build out of our new Scottsdale, Arizona office at 13430 North Scottsdale Road (one mile south of Kierland). When it’s completed in February I’m hopeful our Arizona clients will feel comfortable enough to swing by and say hi. Our California office remains open for business and you’re always welcome to contact me in whatever way works for you: phone, e-mail or text.