When Homeowners accidentally become General Contractors
One of my biggest concerns is when our residential customer (aka a homeowner like you) hires a contractor to do work (like a kitchen or renovation) and the contractor cause major damages and the homeowner is left cleaning up their mess. Essentially, our homeowner becomes a general contractor by accident and didn’t even realize it. I have two examples and an easy piece of advice:
Example 1: A few years ago, we had a great client who hired the local landscapers to take a few trees down in his yard to avoid an risk of the trees falling on his house during a storm. I love this diligence and pride of ownership because it shows that my client is trying to prevent a claim. During the tree removal, the contractor made an error and the tree that they were removing fell on my clients home resulting in over $150,000 of damage and my customer being displaced for over 2.5 months. Luckily, our policy covered him for the damages, but guess what? The contractors policy DENIED coverage or negligence because he was not covered for tree removal. Our client had this claim on his policy for 5 years and dealt with surcharges all because his contractor wasn’t insured properly.
Example 2: This past winter, our client decided to complete a renovation without letting us know. They got permits from the town and obtained the proof of insurance from the General Contractor. They did everything that they thought they should do to protect themselves. I mean even the township gave their blessing right? What they didn’t do was also required certificates from ALL subcontractors. They also chose to vacate the home during the renovations. When they came back they had $50,000 of damage to their heating system and piping because the subcontractor had completed faulty work. That is when I got the phone call. Turns out the subcontractor who was hired by the General Contractor had NO coverage and the General Contractor was not excepting responsibility. Our homeowner’s policy also excludes renovations or construction when the client vacates the home. The client had to pay 80% of the damages out of pocket. This was an awful situation to go through and it could have been covered all the way had we gone through the proper process.
In both of these cases, we wish our customers called us. Our recommendation would be
Call us- always call us, it is never a bother
Have all contractors AND subcontractors list the homeowner as Additional Insured on their policy and indicate their scope of work on a certificate that we can keep on file
We suggest finding an agent who cares (hint hint…We do!)
There are carriers who spend billions to advertise saving time and focus exclusively on saving money, but sometimes its about making sure you are property taken care of!