Before the first nail is hammered, you should check with your insurance representative to make sure your home, the contractor and the subcontractors have adequate insurance coverage.

ADDITION TO YOUR HOME

Don't make the mistake of waiting until an addition or extra room is completed to increase the insurance coverage on the structure of your home. If the new addition is destroyed or damaged before insurance coverage has been increased, you may be responsible for the cost of repairing or rebuilding the addition.

We suggest that you contact your insurance agent or representative before or shortly after the construction begins to increase the insurance coverage on your house to reflect the increase in the cost to rebuild the structure.

CONTRACTORS AND SUBCONTRACTORS

When hiring a general contractor, you need to make sure that the contractor has workers compensation. Workers compensation pays for medical and rehabilitation expenses, and lost wages if the workers sustain injuries on the job. Injured workers may sue you if the contractor does not have proper insurance.

In most home improvement projects, the contractor subcontracts the builders, electricians and plumbers. The workers hired may not be full-time employees of the contractor and therefore not covered under the contractor's workers compensation policy. While some independent builders, electricians and plumbers may carry their own workers compensation coverage, others may not.

You should verify the insurance coverage of the contractor and the subcontractors. If the coverage is insufficient, you may need to fill in the gaps by extending the limits of the liability portion of your homeowners policy.