HEADLINE: Making renovations? Be sure to tell your insurance company
BYLINE: The Lowell Sun
Over the weekend, I attended a party at a friend's house. We got into a discussion about homeowner's insurance and the liabilities associated with a policy.
In particular, my friend had recently purchased a trampoline for his kids. Having gone through a similar experience of a tenant wanting to put a trampoline on a property that I own, I asked him the name of the insurance company that would insure the property with a trampoline. My friend's answer: "I did not tell them."
Since this person is my friend, I felt compelled to tell him that was not a good idea. The obvious response was, "Why?" I then explained that there is a cooperation clause in your insurance policy that states that you are required to disclose things like a trampoline. By failing to disclose such an item, your insurance company could deny coverage if something happened and it discovered the trampoline.
As the party continued, my friend asked me for additional information regarding some housing renovations that he made. In retrospect, I wished I had never asked the first question.
He explained that he was "handy" and renovated his entire basement last winter. He explained that he did his own electrical, framed it himself, did the plumbing, the drywall, etc.
I saw it; it looked really nice. Then I asked if he notified the town that he was redoing the basement. His response: "I did not want to pay for all of those inspections and permits."
Once again, I explained that if there were ever a claim under this policy, the insurance company will do its own due diligence before it pays anything. Many of us don't like paying extra fees for inspections and applications, but you must follow the rules or there could be dire consequences -- if you're not protected under your homeowner's policy.
About seven years ago, my parents got notification from their insurance company (homeowner's) that it wanted to do a routine inspection of their property. During the inspection, insurance representatives asked how long my parents had a pool. My dad told them 1973. A week later, my father got notification from the company that it was dropping the homeowner's policy.
Upset with the company's actions, Dad called me to ask if it could do that. My response was that an insurance company can do anything it wants. I theorized that when my parents originally got their policy, no one asked about a pool. Each subsequent year, I assume, the policy automatically renewed, and my parents did not know they needed to provide this additional information.
The moral of the story is to make sure to read your policy. It is sent to you every year and you must make sure that you don't do anything that could risk coverage being denied.
Courtesy of Hugh J. Fitzpatrick III
Have more questions?
ABOUT FAMILY INSURANCE
Phone # (405) 329-9780
Fax # (405) 823-6917
http://www.gotomypolicy.com
paul@familyinsu.com