The following is a recommendation of coverages and limits to look for. Keep in mind some coverage is required by law and others are optional.

The COI will show the policy dates. Ensure the dates cover the timeframe of your project. This may require asking for a copy of the renewed policies. The COI also shows who the contractor’s insurance company is. Call the insurance company to confirm the stated policies are still in effect. Remember it is a copy of the insurance coverage and just because the policy has dates on it doesn’t mean the contractor didn’t elect to drop coverages.

GENERAL LIABILITY

General liability insurance is an essential part of an insurance plan. Specifically, for a homeowner, it covers third party claims for bodily injury and property damage when the contractor is negligent. Recommended limits are $1,000,000 per occurrence, $2,000,000 aggregate.

WORKERS COMPENSATION

A sole proprietorship, a partnership or a limited liability company in Wisconsin that has no employees, is not required to carry a worker's compensation insurance policy. However, Wisconsin law requires that a contractor who has an employee payroll of over $500 per quarter must have workers compensation insurance. This coverage protects employees for injuries during employment. If your contractor does not have workers compensation coverage and an employee is injured on your project, it could potentially result in a claim on your homeowner’s insurance.

AUTO LIABILITY

A business or commercial auto policy must exist for business owned vehicles. This policy extends beyond exposure for accidents while driving for business purposes to include damage and injury caused during loading and unloading of a vehicle. This is not covered under a personal auto policy.

UMBRELLA

A commercial umbrella policy extends the limits of some primary liability insurance policies like general liability and auto liability. The insurance provides additional coverage on top of the limits on these policies. An umbrella is not a requirement, but a smart added layer of coverage for a potential large loss.

ERRORS & OMISSIONS (E&O)

E&O insurance is a specialized liability protection against losses not covered by traditional liability insurance. It protects a business from claims of negligent acts, errors or omissions committed during business activities that result in a financial loss. E&O insurance policies vary and are written to reflect inherent risks and common exposures particular to the business. If your project involves significant design or engineering, it is highly recommended the contractor carry E&O coverage. The policy will assist in covering faulty workmanship, materials or design. The limits should be similar to the size of your project.

You should contact your own insurance agent to notify them before a remodeling project begins. Your agent can help you through any insurance questions regarding remodeling and repairs and confirm your current homeowner’s policy won’t be compromised or if additional home or possessions coverage is required and when. Both the homeowner and the contractor need to be covered should something go wrong.