Building your own house can be an exciting and highly rewarding experience, but it can also be a risky one. There are many perils that can occur with any construction project. While under construction, your new home is not covered under your existing home insurance policy. In order to insure your home during construction, you will need to purchase a Course of Construction insurance policy.
Course of Construction, or “Builder’s Risk” insurance covers your home while it is being built. The insurance policy covers a construction project that begins with the framing of a house. The policy will most likely provide for coverage against fire, lightning, theft and vandalism. Most Course of Construction policies do not include coverage for bodily injury or damage to others’ property. Additionally, many Calgary home insurance companies will insure the property for the anticipated finished replacement cost, so it is important to estimate a figure based on total building costs, including building permit fees, electricity, and other miscellaneous costs.
“In order to insure your home during construction, you will need to purchase a Course of Construction insurance policy.“~Chad Mullen, Lane’s Insurance
Even if you are only doing smaller renovations to an existing house, it is still a good idea to contact your insurance broker to determine whether the renovations will impact your home insurance policy. For example, if you plan to vacate your house for more than 30 days during renovations, your home would be considered “vacant”, which would void your insurance policy if you do not notify your insurance broker within those first 30 days. It is common for homeowners to avoid telling their insurance company about their construction projects in order to elude higher premiums, but failure to do so can end up costing you money and creating headaches if a mishap should occur.