Your contractor damaged your house: what to do first, and whose insurance may pay

Remodels break things. A pipe gets hit during demolition, a tub gets cracked while the tile goes in, a floor gets gouged when an appliance is moved. What you do in the first day makes the rest easier.

First: safety, then stop it getting worse

AAA's checklist starts with safety: address injuries and hazards, shut off utilities if it's necessary and safe, prevent more damage where you can, and keep people away from exposed wires, sharp debris, and unstable structures (AAA).

If you may file an insurance claim, the Texas Department of Insurance advises making only the repairs needed to protect your home from further damage, such as covering holes, and not making permanent repairs until your insurance company tells you to (TDI, PDF).

Document it before cleanup

From AAA (AAA):

• Take photos and video before anyone cleans up
• Gather the contract, payments, receipts, and texts or emails with the contractor
• Save the damaged materials
• Keep receipts for any emergency repairs

Tell the contractor, in writing

AAA's steps: report the damage in writing, ask for the contractor's insurance information, and ask for a copy of their certificate of insurance (AAA). Keep it factual: what happened, when, where, and the photos.

Who may be responsible

AAA lists several possibilities, depending on how it happened (AAA):

• The general contractor, for damage caused by their own work, including accidents like breaking a pipe.
• A subcontractor the contractor hired. Who's at fault then depends on the contract, the insurance in place, and who controlled the work.
• A product manufacturer, if a defective fixture or material contributed.
• You, in some cases. Pre-existing damage or hidden deterioration can make it hard to tell whether the contractor caused a problem or uncovered one. (If it's a problem the contractor uncovered, see unforeseen conditions.)

Whose insurance may pay

• The contractor's commercial general liability policy is often the first coverage to ask about when a contractor accidentally damages your property. AAA notes it's not a warranty for poor work: it may help if a broken pipe causes water damage, but may not pay just to redo work installed wrong (AAA).
• Your homeowners policy may help with sudden and accidental damage, depending on the cause, your deductible, and your policy language. If your insurer pays and another party is responsible, it may try to recover the cost from the contractor's insurer (AAA).
• Workers' compensation matters if someone working on the job is hurt on your property (AAA).
• A bond or a warranty may apply too, but they work differently from insurance (AAA).

Ask your insurer or agent before assuming anything is or isn't covered.

Claim timelines are set by state. In Texas, for example, your insurer must acknowledge your claim within 15 days, accept or reject it within 15 business days of getting everything it needs from you, and pay within five business days of agreeing to pay (TDI, PDF). Your state's insurance department will have its own rules.

If it isn't resolved

If the contractor won't repair it or respond, follow what to do in a contractor dispute: written demand, mediation, a licensing board complaint, the bond, and small claims.

Next time: before work starts

The FTC suggests considering only contractors who are licensed and insured, and asking for proof of insurance (FTC). AAA adds reviewing the certificate of insurance, which shows the policy dates and coverage limits, and keeping pre-project documentation (AAA).

Keep every receipt in one place

RenoBinder keeps the contract, change orders, and payments for each room together, so the record an adjuster asks for is already organized.

General information, not legal or insurance advice. Coverage depends on the policies involved and the facts. Ask your insurer or agent.

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