Insurance needed if doing rehab with a friend

[Sean S.]

Hi,

Any advice would be greatly appreciated!!

I am going to be flipping my first home soon. I am planning on having standard home insurance with a general liability coverage of 1mil. I was considering also getting a 1 mil umbrella policy for year round in case anything happens after I sell the property. I will be contracting out the major projects, but I will paint, do demolition, and kitchen cabinets with a friend of mine. My friend does not have general liability coverage since he doesn't do this work typically. Since he doesn't have this coverage, my insurance agent is telling me that he wouldn't be covered by my general liability policy. Would my umbrella insurance cover me if something happened to him? Is there any alternative options for how I can ensure that I am covered in case of an accident with my friend? Any experience with a homeowner liability waiver form?

[Kevin Hoag]

Sean, If you are just doing a residential rehab you can go to Foremost and purchase a vacancy rehab policy. This can offer you up to 1 mil in liability and will cover anyone working on the home. You will not want standard home insurance as that is not designed for rehabs or vacant homes. What you can look into is to see if your home policy will allow extended liability coverage to a second dwelling. This will allow you to get that additional 1 mil without buying an umbrella policy. Also as soon as you sell the home you know longer are responsible to carrier insurance on the property. In fact you no longer have an insurable interest in the asset to even carry insurance on it. Once you sell your done with that project and can move on.