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When hiring a contractor to add value to your home investment, it makes dollars and sense to verify the contractor’s Workers Compensation coverage. Otherwise, you might be responsible for injuries incurred by the workers while they are remodeling or repairing your home.

With this in mind, take a look at some important insurance issues before you select a contractor. To start, verify that the contractor you want to hire carries Workers Compensation coverage. If a contractor does not have this coverage, workers who are injured while working on your home could sue you. You might also want to see a copy of the contractor’s Workers Compensation policy and ask the same of subcontractors such as electricians and plumbers. It is important to make sure all of the contractor’s employees are covered — full and part time. It is advisable to get insurance policy numbers and to take that extra minute to call and verify that the insurance is still in effect.

You can also check the contractor or remodeler’s credentials, including whether the contractor or remodeler is licensed and/or a member of an applicable trade group. Of course, you will want to compare costs and solicit bids from more than one contractor or remodeler. When doing so, get all bids in writing and make sure each bid includes building specifications (what is being worked on and to what extent), labor costs, material costs, and time needed to complete the project. This will protect you from unforeseen costs while further protecting you from future misunderstandings and project mishaps.

You can call Better Business Bureau (BBB) to quickly and easily verify local references. The local BBB office will also be a good source for letting you know if there have been complaints made against the contractor or remodeler.

Lastly, most contractors and remodelers will gladly show you work done at other nearby homes. Take them up on this offer and see for yourself their workmanship and check customer satisfaction. Talk to former clients and see what they think of the contractor’s ability to meet their needs while staying on schedule and within the projected budget.

If you wanted to, you could build a panic room for protection from robbers or kidnappers. But what about protecting your belongings when you’re not home? Perhaps you really don’t want to install an alarm system — or maybe you do. Either way, here are some no-cost and low-cost tricks to make your protection more complete, and help keep your belongings away from thieves.

Outside Areas
Begin with the landscaping, which is the first thing a burglar sees and the first thing he will assess. To make it harder for a burglar to hide and gain entry:

• Prune lower limbs from any big trees.
• Trim bushes so a man could not use one for cover.
• Move any decorative trellises away from windows or porch roofs so they cannot be climbed for second-floor access.
• Consider planting thorny bushes below first-floor windows, and be sure they are close enough to the house so that an adult could not wedge behind one to jimmy a window without getting scratched up.
• Remove any trees or bushes beside exterior doors. They can hide a burglar from passing cars and they can also hide intruders from your sight when you answer the door.
• Make sure all ladders and tools are secure inside the house, not inside a garden shed.
• If your yard is dim at night, install the brightest, biggest lights you can afford for all entries to your house. Use them. Turn them on when you leave the house at night; set up motion detectors to turn them on when you are away.

Inside the Home
Windows generally provide easier access for criminals than doors. Here are some window tactics:

• Buy special window locks at your hardware store for all first-floor windows and any second-floor windows accessible from a porch or garage roof. DO NOT hang the keys on clever little hooks or nails beside the window. Crooks know that one and will simply break a pane and reach around until they find the key. (But be sure the whole family knows where the keys are in case of emergency.)
• Don’t demonstrate the easiest window to enter by climbing in it. If a family member regularly forgets his or her key, consider leaving keys with a trustworthy neighbor for emergency use. DON’T CLIMB IN THE WINDOW EVER. Even amateur burglars can figure that one out, especially if they’ve seen you do it and figure the neighbors won’t notice.
• For sliding windows, use the same techniques as for sliding doors, below.
  Some burglars like to enter like a guest, through the door. Here are some ways to discourage that sort of burglar:
• Make every entry door solid core wood or metal; hollow-core doors are easily kicked in. The door should fit the frame snugly, with no more than 1/8 inch between door and jamb. If the gap is larger, replace the door, or install a heavy-gauge metal strip available at the hardware store.
• Replace doors with decorative glass windows or panels. If that’s too expensive, install break-resistant plastic panes, or install a decorative grille over the glass.
• It’s unlikely, but if an entry door has hinges on the outside, rehang it with hinges inside. If that’s impossible, reinstall it with pinless hinges. Burglars can pop pins and take off the door to enter.
• Make sure locks on all sliding glass doors are sturdy. Then use a solid stick of wood or broom handle in the track of the closed door.
• Adjust door rollers so the door cannot be lifted out of its track.

A Few More Hints

• Close your garage door when you’re away, whether or not it also leads into the house. An empty garage equals “no one’s home.” Cover garage windows completely with shades or curtains so no one will know if there’s a car in there or not.
• Don’t leave notes on entries; if you were home, you wouldn’t leave a note. Not even for FedEx.
• Don’t hide keys in the yard; burglars know all the usual places, even those cute little garden toads with hollow bellies.

Property insurance policies often give policyholder’s the option of insuring to replacement cost value (RCV) or actual cash value (ACV). Which option should you consider?

In short, the difference between ACV and RCV is depreciation, or wear and tear.

ACV says that the property that was lost has probably depreciated by some amount over time, and attempts to inject depreciation into the equation. For example, say the property destroyed was a sofa that would cost $500 to replace. However, the sofa was 10 years old and although it might have been in good shape for a 10-year-old sofa, it was not brand new. Some wear and tear inevitably occurred.

Under ACV, the insurance company determines that $25 of depreciation occurred each year since the purchase so that the old sofa was only worth $250 at the time of the loss. They would then pay you $250 minus any applicable deductible and you would in a sense be paying an increased deductible in the form of the $250 depreciation. More precisely, you would be paying the difference between the replacement cost, the amount the old sofa depreciated by, and any deductible. You would be “co-insuring” that amount. That’s ACV.

RCV is, simply put, the cost of replacement of the lost property with an identical or similar piece of property. In our sofa example, if it costs $500 to replace the sofa, the insurance company will pay you the $500 less any applicable deductible. Case closed. It does not matter the sofa was showing the effects of age and you couldn’t possibly get $500 for it.

The question of which option to take cuts to the heart of what insurance is all about — making the insured whole again. ACV sometimes falls short. RCV, on the other hand, can create a beneficial state for the insured in some cases.

For example, forgetting any sentimental value the original sofa may have, if it is old and worn, but the insurance covers RCV, obviously the insured will benefit by receiving funds for a brand new sofa to replace the old one.

A more dramatic example might involve the loss of an old house in a fire. The house might have only been worth $200,000, because the components of the house, i.e., roof, HVAC, etc., were approaching the end of their life expectancy. Obviously, replacing the house with one containing similar features might result in a higher property value due to the new features.

Some insurers require that, in order to obtain the full replacement cost of the property, repairs must first be completed. They might pay the ACV up front and hinge the remaining payment of the difference between RCV and ACV on the actual repair or replacement being completed. This prevents the insured from pocketing the money and gaining financially from the loss, but the result of replacement at RCV is still beneficial and therefore, seems worth the small additional cost of coverage.

There is at least one caveat regarding the benefits of RCV, however.

David Patterson, CEO of Medici Insurance Services notes:

“Given the irrational real estate market, replacement cost may in many cases be less than actual cash value. Although depreciation has theoretically occurred,” according to David, “the run up in home values in recent years may have created a situation wherein the actual cash value of the existing home may exceed the cost of replacing the home with one that has similar features and qualities. Thus the extra cost of purchasing RCV may be inappropriate.”

As always, consult with your agent to determine which option to go with.