Deposit protection for your renovation or repairs ensures that the work is still carried out, although by another contractor or builder, in the event that your contractor or builder is unable to do the job. Your deposit protection coverage may also give you the option of having your money refunded in full.
As you may well know, every tradesman, contractor, or building company will require a deposit on a job before any work begins. Now, unfortunately, there are companies that have to fold up or stop operations, which happens for a number of reasons. These reasons include filing of bankruptcy, the need to liquidate assets, sudden death of the principal — whatever the reason, the inevitable outcome is that your home improvement will be delayed or cannot even begin.
When you fail to secure your deposit or the company you hired does not offer deposit protection, then you will have lost your money. On top of the money you may lose, deposits without sufficient insurance will also lead to delays on the construction or renovation of your home. And if that home were an investment property, you lose more than the deposit; you may also suffer loss of potential profits, with each day that goes by that your property is not put up for sale or rented.
When considering deposit protection, make sure you read your coverage thoroughly. Whether you get an independent insurer that handles home improvement deposits or use the contractor’s deposit protection, you should be aware of what you will be entitled to, should the company cease to operate.
It is rarely a simple thing to do a home improvement. It does not matter if you are doing it for the entire house or just focusing on certain spaces; the point is to make sure you have everything in order and that you have sufficient protection for your deposit, and for your project.