Short answer
Three policies matter: the contractor’s general liability (damage they cause), their workers’ compensation (injury to their people), and your own homeowner policy (the building and your possessions).
Call your own insurer before work starts. Several policies restrict cover during major renovation, and many restrict it heavily if the house is unoccupied for a period. Both are common in a remodel and both are discovered too late.
Workers’ compensation is not universally required in Texas. Ask directly whether your contractor carries it, because if they do not, an injury on your property becomes a question you want to have asked in advance.
General information from a builder’s perspective, not insurance or legal advice. Confirm your own position with your agent.
On this page
The three policies, and what each covers
| Policy | Held by | Covers |
|---|---|---|
| General liability | Contractor | Damage the contractor causes to your property or a neighbor’s |
| Workers’ compensation | Contractor | Injury to their own workers on your site |
| Homeowner policy | You | The building and your contents — subject to renovation and vacancy terms |
| Builder’s risk | Usually the contractor, sometimes the owner | The work in progress and materials on site, against fire, storm and theft |
| Auto liability | Contractor | Vehicles — relevant more often than people expect on a residential street |
The gap people fall into is between the first and the third. A contractor’s general liability covers damage they cause. It does not cover a storm that hits an open roof, and your homeowner policy may restrict cover precisely because the roof was open. Builder’s risk exists to sit in that gap, and on a substantial project it is worth establishing who carries it.
What might your own policy not cover?
Three provisions to ask your agent about, by name:
- Renovation or alteration terms. Many policies limit or exclude cover during significant structural work. Some require notification; some require an endorsement.
- Vacancy or unoccupancy clauses. If you move out during the work, cover can reduce sharply after a defined period — often far shorter than a remodel lasts. This is the single most commonly missed provision.
- Contents in storage. Furniture moved to a storage unit may not be covered by the homeowner policy at all once it leaves the property.
The remedy is a phone call before work starts, and a note of what you were told. Ask specifically: “We are doing X for approximately Y months, and we may be out of the house for Z weeks. What changes about my cover, and what do you need from me?” Get the answer in writing.
Insurance, registration and permits in the contractor's name are the three things that decide who carries the risk while your house is open. They take one conversation to establish.
Jan Revels is registered with the City of Dallas, carries general liability insurance, and pulls permits in the company's name.
How to verify a contractor’s cover
- Ask for a certificate of insurance sent directly to you by their insurance agency. Not a copy forwarded by the contractor. Legitimate contractors are used to this and their agent does it in minutes.
- Check the dates. A certificate expiring in the middle of your project covers half of it.
- Check the coverage amounts, not just that a policy exists. Judge them against the value of your house, not the value of the job.
- Ask to be named as an additional insured where appropriate on a larger project.
- Ask whether subcontractors carry their own cover, and whether the contractor verifies it. A general contractor who does not check their trades has a gap that becomes yours.
- Keep the certificates with your project records.
These sit alongside the other checks in how to vet a contractor in Dallas.
Workers’ compensation in Texas
Texas is unusual: private employers are generally not required to carry workers’ compensation insurance. Many contractors do; some do not.
Why it matters to you as a homeowner:
- If a worker is injured on your property and the employer carries no workers’ compensation, the routes to recovery change, and one of those routes can involve you.
- Ask the question directly, and ask it about subcontractors as well as the general contractor.
- If the answer is no, ask your own insurance agent what that means for your policy, and make the decision with the information rather than without it.
- Do not rely on assumption. This is the item that is most often assumed to be covered because it would be in most other states.
Why are permits a liability question?
Permits are usually discussed as bureaucracy. They are also a liability instrument:
- A permit pulled in the contractor’s name puts responsibility for code compliance on the contractor. Pulled in yours, it sits with you.
- Inspections create a record that the work was done to code, which is what you show a buyer, an appraiser or an insurer after a loss.
- Unpermitted work can complicate a claim. If a fire or a leak traces back to work that was never inspected, the position becomes considerably more difficult.
- It follows the house. Unpermitted work surfaces at sale or when the next owner applies for a permit of their own — see permits and trades in Dallas.
A contractor who suggests skipping a permit is proposing that you take on a risk so that they can move faster. That is worth naming out loud.
What to do before work starts
- Call your insurance agent and describe the project, the duration and whether you will be living there. Get the answer in writing.
- Collect certificates from the contractor’s insurer directly.
- Ask about workers’ compensation, for the contractor and the subcontractors.
- Confirm permits will be pulled in the contractor’s name.
- Photograph everything — every room, inside cabinets, the exterior, the neighbor’s fence line. Dated photographs settle disputes about pre-existing damage instantly.
- Move valuables out and check whether they remain covered where they are going.
- Agree site security — who locks up, where keys are, whether a lockbox is used and who has the code.
- Tell your neighbors. Not insurance, and it prevents a large share of the disputes that end up involving it.
Key takeaways
- Three policies matter: contractor liability, workers’ compensation and your own homeowner cover.
- Call your own insurer before work starts. Renovation and vacancy clauses are the usual surprises.
- Contents in storage may not be covered by your homeowner policy at all.
- Have certificates sent by the insurer directly, and check dates and amounts.
- Workers’ compensation is not universally required in Texas. Ask directly.
- Permits in the contractor’s name place code responsibility with the contractor.
- Photograph the whole house, dated, before anyone starts.
Frequently asked questions
Does my homeowner insurance cover a remodel?
What insurance should my contractor carry?
Is workers' compensation required in Texas?
What happens if a storm damages my house mid-remodel?
Why should the permit be in the contractor's name?
Jan has practiced interior design in Dallas since 1997 and founded Chateau Concepts in 2001. She holds a BFA in Interior Design from the University of North Texas. She designs and general-contracts residential and commercial projects across the Park Cities, Preston Hollow and North Dallas. Read her full profile →
Written and reviewed by Jan Revels before publicationWork with Chateau Concepts
Jan Revels handles both sides of a project in Dallas and the Park Cities — the design and the build.