Turning A Commercial Building Into A Residential Building, What Type Of Insurance Would I Need?

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   dmrozek

   Ann Arbor, MI

   This is a little more complicated than it appears on the surface.  The biggest determining factor is the use of the building.  If the building is still being used for a business, it needs to be covered under a commercial package with property and liability coverage.  If it is no longer being used for a business, you could insure it as a home.  If it's a major renovation it would be prudent to add a builder's risk endorsement to the home policy. if it's available through that company.  This would give coverage for building materials that are on site but not yet installed.  If this is the case, the replacement cost would be estimated at the cost when the renovation is finished.
   
   If the goal is to save money, my question would be this:  do you want to save money in premiums or if there's a claim?  Insure it correctly, whether it's commercial coverage or a home.  These are small dollars in comparison to what you would lose if it wasn't insured correctly.  The premiums on a home policy are undoubtedly lower than for a commercial property, but don't take the chance that your claim is denied because you're carrying home insurance on a commercial property.
   
   Find a good agent you can trust.  He or she will be able to speak with the company and get you the coverage you need and, in the long run, save you money.

   Answered on December 3, 2013

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