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Welcome to Let’s Build with Armada, the podcast where Washington homeowners learn how to remodel with clarity, strategy, and confidence—on a schedule that follows real projects, not a rigid calendar.
I’m Charlie Carter from Armada Design & Build. After years of working across the greater Seattle area, I’ve learned that successful remodeling isn’t about luck. It’s about planning, transparent conversations, and understanding how every decision—from windows to insurance to material selections—affects long-term value.
In each episode, I sit down with experts to answer the questions homeowners genuinely care about:
- Why your PNW windows cry every winter
- Financing options that actually make sense in 2026
- How to not get burned by a cheap insurance quote
- What adds value in Seattle… and what just burns cash
- How to plan a DADU without turning your backyard into a 2-year construction zone
Whether you’re preparing for a kitchen or bathroom remodel, planning a full-home upgrade, or exploring a backyard DADU for equity or rental income, this podcast gives you the clarity you need to move forward confidently.
Listen here, watch more real projects on our YouTube channel, and visit us when you’re ready to build with confidence.
And don’t forget to follow the show—so you never miss an episode that could save you time, money, and stress.
Visit the Armada Design Center in Bellevue when you’re ready to start planning your own home transformation!
📍 15600 NE 8th St. Suite O2, Bellevue, WA 98008
📞 425-587-8286
🌐 https://armadabuild.com/?utm_source=transistor
Everything is getting more and more expensive every day. Stuff like that's not covered and most people don't realize that. That's not a hazard. It's not a hazard. Why is that the case that those people are so underinsured? Insurance company, they want to pay out as little as possible. Do I need to hire a lawyer to read my insurance contract? It's important that every year you look at the policy to make sure that you're adjusting for inflation, for, you know, builder costs, things of that nature. You can rebuild that home any way you want. You don't have to use the same platform. The insurance company actually write you a check. had a lot of instances where people get way more money than they were ever expecting to get. So, they just want an essay. They want a good wordy essay that you like that feels like an A. As long as you submit it properly, they'll approve the bid up to the policy limits. [Music] Hello, welcome. Hi, my name is Charlie Carter and I am with Armada Design and Build in Belleview, Washington. And uh if you're here, you're watching, uh we appreciate it. Thank you very much. We want to give, like everybody else in the world, the podcast arena a try. And so we're here, this is it. This is our very first endeavor. We have a guest here today. His name is Michael. Uh, and he is here to talk with us about insurance, uh, and how that affects your home and what is important about that and some of the myths and things that people get wrong or don't understand. We're going to give it a go. Welcome to the Let's Build with Armada podcast. I want to jump right in, get to some information, but when you're auditing a typical homeowner's policy, where do you start and where do you see the biggest gaps um for folks? If you've gone over their policy and you're looking at it, what is the biggest gap or missed thing that you see the most common? Yeah, I would say probably the the dwelling coverage. One of the main things we want to look at is um you know the overall size and interior quality design of the home and make sure that there's enough reconstruction cost involved in case there is a total loss, right? A lot of times you find people are underinsured to where there's a loss. So, we'll look at the year the home was built, the square feet, whether it's got like granite countertops or for micica, and we have a what's called the replacement cost estimator, and we'll put all that into our replacement cost estimator, and it'll give us a a redesigned build cost based off what um builders are charging in that current area. So, break it down by zip code. So, that's the main thing. Okay. So, they so the replacement cost or what the amount of the policy, right? The cap amount that the in insurer in your case, all state, right? in case all state would pay to rebuild, replace that home. Exactly. So, you would look at the size of the home and a lot of times you want to take in location as well. If you have a home that's, you know, built on the side of a hill, uh, you know, builders are going to charge more because it's harder to get materials in and out. So, you don't always want to just look at the structure itself. You also want to look at the location cuz contractors will charge, you know, if they got to use cranes and stuff to get materials down there. You want to make sure you've got enough coverage to offset those additional fees to rebuild your home. Yeah. No, I get it. And so that's you and I had that conversation. Just so you know, Michael is my insurance agent. Um, so that's how I've known him. Uh, I was actually insured with that agency before Michael took over and then he took over and things got a lot better and uh, so I just have stayed with him. So I don't know, going on 20 years or or something like that. This came up when I was doing a project for some people that had a fire at their house. And this has been oh boy howdy five, six, seven years ago and I called you after that because what essentially was learned going through this process and ultimately what we wound up building the project and helping these people rebuild their home. But what was was we found out was that their maximum value, the total policy limit was well below the threshold of what it was going to cost to put the house back together the way it was. Now, in this case, and most of the time, and I want to talk about this a little bit, too, but I'll just touch on this quickly. And in this case, they were putting the house, they were building the house differently than it was. Mhm. Right. So, it was going to it was going to be different. We were doing different things. And so they recognized it was going to be more money, but just to put it back the way it was, they were well underinsured. Sure. And so then after that, I called you and we talked about my house um and also found that my number was well low. And so we had to go through some things to kind of pump that number up to get it to a point that it felt like it was a reasonable number for me to to feel like, okay, I have enough coverage if if something, you know, goes bad. So what why is that the case that those people are so underinsured? Well, a lot of times what happens is like when you first do the home policy, they'll do the initial assessment and then at that time it's properly insured. And um the majority of home policies are paid by mortgage companies, right? So a lot of times when the renewal comes out, since it's not part of their day-to-day, you know, pay that comes out of the mortgage payment, most people don't even look at the renewal. So insurance agents will send out notifications, hey, let's review your policy. But since it's not a direct payment out of their pocket, it's in their mortgage. They just kind of let it slide by. So as years Exactly. So as the years go on, you know, cost and the value of the home goes up, but the policyy's never been reviewed. So it's important that every year you look at the policy to make sure that you're adjusting for inflation for, you know, builder costs, things of that nature. Plus, if you improve your home, like the ADU you were referring to, you know, we have no way of knowing that unless you call up and let us know. So, uh, it's important to review that so that if you do have a total loss, as the value of your home goes up, we can increase the coverages along with your home value so that doesn't happen. We see a decent amount of it, you know, stuff that comes in and most of the time is in that situation where people are wanting to, you know, take the payment from the insurance company and then pair it with, you know, two $300,000 of their own money and then they're going to rebuild it quite differently, you know, than what it was. And so that's the ones that we get involved in. But we do find still that, you know, the insurance company comes back and they're like, "Oh, the value did uh the adjustment, I think they call it, right? Where they go in and they do their estimate kind of thing and then I've seen them, they'll give it to the person, the homeowner, and they send it to me and it's $100,000 and my number that my estimate quick number is, you know, twice that maybe." Sure. So what why this giant disparity between what the adjustment says like oh we'll pay you $100,000 and then when I look at it I see that my numbers and my cost are you know maybe twice as much or you know 50 60 80% more. Why what's going on with that giant disparity? Sure. So insurance companies have like a built-in what they call estimator to where like in a certain zip code let's say they've had so many losses. Well, they look at the average what they paid out for labor in those losses and they try to come up with like a standard amount of what they're willing to pay for labor. Um, and then so what happens is is when they get the initial adjustment, it's normally always low from the insurance company. They always it's always less. And then what happens is is the builder, you know, gets that or the homeowner and then whoever they're working with hopefully knows how to work with the insurance company and they'll send over the detailed report that the insurance company needs and nine times out of 10 they will adjust that number up to to get the the insurance. Yeah, it seems like that's kind of been the case is that most of the time and so what we have done and I don't know I mean I've never even asked you about this really that the way that we have done that is that when we're working with an insurance situation is that we generally wind up creating two estimates. We create the estimate that is the put it back the way it was as closely as we can estimate which is what the insurance is responsible for. Sure. And then often we're doing the estimate for the project that the homeowner really wants to do. Yeah. Which is the, you know, move the kitchen or do the addition or, you know, whatever the change is kind of thing. And so that first estimate is is the tool for the homeowner to go to the insurance company and sort of have their argument about, no, it's not 100,000, it's 200,000, you know, to kind of get the money out of them. And we have done this and I and I've done it a lot is that we'll make an Excel spreadsheet and then we will put side by side our estimate and the adjustment like the drywall, you know, the the adjustment says it's $2,000 and we know our cost is going to be five. Yeah. And so then we can show where the gaps are. And I do have to be honest that there are often a few categories that the adjustment actually has more money in it than we need. Sure. Um but most of them are low. Yeah. Absolutely. So, and then so talk talk about that a little bit in terms of that. Why is that? Are they just trying to get away with it? I mean, it just feels like a little bit of dirty pool that you know, like, oh, if they'll take a 100red, we'll we'll be glad to give them 100 and they'll walk away. Like, what's going on with that? Well, a lot of it really depends on the adjuster, right? How long they've been doing it for. So, a lot of times when they first look at it and give you the their bid from the insurance company, they're just looking at photos. They haven't actually been on site and walked around and seen all the damage. So, their initial um offer is based on photos and you know, they're expecting the builder or the the homeowner to come back with, no, here's the updated list. Here's actually what the damage is. And as you know, and if there's a huge difference between what they offered and what um the you know, what the builder is requesting, they can send out an on-site appraiser, and that's a lot of lot of times a way to resolve that difference. But with insurance companies, the main thing is it's harder to do um a like a a small job versus a big job. Like let's say you have a water leak in the home and it's like $15$20,000 worth of damage. That's when you have somebody who comes over and it kind of gets nitpicky. Well, let's say you have a total loss, right? And the house burns to the ground. You can rebuild that home anyway you want. You don't have to use the same platform. The insurance company actually write you a check for the limits on the policy. So, it just depends on the situation. Um, you know, insurance company, you know, they want to pay out as little as possible. They want to try to keep the builders honest is how they look at it. So, they're going to negotiate with them back and forth to, you know, save money and m maintain their profit. Absolutely. Okay. Well, let me throw this one by you. This is interesting. It's one of those things that I mean, this is one of the great things about this podcast, right? Is that um we're doing things that I know a little bit about and that I'm in and around quite regularly. Um, but I just have this sort of running dialogue with myself. So, I've got one here for Michael that that I want to throw out there that I have often found is a little bit of a frustration and a weird way that the system works here. So, so let me set this one up for you and I know you're going to get this right away and there's probably a ready answer for it, right? But what I find interesting and a little bit as a dichotomy maybe or whatever sort of this weird juxtiposition is that is I'm a homeowner and I select an insurance company and I pay them money on a monthly basis, yearly basis, right, to insure my stuff. Absolutely. And then something happens and now I need to use my insurance for the purpose in which it was intended. there's a car wreck, something happened at my house, whatever the case may be. And so then, like you were just talking about, right, this this adjustment, this estimate of of what the cost of the repair is to be, this is where it gets weird for me, is then decided by the guys that I've been paying, who I know clearly, as you just stated, is that their main primary objective is to pay out as little as possible. Right. So that right there, that's where I find that rub, that paradox is interesting. Like why is it not that the adjustment and the value of what the payout should be or the replacement cost or something, why is that not done by a third party, someone other than the insurance company who is best interest is to clearly pay out as little as possible, but yet they're the deciders of what it is. It seems like that ought to be done by a third party. I know you can get private adjusters to argue with them. That I know exists, but just fill me in on that a little bit. That's always something that I've always found annoying or whatever unfair maybe about the system. I guess I wouldn't say they want to pay out as little as possible. I mean, they obviously they want to, you know, maintain their profits, but they also want to keep, you know, builders honest in a way, too, because let's say you get a bid from one builder and that builder says, "Well, I want to charge $300 an hour in labor." and another builder says, "Hey, I want to charge 150 an hour in labor." So, they're just trying to make sure that in the future as well, they can have a parameter of what they're going to use to pay out to come up with premiums and adjust cost, right? So, I've had a lot of instances where people get way more money than they were ever expecting to get. You know, it just depends on the type of claim and the situation. But contract language in insurance companies is one of the most important things, right? Like a lot of times you might find a policy that's less expensive than another insurance carrier, but if you look at the language of what they do and don't cover is one of the most important things. Like mold for instance, a lot of insurance companies if you have mold won't cover it. Some companies will cover that. So you really want to look at your contract and what your contract says because that's what's going to determine your payouts and what they're going to do for you. Well, that's the risk, right? I mean, because they're taking the risk and so if they're going to cover mold, that would be a different risk level than not covering mold. Correct. What about this third party private adjuster? Do you see that? I mean, that's an industry, right? That you know people and what do those how do those people get paid? I've never really worked with one much. So, generally, if you hire a third party adjuster, the the insured is normally responsible for for the cost of that. They norally handle that. So, as a homeowner, you'd have to hire them and pay them. Correct. Right. Okay. I can say that in I think I've been doing this for 15 years now with All State in particular. Um very rarely did we ever come to that type of situation. Normally they you know they're able to resolve it. If you're able to um have a builder and who you have for your builder is really important because they have a system that they use to submit claims and if you have a builder who works with insurance companies, they know how to do that. And nine times out of 10, as long as you submit it properly, they'll approve um the bid up to the policy limits. Right. Okay. Okay. So, a lot of it is is is your builder knowing how to submit to insurance companies. They have their own language that they like to look at that inputs into their estimate. And if you know how to use that system, a lot of times there's never any issue at all. Okay. So, the builder then cuz we don't really work directly with insurance companies. We don't have that kind of relationship. We're like, you as a homeowner, you deal with your we'll help you. We'll give you ammo and whatnot. You deal with them. But maybe that's something we should do different. Well, it's actually very important because like let's say you hire somebody like my dad who's who's very old school did construction when he does a bid, you know, he would write it down on a piece of paper and hand it to you and say, "Here, you know, here's my bid, right?" Well, insurance companies want it detailed, like how many feet of sighting, you know, how much square feet, how much and if you and if you lay all that out and submit it into their their system, it's normally approved automatically. But if you hire somebody who's like, "Oh, I don't want to deal with insurance companies." It makes the process very hard because they won't submit the proper documentation that is needed. Insurance companies want detail. They want to know what they're paying for, right? So, they just want an essay. They want a good wordy essay that you like that feels like an A. Yeah. That way, that way if there's any discrepancy, the the adjuster, you know, if there's any discrepancies, has has a manager above them. And the adjuster takes it to his manager and says, "Hey, you know, we need an extra five or need an extra 10 grand and here's why. there's, you know, 100 linear feet versus the 25 we estimated and you, you know, here's the proper documentation showing that. Okay. So, let's let's dig on that. Something you mentioned there a minute ago I think is important is that what is that sort of like you talked about the language of the contract, right? Like mold is or isn't, but what are some of the things that you find and maybe not your clients or but the industry because I think you do a good job at least with me or I'm always bugging you calling like, "Hey, what about this? What about that?" you know, you're like, "Hello." But like what is the the thing or two that you sort of continually see that look of dread on someone's face when you tell them, you know, after the loss and it's too late, there's nothing they can do and you're like, oh no, that wasn't covered. Like what is that thing that like, oh, that wasn't covered. What is that big surprise thing? The worst thing, the thing that you see some regularity that you wish wasn't the case, but in fact in this instance or in multiple is the case. I would say water damage is the main thing cuz what what most people don't realize is a homeowner's insurance is called hazard insurance. And it's designed to cover sudden and instantaneous events, meaning like a tree falls on your house or a windstorm or a pipe freezes and bursts, that stuff's all covered. But let's say you have a copper pipe and it just gets a little tiny leak and it's been dripping for, you know, a year and finally you notice, hey, I have water damage, right? Stuff like that's not covered. And most people don't realize that it's not a hazard. It's not a hazard. Now, is that something cuz I do know enough I don't know a ton about insurance, but I do know enough about insurance that there's all these little rider or add-on things that you can get like, oh, give me the like for my car. like you you know you're always like you got to have the uninsured underinsured motorist rider, right? So like what are the is that something you can be a writer for a house? Um so no you you can't put that um that's more of a war like a warranty issue. That's the biggest confusion as a lot of people think that homeowners insurance is a warranty. It's not a warranty. It's designed for sudden sudden so that's that's that's a good thing. So it really So say that again. So sudden and what how does sudden and instantaneous events? Okay. like a tree falling, uh the roof blowing off, you know, huge windstorm, a hail damage, a fire, a catastrophic water leak blow over, you know, that that's happens. A pipe bursting kind of thing. Lightning volcano eruption stuff. All right. Now, flood that's different, right? Different. Yes. Okay. But that but that is a that's a how what is the deal? So, talk about that for a minute cuz is that a national thing? Like how does flood insurance work? Yeah. So uh most of flood insurance is regulated by the government. There there are priv some private companies that do it but 90% of the business written is written by the government and flood insurance is if it if it comes from the ground from the ground up that's considered a flood. So if it comes from your house out that's not a flood. Like a pipe bursting inside your home that's covered. But let's say your house is kind of you know a little bit of a valley and you have a a massive rainstorm and obviously the water's coming from the ground and if it goes into your house that's not covered. However, if the water's blown in through your window or blows the roof off from a storm, that's covered. But anything from the ground coming in is considered flood. So, you have to have separate insurance for that. Right. And that and the really the only place you get that is through the government, right? Is there FEMA is the main place where you get flood insurance. All state for example, like you guys do not do you do they even sell flood insurance? Oh, we write it through FEMA. Yeah, we we have a portal where we can log in. Okay. So, I can buy it from you, but really there it's coming from them kind of thing. You can conduit me to that. Exactly. Okay. And most insurance companies can do that. Like I don't have to call FEMA to get insurance. I can just call an agent. Right. Um well, a lot of Well, if the agent signs up for that program, you can. But a lot of agents don't want to do flood, so they just say, "I won't do flood." But everybody could have access to as an agent if they signed up for you. Okay. So, it wouldn't be hard to find flood insurance. Just know that that's definitely something is a separate not even really a rider anymore really. It's really a separate policy, right? It's not a right to a policy. Correct. Separate. Kind of like earthquake. Most uh most homeowners insurance policies don't include earthquake coverages. Okay. Talk about that. Like is that a big deal? I mean, around here, right? Yeah. There's a lot of fault lines especially through the Seattle area. So, um the thing with earthquake insurance though is it has a high deductible. So, if your home's a million dollars and you want a million dollars in coverage, um generally your deductible, the lowest is 10%. So you have to pay $100,000 out of your pocket before that earthquake insurance even kicks in. So it's going to need to be a pretty massive quake, you know, to exceed that amount. So a lot of times people don't want to, you know, pay for earthquake insurance because they don't have $100,000 or $50,000 out of pocket to pay the deductible in the first place. So they'll just avoid it altogether. Okay. So then if the if an earthquake be catastrophic catastrophic damage and you're not covered, but you walk away from the house. Well, hopefully the government will kick in and do help out something if it's catastrophic. But yeah, if you don't have earthquake uh insurance and it falls to the ground, um yeah, you're pretty much out of luck, unfortunately. I have it in my head at some point that that I think maybe you I asked a lot of my oddball insurance questions to you, but if like there was an earthquake, but your house caught on fire Uhhuh. is that is there some distinction there that you're covered on the fire, but you're not covered on the earthquake? Like what is there a fine line there? You Yeah. No. So fires if a fire happens sudden instantaneously that is covered, right? So but it happens because of the earthquake. Um it would still be covered. Yeah. Okay. Yeah. Yeah. Fire is covered. So if you don't have earthquake insurance and there is an earthquake Mhm. then you want to hope your house catches on fire. Yeah. Right. With during the earthquake so that you're covered because of the fire. Mhm. And even though you don't have the earthquake insurance, correct? Is that the is that the is that the hope if it goes bad? Yeah. Like let's say the house shook and you had a propane tank and for some reason causes the the propane tank to blow up and then catch the house on fire. The fires are covered peril sudden, instantaneous. So that would be covered. Yeah. Okay. Um but like if the earthquake caused a landslide to come down your house, that wouldn't be covered cuz you know you would need um landslide coverage to cover your home for that. And that's a separate policy that or a writer. No, that's a separate policy. That's another separate policy. A government thing also. Uh, no, that's that one's not a government thing. There's the All State and the big insurance companies, they all write that all kind they they write that themselves. Yeah, we have companies like um American Modern or Griffin underwriting service companies that will offer products like that. Okay. Yeah. And what does something like that cost? I mean, like, you know, houses are so over inflated in value here and, you know, we live in a pretty modest home and and we're paying $3,000 a year for, I think, or roughly that for our homeowners insurance, which I hope is a pretty comprehensive and got us on a number that, you know, if something were to go bad, but like what would like uh the earthquake, what would that add? Sure. So, it depends on um one, the size of your home, right? And the slope you're on. very flat. So, very modest 1,800 square f feet. Yeah. I mean, roughly $2,500 a year for earthquake insurance probably. So, yeah. And that depends on your deductible. If you if you put a higher deductible, say go up to 20%, it, you know, probably brings that down $500 $600 for the year. But, um, the main things that determine that is, you know, slope you're on and then the size of your home. If you're on the side of a hill, it's going to be a lot more expensive than if you're higher risk, yada yada. Okay. [Music] My first question was kind of the audit thing like what would what's a regular auditing schedule that someone should be on from a reviewing of their their replacement value you know some of that stuff like what's the like is that annual or is that a little more you know what two years what would you recommend ideally I would say annual um every two years is probably what's most common um but the main thing you want to look at is Like a lot of people don't realize the stuff inside their home as well. They're like there's there's limits and caps on what is and isn't covered. So let's say you have a lot of jewelry or you have a lot of firearms or guns, right? Most policies have limitations on how much they'll cover that cuz let's say you have your house catches on fire. You can't say, "Oh, I had $80,000, you know, under my mattress, so they're not going to give you 80 grand." So I want a photo of it. Right. Exactly. You know, so you want you want to schedule items like if you have, you know, a wedding ring that's $10,000 or guns to where if it is lost or, you know, uh in the fire, something happens for any reason, it's covered, right? Whereas if it's not scheduled, they give you only $1,500 of coverage for stuff like that. So, a lot of people have, you know, hundreds of thousand dollars of jewelry, they got firearms, ammo, all those things you'd want to schedule separately so if there is a loss or theft or something happens, all that stuff is covered. Yeah. I don't have a whole lot of stuff in that regard. We do have a couple of diamond things on ours for my wife, but not a ton. Uh the the expensive stuff that I have are are daughters, so they don't they don't get a writer policy. So that's personal content stuff. That's your your TVs and your furniture and your clothes and your art collection and your CDs, you know, whatever you have that your computers and guns and furs, you know, that high value stuff. And so there's a sort of like a an amount, right, that you have that just kind of covered. And then like what you're saying is the special things that are atypical are much more expensive like you listed guns and ammo and jewelry and a collection of some variety, right? I assume. Yeah. Let's say you had like rare coins or some really expensive silverware art. Um or like let's say you have, you know, $20,000 in golf clubs, right? You want to have stuff like that scheduled. Um, the main things that are included uh up to the limit, like let's say you have a million- dollar dwelling coverage. Typically, homeowners insurance will give you 60% of that in property coverage. So, $600,000, okay, to cover whatever's inside your home. And what's important about that is you also want to look at the contract language on that as well because there's a replacement cost one, right? And then there's an actual cash value one. So, you want the replacement cost one because you want to get reimbursed for 100% of the value of what what it was. So, like let's say you had a TV that was $1,000 and it's 3 years old. Now, what insurance companies do is they'll say, "Okay, the TV's 3 years old. We're going to give you $400 for it." That's the actual cash value at the time. That's But they're they're baking in the depreciation is in essence is what they're doing. Right. Correct. But to get to get whole, when you go buy the new TV and submit the receipt, they'll pay you the difference. So, they'll give you your 600 bucks back if it's a replacement cost policy. Right. But if you have in your contract language, it's only actual cash value. They're only going to give you the $300 or $400 that the TV's worth at the time, right? And I and I get my policy from you, right? It comes with renew that thing is a is a, you know, 30 pages kind of deal. And so you're telling me that I need to or people should like how do we do this practically, you know, give people some advice and what to watch for is that like I need to do I need to hire a lawyer to read my insurance contract, right? And if I did, if I had some language in there that say I did or I was very smart and understood that and then I went back to you and I with some edits to my All State contract. Hey, Michael, no, I don't like this clause. I don't like this phrase. Like, is All State going to negotiate their contract language with me? No, they won't negotiate the contract language. I mean, it's like when you when you're online and you and you download an app or something and you know, you accept our terms and conditions, it's either yes or no. They're they're not going to negotiate them with you. You're not like I don't want to, you know, do this. So then it's like people just don't even care. So you know, but this is a big deal. This is, you know, like how how does one know replacement cost versus cash value? That Well, it really comes down to your agent. That's when it's really important to have a good agent who's going to take the time to review that and go over those options with you. If you go online and you know, you build your own home policy and you just click okay, in essence, that's what you're doing. You have no idea. Most people have no idea what liability coverage is or what property damage or what additional structures are covered, but they're concerned about the price, right? So, they'll go online and find the cheapest price they can get and then they'll fall into a situation like that to where, oh, you know, I didn't know that that was all it was. So, that's a benefit having an agent. Whenever I write a policy, I go line by line and explain what the dwelling coverage does, what your additional structures coverage is. Um, and so they they know everything that isn't is in coverage and I ask them, hey, do you have firearms or do you have jewelry? Make sure that if they have those things, they know they need to be scheduled above the limits. Okay? So, you really need a good agent. And a lot of times, if there is a homeowner's insurance claim, um, that's where I get involved. And, you know, if there's an under allowance or there's an issue, I can call up and say, "Hey, here's the situation. and what can we do to help resolve it? And based on, you know, how you work with the adjusters and how long you've been doing it, you kind of know the ins and outs of how to submit something to get it approved. And that's what I help people do. Inflation code upgrades. Let's talk about that one for a minute, right? And I've experienced this one. And so I'll I'll give kind of a quick short version of this hopefully is that um in a few instances that we've worked on some projects in and we're doing a a like the one with the fire that I was talking about that we had to do it was a big big thing and then the code required that that house after renovation had a sprinkler system. Mhm. Yep. Right. And then as part of the sprinkler system being approved, that required ultimately that the water service to the house had to be upgraded to give more flow of water to the house to sufficiently feed the sprinkler system that was now required by code. Correct. And all of that though for this homeowner, luckily they had it that that was all covered because they had a code upgrade component to their policy. Yeah. Yeah, like with us, it's called building code coverage. Okay. So, you can add 10 or 20% on top of your dwelling structure. So, let's say your dwelling structure is a million and you have a 10% override for building code coverage. It'll give you an extra $100,000 to pay to upgrade, whether it's a sprinkler system or now they want triple pane windows or whatever improvements the county is requiring. It's designed to pay those upgrades. Okay. Now, what if the code upgrade requirements are more than the 100,000 in that instance? Yeah, it's only going to pay the 100,000. Yours doesn't matter. Now then that sounds to me so when you say that my brain's going off and that what I'm hearing there is that the older the house, okay, what's going on in my brain is that the older the house is, the more the code upgrade cost would be more than likely because that house was done, you know, say 30 or 40 years ago when codes were substantially different, though legal at the time, but nothing really has happened in say 45 years versus a house that was built 10 years ago that that's going to be a lot closer to code current code correct so then is there a mechanism by which that if I live in an old home I could choose to voluntarily pay and create a little bit more coverage in that regard for myself yeah there's there's ways you can do that um so if let's say you want more coverage generally all the coverages for for additional are off the dwelling structure. So if you wanted more than the 100,000, you could increase your dwelling structure say to, you know, 1.2 and get an extra $20,000 of of coverage that way. Okay? Relatively inexpensive. The other thing though that you can do um is let's say um you have a million dollars in coverage, right? But the reconstruction cost on the home is only 750,000 for whatever reason, but you have um $180,000 in building code coverage. In that instance, since it's le less than the total policy amount, it will still cover the building code coverage. Okay? Does that make sense? Because it's less than the million. Yeah. So, insurance companies will help you, you know, cover that cost if it's within the policy limits. They just won't pay out more than the policy limit. [Music] A homeowner is thinking about remodeling or renovating, right? What differences should they do? They need to call their agent. Hey, my house is going to be under construction. I'm doing a big remodel. What should they do? And then also, what happens if they move out? Cuz sometimes people live there during the construction and sometimes they move out because it's so extensive. Does that change whether because I believe that a vacant property or a non-vacant? Like there's different risk there. So, does that make it different if they're in or out? First thing you want to do is make sure that whoever you're hiring has the proper liability insurance to be working on your home. the same coverages you have still apply to that home. So, if something happens while they're in there working on the home, fire, theft, whatever, it's still covered. You just want to call your agent to make sure you say, "Hey, I'm going to I'm going to upgrade my home. Here's going to be the improvements. It's going to increase the value of my home, say $150,000 or whatever it is. Have your agent update it at that time so that that coverage is in place." Um, and as long as you have somebody coming in of the house every day, it's not considered vacant. So if you have somebody working on it, that means they're checking every day. So you don't have to change any of the coverage. That doesn't change anything. Yeah. Make sure your builder has the right coverage in case they're at fault for something to cover their their end. And you're What would you say is the right coverage from a the builder standpoint? Well, you want to make sure they have enough liability coverage to where what is what is that number to you? What's comfortable number? Whatever the value of your home is. Say if you have a $2 million home, you'd want to make sure they have at least a $2 million policy to replace, you know, something happens because if they go there and they're at fault for, you know, destroying your home, let's say they catch the home on fire, then their liability insurance should pay for that. Your insurance shouldn't have to. Right. Now, let me ask you about this one. We had an incident. Uh, it's been a few years ago over in Seattle. We were building a project and there was a break-in during construction. Yep. and they stole things from the house. They the thieves um stole like uh I don't know 20 or 30 boxes of hardwood flooring that had just been delivered and were sitting there and we hadn't installed them. They were still in the boxes. They literally just got there. They stole all the hardwood floor. They stole some windows that hadn't been installed. They stole a new refrigerator that hadn't yet been installed. all things like that. So, and and there was a there was some some real consternation around that in terms of who's really responsible for that stuff. Are we as the builder responsible for that or is the homeowner because that's your refrigerator and that's your flooring, you know, kind of thing. So, when does that where does that liability because at some point it's mine and then at some point it becomes theirs, but when does it become theirs and how does that work? generally when it's installed, when it's a permanent I mean a refrigerator is different, but the flooring and the windows and stuff once it's installed and it's a permanent fixture. But that's why it's important to to make sure when you hire a builder, not only do they have liability coverage, but they're going to have to have property coverage as well to where if things are stolen or equipment is stolen, those things are covered. It's really important that way you don't have that who's paying portion of of the policy. In that case, you know, I would assume since it was the builder stuff they just paid for and wasn't installed that, you know, probably their insurance would be responsible for that, right? But sometimes it can take months for them to go back and forth and resolve it. That's for sure. [Music] If you like your agent, who you have, work with your agent to help you work through, you know, the main thing in the industry right now is price increases. Everything is getting more and more expensive every day. So, I would say really take the time to review your policy, make sure you have the property coverage, proper coverages. Um, and if you do shop because prices are increasing, make sure if you're going to switch that you have the the proper contract language in place to make sure your home is covered properly. I've seen time and time again where, you know, people have got a cheaper policy and I said, "Hey, you know, the contract language is different. You don't want to do that and then they go and they have an issue, you know, and I have them back a year or two later because they don't like the experience." So, really, you know, watch the price increases. Make sure your insurance company's staying honest with that, but take the time to review it with your agent as well to make sure it's actually covering what what you have. I I don't think I can let you get away today without asking you to give me just a real quick minute thought on the whole D AU ADU world. And if I have one of those or I want to build one of those, if I'm renting it out, just give me a a a moment about that. like what would you say to people to know or ask or think about or find out? Yeah. No, really important and that's where contract language is going to come into play. Um you want to make sure on your policy that it has a liability extension that will cover the other people on your property, right? So now you're increasing risk because you have more people on your property not related to you. So, you want to make sure that your homeowners insurance policy not only covers the cost of the ADU in case something happens, but also extends liability coverage to in case, I don't know, let's say they have a dog and their dog comes out and bites somebody. You want to make sure that you're covered for that slip and fall, slip and fall, any of that stuff. Cuz one of the biggest things that happens is, you know, you have dog bites or slip and fall or somebody comes onto your property and, you know, they get hurt and they want to sue you. So, if they're inviting other people on the property that, you know, you don't know, you want to make sure that that is covered, right? and we have an umbrella policy that you put me in. So like that would be a part of like that toolkit to prepare yourself and right for self defense against that kind of thing and that would be a way to do that or a piece of that. Yeah. So, with the endorsement on your home policy for the ADU and the umbrella coverage, if something happened and the liability, like let's say they sued you for $500,000, your home owners policy is at $300,000, then your umbrella policy kicks in, pays all the attorney fees and the additional $200,000 for you. And that's pretty affordable. I don't think that I think you I mean like a million dollar or something just that extra. And I don't think that is massively expensive. No, umbrella policies are are really important. Like right now in our state, lawsuits are going absolutely crazy. So, it's one of the least expensive ways to ensure yourself against a loss. So, you know, a million dollar policy is like $300, $400 for the year, depending on, you know, how many cars and drivers you have, and it's the least expensive way to insure yourself for a million dollars for sure. It was a lot more than three or 400, though. But I do have like 15, all the kids and stuff like that. So, I think we're going to have to pull the plug, sir. I really, really appreciate you coming in. This was a pleasure. I learned a lot. Let's Build with Armada podcast right here from our offices in Belleview and our beautiful showroom. Come on in and uh talk to us about your project. Find out if you're underinsured, what the value, right? What the value of your replacement cost is. Bring us something about your house and we could tell you how underinsured you are because more than likely you are. Like we like your rebuild cost would be this much and you can find out. So call us about that. All right. Thank you.