There are many comments, articles, and stories about the temporary Home Renovation Tax Credit (HRTC). The basic explanation is that the federal budget offers a 15 percent non-refundable tax credit for certain renovations costs incurred between January 27th 2009 and February 1, 2010.

So, if there are so many comments, articles, and stories about it and I am not an accountant or tax expert... why am I writing about it?

The reason is because there are insurance implications.

Insurance to Value (ITV) is a "hot button" topic in the industry these days. Many people are underinsured. This happens due to a few reasons. One is because "inflation increases" that are put through annually on insurance policies may not keep up with actual increase in costs. It is a really tough thing to keep on top of, and results in many people being under-insured if they have a loss that results in the complete destruction of their home. I recently helped out a friend of mine who was insured with one of our competitors. When we wrote his insurance for him, we properly insured his house at a value of about $100,000 more than he was previously insured at! Another reason is that many clients don't think to advise their insurance broker when they do renovations. If your broker doesn't know about it, he can't insure it.

Back to the HRTC ... if you are taking advantage of this incentive, give us a call and let us know so that we can make sure that your home is properly protected for the true replacement cost of your home. This will result in the proper protection being there when you need it most.