In a years-long renovation, are you insured against a neighbor's lawsuit?

By Virginia K. Smith | September 26, 2014 - 12:59PM

We've always known that loud, ongoing renovations have a way of making enemies of the folks next door, but this case from the Upper East Side is particularly extreme: former publishing exec Richard Snyder is suing his neighbors to the tune of $20 million thanks to a never-ending renovation he says has caused "excess vibrations," damaged his shrubs and rear deck, forced him to move personal property, and rendered his house un-sellable, according to the New York Daily News. Oof.

Snyder's neighbors, Bryan and Meredith Verona, bought the building at 122 East 78th Street in 2010 for $17.25 million, Curbed reports, after a developer had cleared it of its tenants. It's now under renovations to be turned into a "lavish single-family home," as the Daily News puts it, and has been for the past three years.

This story raises plenty of questions about the etiquette of renovations (and the ethics of turning a series of apartments into a home for a single ultra-rich family), but it also got us to wondering: what does happen if your neighbors get fed up with your renovations and sue? Or if your neighbors' reno ends up damaging your property?

Turns out, there's a good chance the damage will be covered by the insurance of the person doing the home project, apartment insurance broker Jeff Schneider of Gotham Brokerage tells us. First and foremost, if you're renovating, make sure your general contractor names you under their General Liability policy, Schneider explains. "Your written contract with the GC must specify that you will be named as an additional insured." That way, if there's a suit alleging damage, you'll automatically be covered, he says.

There's also a good chance the renovator's personal policy will provide this type of liability coverage, though it may hinge on whether you've stayed in the home during the construction (unlikely in this particular case), or previously notified your broker that you won't be in residence during the reno.

And if you find yourself in Snyder's position, with damage to your home (and an everyday series of irritations)? "Not all perils are covered," says Schneider, so if you'd rather not take your neighbors to court, check the particulars of your policy first. Good fences might make good neighbors, but failing that, so do good insurance policies.

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