Renovations That Can Impact Your Home Insurance

Home Renovations can be an excellent way to enhance the value of your home. However, you can get so occupied with daily life and renovations that you may completely forget to inform your insurance company. It is worthwhile to remember that some home renovations can dramatically enhance the value of your business as well as the cost of your home insurance.

Renovating your roof: Decrease

A new roof may not appear the most exciting home improvement but it surely can enhance a lot of cash and other resources when it comes to homeowners’ insurance. Some homeowners may also be entitled to get bigger discounts if they live in wind, hail, or hurricane-prone states.

While a majority of home policies cover roofs, most insurance companies make use of depreciation schedules based on the roof’s age to find out how much protection can be received. However, some policies may not cover the roof based on its age. The newer the roof, the more the insurer will spend to replace it. You can add flood insurance if your home is in a flood-prone area as the flood insurance can cover the cost of leaks or damage to your roof.

Building a pool: Increase

A swimming pool may transform the complete appearance and value of your home, but it also means that your home is prone from an insurance standpoint. Usually, standard insurance policies come with $100,000 in personal liability protection that would cover medical costs for an individual injured in the swimming pool and any legal expenses if you get sued. However, insurers may recommend that pool owners should opt for a minimum of $500,000 in liability coverage. Insurers may recommend a fence around the swimming pool with a lock and may ask for a higher premium, especially if the pool has a diving board or slide.

Adding an office for a home business: Increase

Let us assume that you plan to sell reclaimed wood furniture at home. Will your home insurance cover the assets of your business? It is generally seen that a majority of homeowner policies safeguard equipment for home-based companies for up to $2,500 that may not be sufficient for business owners who store large supplies, inventory, or specialized machinery. In such cases, you may not upgrade your existing policy or purchase an additional business policy.

If your business doesn’t bring a lot of visitors to the home and needs only some basic supplies outside of a desktop, your existing policy may be sufficient. However, if you provide private yoga or piano lessons and your home witnesses heavier foot traffic, you should upgrade your existing policy or buy an additional business policy. Alternatively, you can opt for in-home business insurance that costs approximately $300-$400 a year while providing the same protection features that you can avail of as a larger company with smaller policy limits and premiums.

Upgrading your kitchen or bath: Both

It may come as a surprise to you but sometimes nothing gives your home the facelift that it requires than transforming your master bathroom into a spa sanctuary or your kitchen into a chef’s ultimate dream. However, you should also make sure that the home insurance also receives a makeover else the renovation may be at risk.

For instance, let us assume that your insurer has based your coverage on a kitchen with generic cabinets and laminate countertops. However, you later decide to spend an additional $30,000 on custom cabinets, granite countertops, and state-of-the-art appliances. Would your existing insurance coverage be enough to take care of your remodeled kitchen after a natural calamity? Not if you don’t update your policy. Therefore, you should give a call to your insurance company and notify them of the renovation while offering proof and photographs to validate your claims. Of course, your insurance premium will go up a bit but it will also protect your home’s physical assets.

Expanding your space: Increase

If you are planning to expand your family, you may need to grow your home. This may means the addition of more livable square footage. To accommodate your growing living requirements, you may have to buy a new policy to your existing policy or buy a new policy. It is recommended that you have a close look at different available insurance options.

Do I Need to Notify My Insurance Company For All Renovation Projects?

A good rule of thumb is to notify your insurance company immediately, especially if the renovation project is likely to increase the cost to rebuild the home in case of a mishappening. On the other hand, if you have just made a minor change such as repainting the walls or the removal of 1970s-style wood paneling in the family room, you usually don’t have to notify your insurance company though it never hurts to make a communication in writing. After all, the last thing you want is to be under-insured for worst-case scenario.

About the Author

Harvey Lee is a home improvement blogger based in Peterborough, UK. He is passionate about home improvement and loves to blog about home improvement. He love to share knowledge and experience with people. He collaborating with industry like to get insight on the latest trends.