Did you know that making improvements to your property can affect your home insurance? Whether the alterations you are making on your home are cosmetic or practical, you should be prepared to look over what insurance policy you have and how any new renovations like a brown leather couch will impact the terms and conditions.
While certain property upgrades can serve to reduce the amount you’re paying in home improvements, there are some renovations which might actually increase your rate or not be covered at all under your current policy. Also, you have to consider what risks your home will be exposed to while building works take place and whether or not your current home insurance policy covers that.
Failure to notify your provider about any new improvements could result in your home being underinsured if the worst should happen, or even lead to your policy being made void. It is therefore essential that you discuss any home improvements with your insurance provider so that they can re-evaluate your needs and make sure that you have adequate cover for your planned renovations. So, how exactly does home improvement impact your home insurance?
Security
Larger-scale building works might require that your home is empty for a period of time and so you might have to move out while the work is completed. Home insurance policies differ as to how long you’re covered during times when your property is unoccupied. Building materials left out around a property are at risk of being stolen or damaged, but the contents of your home could also be under threat during renovations. Depending on what type of improvements you’re planning on carrying out on your property, there could be a chance that the security of your home could be at risk.
Renovations, such as extensions, might include the removal of doors and windows, thereby potentially allowing access to opportunist thieves, vandals, or wild animals. Whilst most home insurance will cover up to 30 days of leaving a building unoccupied, it’s important that you speak with your provider just to make sure. It might be that you need to take out additional cover during any building works to make sure your empty property is protected should it be damaged.
Lower rates
Before beginning renovation, it’s worth checking the particulars of your homeowners insurance because there’s a chance that works could actually lower the amount you pay. Home improvements that strengthen the building’s safety or security, such as upgraded plumbing or electrical systems, could help to lower the rate of your insurance. For instance, old wiring systems, that are no longer compliant with current building regulations, will have a negative effect on your home insurance – you might be paying substantially more than you want, or you might have trouble even finding a provider willing to cover you in the first place.
Massive renovation projects which involve rewiring the building will reduce the risk of electrical fires and thereby help lower your home insurance. Likewise, replacing old plumbing systems can have a similar impact. Owners of older properties that contain traditional lead piping might find it difficult and expensive to get insurance to cover it. Therefore, upgrading your system to one that’s more modern will not only be safer but will lower the chances of water damage and should decrease your home insurance.
Replacement of roofing materials is also a project that could lower your home insurance rates, again due to the added security and protection such works will bring. Renovations such as roof upgrades or new cladding can help protect against the elements and reduce the risk of flooding, dampness, or water damage, all of which could save you pennies on your home insurance, especially if you live in an area that’s prone to extreme weather conditions.
Increased rates
While upgrading your property can certainly reduce your home insurance, there are renovations which might result in you having to pay a bit more. It’s therefore vital that you address this with your provider to make sure you’re not underinsured. The pandemic has seen more and more people working from home and therefore more homeowners transforming a room into their own office space. Even if you’re not extending your property to accommodate a workspace, simply converting a room into an office could impact your home insurance. You might need to add additional cover, for instance a policy to protect work equipment or a separate business policy. Your current home insurance might not cover business property or any liability related to your work, therefore you should always address this with your provider.
Potential damage
All home improvements, whether they’re repairs, general maintenance, or merely cosmetic features will carry the risk of potential damage to your own property or that belonging to neighbours. Renovation works can often involve tearing up flooring or ripping out walls or structures; all of which can lead to pipes and utility lines becoming exposed. This, in turn, will make them more vulnerable to water or gas leaks. Likewise, the removal of external structures, such as windows, walls, roofing, and doors, will make your home more vulnerable to water or weather damage. While it’s important that you make sure your contractor has adequate procedures in place to protect your property from the elements, it’s equally vital that you inform your insurance provider.
Also, it’s worth remembering that uninhabited buildings are at more risk of fire, which is something to consider if your property will be uninhabited for the duration of your renovation project. Check with your home insurance provider that it covers you for the length of time your property will be unoccupied. If your improvement works are in danger of damaging any neighbouring properties, you need to make your home insurance provider aware. Projects such as extensions are likely to be undertaken in areas where there are boundary walls, therefore there is always a risk of damage to any surrounding property. This is something also to discuss with your home insurance provider.
Conclusion
Certain upgrades to any property, especially those which result in better safety or security of the structure, might lower the rate you’re paying on your home insurance. Any kind of building work carries the risk of property damage, theft, vandalism, flooding and more, therefore it’s vital that you inform your home insurance provider of any renovations you plan to carry out. While you might have to be prepared to take out additional cover for the duration of any home improvements, this will be of benefit to you long-term. Not only could you be paying significantly less on your home insurance, but the value of your property could increase. It’s vital that your property is not underinsured.
