Home renovations can significantly enhance your living space and increase your property’s value. However, it’s crucial to understand how these changes might impact your home insurance coverage.  

Understanding Renovations and Home Insurance

The following are some renovations that could affect your policy:

• Adding a swimming pool—While it can boost your home’s appeal, a swimming pool also introduces additional risks. Pools are considered “attractive nuisances,” increasing your liability exposure. Your insurer may require higher liability coverage or an umbrella policy to cover potential accidents.

• Building an extension—Expanding your home by adding a new room or floor can significantly increase its value. This change may necessitate updating your insurance policy to reflect the new value of your property. Failing to do so could leave you underinsured in the event of a claim.

• Upgrading the roof—Replacing an old roof with more expensive materials, such as slate or metal, can enhance your home’s structural integrity and appearance. However, this upgrade may increase your home’s replacement cost, leading to higher premiums.

• Renovating the kitchen or bathroom—Extensive upgrades in frequently used areas, such as kitchens and bathrooms, can significantly enhance your home’s value. Installing high-end appliances or luxurious fixtures means you should update your insurance policy to cover the increased cost of rebuilding or repairing your home after a loss.

• Finishing the basement—Converting an unfinished basement into a livable space adds value and increases the risk of water damage. Discuss this change with your insurance agent, as it may require additional coverage for potential water damage.

• Adding a home office—With more people working from home, converting a room into an office has become popular. Operating a business from your home office can impact your homeowners policy. You may require extra business liability coverage to help financially safeguard against risks linked to running a business from home.

• Installing security systems—Adding security features like alarms and surveillance cameras can lower your risk of theft and vandalism. Inform your insurer of security upgrades for potential discounts.

Learn More

To discuss homeowners insurance near you, contact Churchill Insurance, Inc.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.