DIY : How Home Renovations Affect Insurance Policies – Insurance Navy – Medium

Whether you are updating a half bathroom or renovating an entire property, changes to a house can change the homeowners insurance premium. Some updates may lower your homeowners insurance costs and others that increase a property’s value will also cause a premium to increase.

A special report by Consumer Reports and ABC7 reporter Michael Finney found that a new roof typically means saving on a policy. New roofs, especially those made out of fortified materials will lessen the chance of rot and structural damages which are more expensive to correct and create even more problems.

Upgrading heating, plumbing and electrical systems is also likely to reduce costs. With safer practices, properties will be less prone to fires or floods, both of which are covered in a standard homeowners policy. According to the U.S. Fire Administration, electrical fires account for 6.5 percent of residential fires in 2016.

Installing generators may also help reduce premiums. Generators keep systems powered by electricity running even during power outages. This is especially important for sump pumps that can flood a house that is out of power for too long.

However, there are home improvement projects that will increase the costs of homeowners insurance polices. Any renovation that increases the property’s value is also likely to also increase the insurance premium.

For example, adding in in-ground pool generally means more people in and out of the house. This also increases the chances of people getting hurt on the property or accidentally drowning. Both of these scenarios are covered under homeowners insurance which means the home is a bigger risk for insurance providers.

An addition of more than 1,000 feet is also likely to increase the property’s value along with the quality of materials used for any changes. For example, if you are replacing the flooring at a house with real wood, the property value will more than likely be higher than if you were to use laminate.

Renovations do not have to be laborious ordeals. Simply updating the appliances in a home can increase the property’s value.

Remember to ensure contractors have proof of general liability insurance. This decreases the chances of being involved in a lawsuit for a construction-related injury on a property. Remember to keep your insurance company involved during the home improvement process and shop around at least one every three years to take advantage of new, special offers.


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