Homeowners invest in home renovations and remodeling projects for many reasons. Some want to create more space or increase the selling value, while others seek to align their home’s style with their evolving design preferences. No matter what triggers a bathroom remodel, master suite addition, or new front door, consideration should be given to how these updates impact your homeowners insurance coverage.
At Doeren Mayhew Insurance Group, our dedicated group of trusted advisors assists our clients to ensure they have adequate protection in the face of unexpected risks. Backed by more than 130 years of agency experience, we understand the complexities of ensuring homeowners insurance policies adequately protect your assets.
What is Homeowners Insurance?
Homeowners insurance is a type of insurance policy that covers physical loss, liability, and personal property as it relates to your home. There are many elements to consider in purchasing the right policy, including deductibles, coverage limits, and risk profiles. In order to obtain a sufficient level of protection, it’s important to work with a trusted insurance advisor to review your unique needs.
That said, if you are planning to undertake a new home renovation project, it’s critical to understand its impact on your coverage.
Talk to Your Insurance Agent
Before adding that sunroom or finishing your basement, be sure to communicate your plans with your insurance agent. Together, you should review your current policy’s limits to ensure that any necessary coverage adjustments are made. Additionally, it’s important to verify that any contractors hired to work on your home are licensed and carry the necessary insurance coverage. Keep in mind, some home projects may also warrant a supplemental policy or endorsement to protect your assets while your home is under construction.
Discussing the details with your insurance agent will ensure you are fully protected during the renovation and after its completion. If you’re considering a new project or already have one underway, schedule a consultation with one of our insurance advisors to discuss your needs.
Types of Home Renovation Projects
Because there are different components of a standard homeowners insurance policy, the impact of home improvements can vary.
Finishing a Basement
Upgrading your unfinished basement with new carpet, framing, drywall, and insulation goes a long way toward creating a more functional, comfortable living space. However, this new usable space adds value to your home and therefore will warrant an increase in your policy’s dwelling coverage limit in order to provide adequate coverage. Additionally, you will want to review your policy’s sewer and water backup coverage to accommodate the increased value.
Building a Pool
While building a custom in-ground pool in the backyard offers exciting entertaining options, it also increases your liability risk significantly. This will likely impact the cost of your homeowners insurance premiums. The cost of installing the pool may also rise because your insurance carrier will also likely mandate a lockable fence, safety cover, and other protections to ensure optimal safety in and around the pool.
Increasing Square Footage
Investing in a new addition — whether you’re adding a guest room, sunroom, or finished garage — expands the livable space within your home. These upgrades and added square footage will likely require a higher homeowners insurance dwelling limit to accommodate the increased value.
Install Security Measures
You may also qualify for lower insurance premiums if you’re installing a centrally monitored alarm system, video surveillance system, or automatic water shutoff device. Discuss these security measures with your advisor to see what premium discounts may be available to you.
Renovating a Kitchen
Don’t get caught up in the excitement that comes with undertaking a brand-new kitchen renovation and neglect to talk to your agent. Because these types of projects often increase the value of your home — impacting the amount of money that would be required to rebuild it — additional coverage may be necessary to cover gaps and exclusions in your existing policy.
Replacing a Roof
You can actually save money on your homeowners insurance policy when replacing a roof with energy-efficient, durable materials. The newer and stronger a roof is, the better equipped it is to withstand covered perils. That means you may lock in lower premiums and significant discounts when upgrading to a new roof.
We’re Here to Help
While there are many different types of home renovations and remodeling projects, they each come with an important impact on your homeowners insurance coverage. At Doeren Mayhew Insurance Group, our insurance advisors will ensure you have proper coverage ahead of investing in home improvements.
Whether you are looking to build your dream kitchen or install a new roof, our reliable insurance agents will discuss your options and help you secure the appropriate homeowners insurance coverage. Contact us to schedule a personalized consultation.