Renovations and Home Insurance: What You Should Know Before You Build

Embarking on a home renovation project can be an exciting venture, but it’s crucial to understand how these changes might affect your home insurance. Ensuring that your property is adequately covered during and after the renovations is essential to protecting your investment. This article will guide you through the key considerations regarding renovations and home insurance.

Why Home Insurance Matters During Renovations

Renovations can significantly alter the value and structure of your home. Consequently, your existing home insurance policy may not provide sufficient coverage for these changes. It's vital to review and update your policy to reflect the new value and to cover any additional risks that may arise during the construction process.

Types of Renovations That Impact Insurance

Not all renovations will affect your home insurance policy in the same way. Here are some common types of renovations and their potential impact on your insurance:

  • Structural Changes: Adding a new room, removing walls, or modifying the roof can change the overall structure and value of your home.
  • Upgrades to Systems: Installing new electrical wiring, plumbing, or HVAC systems can affect your coverage needs due to potential new risks.
  • Luxury Additions: Adding features such as a swimming pool, hot tub, or expensive fixtures can increase the value of your home and the liability risks.

Steps to Take Before Starting Your Renovation

Before you begin any renovation project, it’s important to take the following steps to ensure your home insurance policy provides adequate protection:

1. Notify Your Insurance Provider

Inform your insurance company about your planned renovations. This allows them to adjust your coverage as needed and ensure that you are protected throughout the construction process.

2. Review and Update Your Policy

Work with your insurance provider to review your current policy and make any necessary updates. This might include increasing your coverage limits or adding specific endorsements to cover new additions or risks.

3. Consider Builder’s Risk Insurance

If your renovation project is extensive, you might need to purchase builder’s risk insurance. This type of policy covers damage to your home and construction materials while the renovation is ongoing.

4. Hire Licensed and Insured Contractors

Always hire licensed and insured contractors for your renovation work. This ensures that any damage caused by the contractor’s work will be covered by their insurance, reducing your risk.

Post-Renovation Considerations

Once your renovation is complete, it’s important to reassess your home insurance policy to ensure it aligns with the new value and condition of your home.

1. Update Your Home Inventory

After renovations, update your home inventory to reflect new additions and improvements. This helps in accurately valuing your home and contents for insurance purposes.

2. Reassess Coverage Limits

Check if your current coverage limits are adequate to protect the increased value of your home post-renovation. You may need to increase your dwelling coverage to account for the higher replacement cost.

3. Verify Liability Coverage

If your renovations included adding potentially hazardous features like a pool or trampoline, make sure your liability coverage is sufficient to protect against potential accidents or injuries.


Renovating your home is a significant investment, and ensuring proper insurance coverage is a critical step in protecting that investment. By understanding the impact of renovations on your home insurance, taking the necessary steps before and after your project, and working closely with your insurance provider, you can enjoy your newly improved home with peace of mind.