What Are Some Home Renovations That Can Alter Your Home Insurance?
A home renovation can improve the home’s value while providing more functional living space for your family, but did you know it could affect your homeowner’s insurance policy? Anything that changes the structure of your home or its use could affect your coverage. Here are some common examples of projects that might alter your homeowner’s insurance policy:
A New Roof
Here’s the good news: certain renovations can mean good news for your policy. A new roof might not be on your wish list, but it can save you a lot of money on your home insurance premiums. According to Allstate, this improvement could rack up 10-20% in monthly savings, making it one of the biggest factors that affect your homeowner’s insurance policy. There is a simple reason for this: water damage from snow, ice, and rain make up the largest portion of home insurance claims.
To make the most of your investment, check with your insurer to see if they offer additional discounts for premium materials, and ensure your contractor adheres to municipal codes to the letter.
You’ve always wanted an in-ground pool, and now you have the budget to do it. Before you break ground and pump up the inflatables, consider how it will affect your coverage.
In the insurance industry, a pool is what’s known as an “attractive nuisance.” It might make you one of the most popular homes on the block, but it also exposes your home to liability. Depending on your insurer, you’ll not only have to increase your policy to compensate for your home’s increase in value, but you’ll also have to purchase up to an additional $500,000 in personal liability coverage. When it comes to home additions, remember: the fun stuff will usually cost you more.
An Additional Room
As your family expands, you might consider adding on living space to accommodate its new members. For some people, this means adding livable space in places that were previously uninhabitable, such as a basement or attic. In other instances, families prefer to physically add space. A good rule of thumb is that any addition will add an extra $100 per square foot of value to your home. This will be reflected in your policy, so expect to pay higher premiums.
It’s important to let your insurer know about these additions before you start them. For example, if you started a project and a fire destroyed it halfway through, you’ll want to be able to recoup those losses. Equally essential is choosing the right coverage for your new addition – for example, your basement addition might require additional water damage coverage.
Home additions are often essential for creating more functional living space or simply to modernize your home. However, it’s important to consider how each of these projects will affect your homeowner’s insurance policy. When it comes to talking to your insurer, honesty is the best policy – withholding information could result in forfeiture of your coverage. Talk to your insurance company for further details