Home renovations are an exciting venture for homeowners. But along with the thrill of seeing your home transform, there comes the responsibility of ensuring its protection. A common question many homeowners ask is, “Do I need home insurance for renovations?”
Yes, you do. In this blog, we’ll explain the nuances of home insurance and home renovations!
Why Is Home Insurance Important During Renovations?
Embarking on a home renovation journey can be both exhilarating and challenging. The vision of a rejuvenated space, tailor-made to your tastes, is indeed enticing. However, like all big projects, it comes with its fair share of risks. This is where the importance of home insurance during renovations truly shines.
Imagine meticulously planning every aspect of your renovation – from choosing the right tiles for your bathroom to selecting the perfect shade of blue for your bedroom. Now, imagine a sudden water leak causing havoc to your newly installed hardwood floors. Or, envision a scenario where an accidental fire chars your freshly painted walls. Such incidents, though rare, are not impossible. And without the right home insurance during renovations, the financial implications of such damages can be significant.
But it’s not just about potential damages to the property itself. There are other complexities to consider:
- Delayed Projects: Unforeseen damages can lead to unexpected delays. Every day that your renovation project is halted, you could be incurring costs – be it in the form of additional rent for temporary accommodation or lost wages if you’ve taken time off work to oversee the project.
- Increased Liability: Renovations often mean having contractors, laborers, and other professionals on your property. What if someone gets injured? While they might have their insurance, having comprehensive coverage ensures you’re not held financially responsible.
- Protection of New Assets: As renovations proceed, you might bring in new fixtures, fittings, or even technology. These assets need protection too, and a specialized renovation insurance can ensure they’re covered right from the get-go.
- Preserving Home Value: Proper insurance ensures that if damages do occur, they can be addressed and rectified promptly, preserving the value of your home. This is especially important if you plan to sell or refinance in the future.
In essence, home insurance acts as a safety net. It’s the cushion that softens any potential financial blows that unforeseen damage that might happen to your home. It provides homeowners the assurance that their investment remains protected, every step of the way.
How To Insure A Home Under Renovation?
While some might think their current homeowner’s insurance covers renovations, it’s essential to double-check. Reach out to your insurance agent to discuss your renovation plans. They’ll guide you on whether your current home insurance covers it or if you need specialized renovation home insurance.
JVM Lending always recommends that homeowners inform their insurance company about renovations to ensure they get the most comprehensive coverage. It could be as simple as updating your dwelling coverage or as detailed as getting contractor insurance.
How Does Home Renovation Impact Insurance Costs?
Home insurance costs can vary. If you’re expanding your square footage or adding high-end amenities like a swimming pool, your home insurance for the renovations might increase. This is because you’re increasing your home’s value, and your coverage limit needs to reflect that.
Conversely, some renovations, like installing a modern security system or updating your roof, might even decrease your insurance costs since they reduce risks.
Does Homeowners Insurance Cover Home Renovation Damages?
Yes and no. Standard homeowner’s insurance covers damages to personal belongings and the structure of your home, but it doesn’t always cover damages caused during renovations. This is where home renovation insurance becomes invaluable.
For instance, if your contractor accidentally damages a wall, your regular homeowners insurance might not cover it. But specific renovation insurance will. Always discuss with your insurance agent to understand what your homeowner’s insurance coverages include and what additional protection you might need.
I’m Just Doing Minor Home Renovations; Do I Still Need To Notify My Insurance Company?
Absolutely, yes! Even what might seem like “minor” renovations can significantly impact your home’s value. For instance, let’s say you’re expanding a room. While it may appear as a small project, this increases your home’s square footage, possibly pushing your current insurance coverage limit. Similarly, redoing your kitchen with modern fittings or adding a new bathroom not only enhances the comfort and functionality of your home but also its overall market value.
Beyond the value, certain renovations can also pose temporary risks. For example, redoing your electrical setup could increase the chances of fires, while a revamped flooring might be a slip hazard until it’s fully settled. Your insurance agent can provide insights on how such changes could affect your homeowners insurance covers. So, it’s not just about the end value; it’s about the journey too. JVM Lending recommends always keeping the lines of communication open with your insurance company, no matter how minor the renovation seems.
Is Flood Insurance Necessary During Home Renovations?
Flood insurance becomes particularly pertinent if your renovations involve foundational or structural changes, especially in flood-prone areas. Maybe you’re adding a basement, which could increase the risk of water damage in case of flooding. Or perhaps you’re landscaping your yard, which can change the flow of runoff water.
While your regular home insurance might cover water damages from issues within the home, like burst pipes, flood damages from external sources often require separate coverage. Consult with your insurance agent, and they can assess your property, the nature of your renovations, and guide you on whether flood insurance is a smart choice for you. Remember, it’s always better to be safe than sorry.
Increasing Home Insurance After Renovation
Upon completing your renovation projects, it’s time to revisit your insurance coverage. Chances are, you’ve increased your home’s value. Whether it’s due to the added square footage or the inclusion of new amenities, your home insurance should reflect these changes. This way, in the unfortunate event of a mishap, your insurance covers the increased value of your home, ensuring you’re not left out of pocket.
Questions About Home Insurance? Contact JVM Lending!
Home renovations are thrilling. They breathe new life into your space, adding value and comfort. But with great renovations come greater responsibilities. That’s where JVM Lending steps in. As experts in the field, we understand the ins and outs of home insurance during renovations. From knowing when to increase home insurance after renovations to understanding the intricacies of hazard insurance for homes, we’ve got your back.
Remember, your home is likely one of your most significant investments. Protecting it, especially during transformative periods like renovations, should be a top priority. Ensure you’re adequately covered, and embark on your renovation journey with peace of mind!
Questions about funding your home’s renovation or securing homeowner’s insurance? Contact JVM Lending for more info on funding a renovation and how renovations can impact your home insurance.