How to Manage Insurance Coverage Before and After a Home Remodel

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Insurance coverage before and after a home remodel

Some renovations can add major value to your home, not to mention the increased curb appeal and added comfort that customizing and upgrading your place can offer. In fact, 26 percent of U.S. homeowners plan on making bathroom remodels or additions in the next two years, while 22 percent plan to renovate or add on to their kitchens.

Whether you’ve been planning upgrades for months or you’re remodeling your living room after it suffered storm damage, it’s important to manage your homeowners insurance policy accordingly to help ensure your coverage is sufficient to financially protect your additions.

Before Your Home Remodel

You may be eager to get started on your renovation project (and rightfully so), but it’s key that you speak with your home insurer before beginning a home remodel for a number of reasons.

1. Ensure your coverages and limits are appropriate and adequate

If you’re adding square footage to your home, upgrading all your appliances, or renovating your roof with hail-resistant materials, there’s a good chance your home’s rebuilding cost will go up. And you’ll want your homeowners insurance coverage to reflect this increased reconstruction cost, in order to help ensure you’re not left footing a chunk of the bill if you file a claim.

2. Make sure your home office is protected 

If you operate a home day care, an online shop, or an at-home consulting business, you’ll want to make sure all your business-related materials (computers, desks, office chairs, etc.) and any potential work-related liability exposure (a client trips and falls, for example) are financially protected. Depending on the nature and scale of your at-home business, you may want to consider an in-home business policy, a business owners policy, or an endorsement for your homeowners policy. Your insurance company can help explain your options to you.

3. Cover your personal liability during renovations

Say a guest or trespasser trips over some loose tile around your pool while you’re remodeling it, and decides to sue for their injuries. If your homeowners insurance company wasn’t informed of your project before your liability claim, your claim could be denied. On the other hand, you could be covered for any potential incidents if you keep your insurer in the loop.

After Your Home Remodel

You’re probably ready to put your feet up as soon as your home project is complete, but consider a couple of insurance to-dos before resting on your laurels.

1. Update your home inventory

If you don’t already maintain a home inventory, now’s the time to make one. It documents all the essential aspects of your home, from characteristics of the dwelling itself to all the belongings inside. After a home remodel, update your home inventory to ensure your additions are fully accounted for.

Keep receipts, and take photos and video of your finished home projects. A thorough, up-to-date inventory can significantly expedite the claims process in the event of a loss, and can also help you get the most from your homeowners policy. Consider keeping copies of the photos and videos off premises or digitally in the cloud for additional peace of mind.

2. Talk with your insurance provider about coverage limits

Now that you’ve upgraded your kitchen, bath or other living quarters, touch base with your insurance company to make sure that this information is reflected in the amount of coverage provided through your dwelling protection. Remember that all upgraded building materials are important in determining the full amount of coverage needed to protect you in the event of a loss.

3. See if you could be saving on coverage

If your home remodel increased your home’s replacement cost and your homeowners coverage limits increased as a result, there’s a chance you’ll be paying a higher premium for that additional coverage. That’s why it’s a wise idea to get a few quick quotes to compare what other home insurers charge. You may find that you’re able to save some money—but be sure to discuss the fine print with an agent before making the switch.

Even if you don’t plan on shopping around, ask your current insurer about any discounts that you may qualify for now that you’ve made updates to your place. Many insurance companies offer discounts for hail-resistant roofs, eco-friendly appliances, storm shutters and burglar alarms, to name a few.

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Jeffrey Ill serves as Vice President of Homeowners Products at  Esurance. As a veteran in the insurance industry, Jeff has worked in several leadership roles and has supported a wide range of product implementations. His 30+ years of experience have helped him to draw insights for his writing.

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