When undertaking any remodeling project in your home, such as updating the kitchen, adding a new bedroom, or even installing a pool in your backyard, your thoughts might first go to the design, materials, and overall improvement these changes will bring to your property. If you’re a homeowner embarking on such transformative home renovations, there’s another critical aspect you should consider according to a trusted home remodeler—your home insurance.
Understanding Changes to Home Insurance Rates
Renovations That Increase Insurance Rates: Home renovations generally add value to your property. While this is beneficial in the long run, it could mean that your current home insurance policy may no longer provide adequate coverage for your newly improved home. For example, adding luxury features like granite countertops or custom cabinetry in your kitchen can significantly increase your home’s replacement cost. Likewise, building an extension or adding a bedroom increases the livable space in your home, which can raise the amount of dwelling coverage you need.
The Case of Adding a Pool: Adding a pool to your backyard might seem like an attractive option to beat the summer heat. However, pools are considered “attractive nuisances” that can significantly heighten your liability risk. This, in turn, might lead to higher homeowners insurance premiums. Pools can increase the risk of accidents on your property, making it essential to reassess your liability coverage to protect against potential lawsuits from injuries occurring within your premises.
Upgrading Your Home’s Safety Features: On a brighter note, some renovations can lead to discounts on your home insurance premiums. Upgrading electrical systems, plumbing, adding storm shutters or a new roof can make your home safer and more resistant to damage. In turn, these improvements could lower your insurance rates by reducing the perceived risk and potential for claims.
The Importance of Discussing Renovations With Your Insurance Provider
Before diving into any major interior remodeling and renovation projects, it’s crucial to have a discussion with your home insurance provider. This conversation should cover the scope of your planned renovations and their potential impact on your home insurance coverage. In some cases, your existing policy might need to be adjusted to encompass the new value of your home post-renovation.
Additional Coverage Options During Renovations
Undertaking significant renovation projects, and exploring additional insurance options is advisable. These might include builders risk insurance, which covers materials and equipment during the renovation process, or a dwelling under construction endorsement for extensive remodels that significantly alter your home’s structure.
Ensuring Adequate Coverage
The goal of any home insurance policy is to provide a safety net that allows you to rebuild or repair your home if needed. Post-renovation, your home might be undervalued in your current policy, exposing you to out-of-pocket expenses in the event of a claim. Ensure your insurance policy reflects the true value of your newly renovated home to avoid such financial pitfalls.
While remodeling your home can bring about the excitement of creating more appealing and functional living spaces, it’s essential not to overlook the impact these changes can have on your home insurance. By proactively engaging with your insurance provider and updating your policy to match your home’s new value, you can enjoy your newly remodeled home with peace of mind, knowing you’re well-protected.
Let’s Start a Conversation!
When you search “home contractor near me“, it’s easy to find DreamMaker Bath & Kitchen of St. Louis Park! We are dedicated to transforming your home with custom solutions that bring your vision to life. Call us at (952) 522-3008, or fill out this contact form to schedule a consultation. We’re proud to serve homeowners in Golden Valley, Roseville, Vadnais Heights, White Bear Lake, and Stillwater.
