How Home Improvements May Affect Your Homeowner Insurance

For most of July and the first half of August, we celebrate Air Conditioning Appreciation Days in the U.S. and Americans from New Jersey to Arizona certainly appreciate the relief of having that fresh cool air on these hot summer days. In addition to enjoying the air conditioning we already have, summer is also a great time to think about getting a new HVAC unit and making other improvements to your home. Before you start your home renovation project, it is a good idea to take a look at your insurance needs both during and after the project is complete.

Cover Yourself from the Start: When you are in the planning stages of a home improvement project, you should make sure that the people you have working on your home are fully licensed, bonded, and insured. Ask to see proof of this because if anything happens to them while working on your property, it is important for them to be protected. In addition, be sure your project is up to code. If you have an older house, it may have been several decades since any work has been done on it. During that time, local building codes and regulations may have changed quite a bit. Check with your insurer to see if you have law and ordinance coverage in your homeowner policy, this may provide additional coverage for repairs to damaged property.

Adjust Your Homeowner Insurance Coverage: As you near completion of your home improvement project, you should contact your agent to make the appropriate adjustments to your homeowner’s insurance policy. For example, if you added a new room or finished the basement, replacement cost for your dwelling may have increased by several thousand dollars. If you fail to report this to your insurer, you might not be fully covered in the event that your home ever needed to be rebuilt. Your insurance company will be able to recalculate the new replacement cost of your home after the improvements are complete to ensure that your home continues to be fully insured.