Homeowners Insurance After a Major Renovation or Alteration

If you plan on making any home renovations, alert your insurance company beforehand. Premiums for homeowners insurance after a major renovation or alteration can increase or decrease depending on what kind of changes you make to your home. You also need to confirm that your current home insurance policy will cover a major renovation. If not, you will have to purchase more coverage.

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Natasha McLachlan is a writer who currently lives in Southern California. She is an alumna of California College of the Arts, where she obtained her B.A. in Writing and Literature. Her current work revolves around insurance guides and informational articles. She truly enjoys helping others learn more about everyday, practical matters through her work.

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Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance for 10 years. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate...

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Reviewed by Laura Walker
Former Licensed Agent

UPDATED: Nov 22, 2020

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If you are planning to make changes to your home or undergo renovations, it is important that you also keep your home insurance in mind. Notify the insurance company ahead of time that you plan to make changes, and how they will affect home’s value. By conforming to the requests of the insurance company, you can eliminate the possibility of having a future claim denied.

Unless you are a licensed contractor, do not perform the work yourself. Many insurance companies will only provide coverage for work that is done professionally. It may not be a difficult task for you to add on a new room, but the work could be all for naught if your insurance company refuses to extend coverage to the new addition.

Take pictures or make videos of the work area before you begin, and maintain a running series of updates as the work progresses. If you are able to document exactly what was used and how the work was done, you will be in a much better position to have a future claimed honored and the damage repaired to the post-construction condition.

Keep in mind that the work you have done will affect your insurance premiums. Home insurance is typically based on the square footage of the home as well as its condition and current market value. It is also important to note that improving the home far above the base value of other homes in the area will not necessarily increase your home value.

Once the work is complete, take a new home inventory which includes any furnishings you are putting into the new room, or itemizing the alterations you have made. Submit the home inventory to your insurance along with a request to increase the coverage for the new value of the home. Be prepared to negotiate, but you do not have to blindly accept the first offer your insurance company makes. If you are unable to reach a mutual agreement with your insurance company, you do have the right to shop around for a different carrier.

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