Home Insurance During Renovations

Apr 18, 2022

Spring is here and many of us have plans to improve and repair our homes. Sometimes the improvements involve minor renovations, like painting, but other times we have bigger plans in mind like an addition or major renovations — these are the times to get in touch with your insurance broker.

Why do I need to call my broker?

If you are planning a renovation it is important to discuss the plans with your insurer, or broker, to confirm and clarify your insurance coverages.

There may be coverage exclusions in your policy while your home is under construction or renovation.   Exclusions will vary depending on the insurance company, but it will be important to discuss your coverage when planning the work.

At Oakville Insurance Brokers, we welcome the opportunity to connect with you and make sure you have the information you need to ensure you are properly protected.

What Could Happen?

Certain types of alterations to your property may affect your insurance policy and if something should happen you may find that your policy does not cover the perils you expected it to cover.  In a worst case scenario, your renovations could void your insurance coverage.

Here are some of the reasons you need to talk to your broker about your home renovation:

1. Renovations can increase the value of your home.

Your home insurance policy is designed to cover the replacement cost of your home in the event of a fire or other significant damage. Anything that affects the replacement cost of your home can also affect the cost of your premium and the amount for which you are insured. Make sure you inform your insurance company as soon as possible of any significant upgrades.

2. Vacating your home can invalidate your policy.

Most home insurance policies require that the home remain occupied while it is insured. The reason for this is that homes that are occupied are less likely to be broken into and more likely to be well maintained. If you have to leave your home for an extended period of time while renovations are being made, you can request a vacancy permit from your insurer. Vacancy permits may cost a few extra dollars, but they allow you to maintain coverage while you’re away from home.

3. Extensive renovations may change the classification of your policy or may require a different type of insurance policy.

If you’re undertaking substantial renovations such as replacing an exterior wall or roof, your insurance company may classify your home as “under construction” which automatically excludes a number of perils such as theft, vandalism & damage.  Depending on the extent of the renovations being undertaken, some insurer’s *will not* provide or continue to provide coverage.  In this case, a separate insurance policy called builder’s risk insurance is required during the course of the renovation.

4. Premium Reduction.

Not only can renovations raise the value of your home, but some upgrades can reduce your likelihood of an incident resulting in a claim.  Because of this, you may be eligible for additional  home insurance discounts.  Updates and upgrades to roof, heat, plumbing and electrical systems, as well as preventative upgrades such as sump pumps, backflow valves and alarm systems can reduce your home insurance premium.

Whatever your home upgrade plans, be sure to connect with your broker. We will work with you to ensure that you are properly protected.