Home Additions and Remodels Can Affect Your Home Insurance: A Guest post by Nathan Barber at QuoteWizard
Whether you are updating your bathroom, kitchen, building a deck, or adding another room to your house, you are likely increasing the value of your property. In one way, shape, or form, your home’s value influences your home insurance rates and coverage.
With special home additions, such as a new deck, you have more room and features to cover. With a small increase in home insurance rates to follow, it is highly recommended that you let your policy holder know of the addition. This is because your home insurance covers your home’s current value. With more space, your home is worth more, meaning that you want to make sure your policy coverage is on par with your home’s value after the addition.
It is worth it to let your home insurance company know of the work done so that you can ensure everything is covered. With the minimal increase in home insurance rates, the pros far outweigh the cons for letting your policy holders know of the additions. This is because if your home was ever damaged, your insurance company can expedite the claims process to fix the damage. Otherwise, your insurance company may hire a private home inspector to make sure there was no fraud or negligent behavior involved which can delay the fixes.
There are many additions, features, and special renovations that can add variable value of your home from your insurance’s perspective. For example, building materials plays a large part on the value of the renovation or addition. Higher quality raw materials mean higher value because it is likely a higher cost to replace. You want to take note of the materials because if something ever damages your home, your insurance company needs to know the costs to replace the damage. You don’t want your insurance company to assume average costs because you may get the low-end of the price, meaning that you would lose money on the claimed damage.
Another aspect is special architectural features. A new mother-in-law apartment would cost more to replace. Which all need to be covered by your home insurance policy. You don’t have to tell your insurance company know, but it recommended that you let your insurance company know before your project. Again, this speeds everything up, and offers you a chance to negotiate better rates if you felt inclined. It is always recommended that you investigate saving money on your home insurance. You may find that you are missing a decent discount opportunity that was overlooked when you signed up for the policy.
Another aspect you need to take not of is your liability coverage. Adding a deck comes with a beautiful addition to your home that enables you to relax and kick back. But, it does add an increased risk of injury. For example, basic liability is $100,000. This protects you from claims by others for bodily injury or property damage. With additions like a deck, you might want to consider increased coverage to $500,000 which only costs around an extra $25 dollars a year.
There are many variables that go into your home insurance coverage, and home additions can have a large effect on the value of your home. You want to make sure you are fully covered, so letting your insurance company as soon as possible about your update and/or renovation is highly recommended