Summer is right around the corner and homeowners all over Maryland and the DMV are hiring home contractors to do major and minor home remodeling projects. 

Before doing a home remodel, you may want to consider the impact it may have on your homeowner's insurance. Home improvements may affect your insurance coverage and premiums, so it's crucial to understand how your homeowners policy may be affected. *** 

Here are several ways a home remodel can impact your homeowners insurance: 

1. Increased Property Value. Upgrades such as kitchen renovations, cabinet refinishing, bathroom remodeling such as new tubs, fixtures, and commodes, adding extra square footage, or repainting the interior or exterior of your home can enhance the overall value of your home. Notify your insurance agent about these improvements so that your coverage aligns with the increased value. If you don’t do it, it may result in being underinsured and having insufficient coverage if there is a loss.
2. Coverage limits changes. A home remodel may mean that you need to change your homeowner’s insurance coverage limits. As the value of your property increases, you may need to adjust the coverage limits on your homeowners insurance policy. This adjustment ensures that your policy provides sufficient coverage to rebuild or repair your home in case of damage or loss.
3. Added Coverage for Renovation Materials. During a home remodel, your property may have expensive materials and equipment on-site, increasing the risk of theft or damage. Some homeowners insurance policies may not automatically cover these renovation materials. Check with your insurance provider to determine if additional coverage is needed during the remodeling process to protect these items.
4. Temporary Relocation Coverage. You may also need to temporarily relocate during construction. So, review your homeowner's insurance policy to understand if it provides coverage for additional living expenses (ALE) during the relocation. ALE coverage reimburses you for costs such as hotel stays, meals, and other expenses incurred while you are unable to occupy your home.
5. Liability. Home remodeling projects involve contractors and subcontractors working on your property. They need to have appropriate insurance coverage, including general liability and workers' compensation. Getting proof of insurance from contractors protects you from liability in the event of accidents or injuries that occur during the renovation process.
6. Safety Measures and Upgrades. Some home remodels are safety improvements, such as fire sprinkler systems, security systems, or updated electrical and plumbing systems. These upgrades can lower the risk of potential accidents or losses, and they may qualify you for insurance discounts. Contact your insurance provider to discuss these safety measures and potential premium reductions.
7. Specialized coverage for unique features. Your home remodel may include unique features or high-end upgrades, such as custom-built structures, swimming pools, or luxury finishes. These items must be adequately covered. Specialized coverage is required to protect these unique features from damage, theft, or other risks. 
8. Home Insurance Premiums. A home remodel can affect your homeowners insurance premiums. Some renovations may increase your premiums due to the added value and potential risks associated with the changes, certain upgrades, such as installing a security system or upgrading your roof, may qualify you for discounts. Consult with your insurance provider to understand the potential impact on your premiums before proceeding with a home remodel.

A home remodel has numerous impacts on your homeowners insurance. Disclose to your insurance agent before and during the renovation process so that your policy aligns with the changes to your home and adequately protects your investment. By updating your coverage limits, considering additional coverage for renovation materials, understanding liability concerns, and exploring potential premium discounts, you can navigate through the home remodel with the homeowner’s insurance coverage that you need. 

For more information on home remodeling coverage and how it can be covered under your homeowners policy, contact our licensed and experienced insurance consultants at Lindquist Insurance. We can review your coverage with you and make sure your home is fully covered. Call (301) 694-0008 for an appointment. 

We serve the Annapolis, MD, and Frederick, MD areas. 

*** For more information on home improvements, visit the Montgomery County MD website.