How renovations affect your home insurance
Summer is the perfect time when millions of people take advantage of the fine weather to renovate and improve their homes. In Canada, the Statistical Society of housing and mortgages show that in 2009, more than 2.1 million Canadians have begun renovations costing $ 1,000 or more. Renovations can increase the value of your home, providing extra space, and help keep your home in good condition.
If you are planning a renovation, be sure to inform your insurance company of your plans so that your home insurance policy remains in effect during that period. Some types of changes to your property can affect your insurance policy and if something were to happen, you may find that your insurance does not cover perils that you expected to cover.
Reasons to notify your insurer
Here are some of the reasons why your insurance company must be notified of all the renovations to your property:
1. Renovations can increase the value of your home
Your home insurance protection is intended to cover the replacement cost of your home in case of fire or other damage. All that influence the replacement cost of your home can also affect the cost of your premium and the amount for which you are insured. Be sure to inform your insurance company as soon as possible when you make significant improvements. They may require receipts to show that the work was done.
2. Cancellation of your policy for vacancy
Most home insurance policies require that the house remains occupied while she is assured. The reason for this is that the houses that are occupied are less likely to be burglarized and more likely to be well maintained. If you must leave your home for a long period of time while renovations are underway, you can apply for a permit vacancy with your insurer. Permits vacancy can cost a few dollars more, but they allow you to maintain coverage while you are away from home.
3. renovations can change the class of your insurance
If you make major renovations such as the replacement of an exterior wall or roof, your insurance company may change your premium to that of a building under construction, rather than a single family home. The reason for this is that your belongings in the house are covered by your insurance policy as well as the building itself. If there is a damaged roof or missing walls that may affect the state of the contents of your home, your insurance company may choose to exclude your policy during the renovation period.
4. You may be liable for injuries to workers on your property
If a renovation worker or someone is injured on your property you may be liable for costs and damages associated with this injury. Before you hire a contractor, you should check with the Better Business Bureau and make sure they have insurance for their employees. You should also consult the amount of liability coverage you have, it may be worth increasing your coverage during the renovation period just in case something happens to a third party on your property.
5. You never know what you can find
If your house is quite old, renovations can make you discover potentially dangerous shortcomings, such as galvanized plumbing or other materials that do not conform to the building code in effect. Some of these changes can significantly affect the scope and duration of your renovation project and therefore your insurance coverage.
The best idea is to work closely with your agent or insurance broker and keep them informed of the scope of your renovation. If you have any questions, do not hesitate to ask. Your insurance professional is there to help and can find all the information you need.
Do not forget to compare
Once your renovations are completed, make an appointment with your insurance professional to discuss the changes and to discuss whether your insurance coverage needs to be changed. This may or may not increase your current rate. If you then experience an increase in your home insurance premium, remember that you still have the opportunity to compare your policy with other suppliers, which could offer a cheaper package. Even including your renovation, you might be able to get the same coverage at a lower rate.
Summer is the perfect time when millions of people take advantage of the fine weather to renovate and improve their homes. In Canada, the Statistical Society of housing and mortgages show that in 2009, more than 2.1 million Canadians have begun renovations costing $ 1,000 or more. Renovations can increase the value of your home, providing extra space, and help keep your home in good condition.
If you are planning a renovation, be sure to inform your insurance company of your plans so that your home insurance policy remains in effect during that period. Some types of changes to your property can affect your insurance policy and if something were to happen, you may find that your insurance does not cover perils that you expected to cover.
Reasons to notify your insurer
Here are some of the reasons why your insurance company must be notified of all the renovations to your property:
1. Renovations can increase the value of your home
Your home insurance protection is intended to cover the replacement cost of your home in case of fire or other damage. All that influence the replacement cost of your home can also affect the cost of your premium and the amount for which you are insured. Be sure to inform your insurance company as soon as possible when you make significant improvements. They may require receipts to show that the work was done.
2. Cancellation of your policy for vacancy
Most home insurance policies require that the house remains occupied while she is assured. The reason for this is that the houses that are occupied are less likely to be burglarized and more likely to be well maintained. If you must leave your home for a long period of time while renovations are underway, you can apply for a permit vacancy with your insurer. Permits vacancy can cost a few dollars more, but they allow you to maintain coverage while you are away from home.
3. renovations can change the class of your insurance
If you make major renovations such as the replacement of an exterior wall or roof, your insurance company may change your premium to that of a building under construction, rather than a single family home. The reason for this is that your belongings in the house are covered by your insurance policy as well as the building itself. If there is a damaged roof or missing walls that may affect the state of the contents of your home, your insurance company may choose to exclude your policy during the renovation period.
4. You may be liable for injuries to workers on your property
If a renovation worker or someone is injured on your property you may be liable for costs and damages associated with this injury. Before you hire a contractor, you should check with the Better Business Bureau and make sure they have insurance for their employees. You should also consult the amount of liability coverage you have, it may be worth increasing your coverage during the renovation period just in case something happens to a third party on your property.
5. You never know what you can find
If your house is quite old, renovations can make you discover potentially dangerous shortcomings, such as galvanized plumbing or other materials that do not conform to the building code in effect. Some of these changes can significantly affect the scope and duration of your renovation project and therefore your insurance coverage.
The best idea is to work closely with your agent or insurance broker and keep them informed of the scope of your renovation. If you have any questions, do not hesitate to ask. Your insurance professional is there to help and can find all the information you need.
Do not forget to compare
Once your renovations are completed, make an appointment with your insurance professional to discuss the changes and to discuss whether your insurance coverage needs to be changed. This may or may not increase your current rate. If you then experience an increase in your home insurance premium, remember that you still have the opportunity to compare your policy with other suppliers, which could offer a cheaper package. Even including your renovation, you might be able to get the same coverage at a lower rate.
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