A home renovation is a big, complex project and, with the best intentions in the world, things can and do go wrong. That's why it’s worth finding out whether you need home renovation insurance before starting.
Home renovation insurance is a special type of cover that protects you and your property while renovation work is being carried out. Most standard home insurance policies cover DIY or cosmetic work like redecorating but not major renovations. This is because heavy duty or complex work increases the chances of something going wrong and, therefore, you making a claim. It also goes by a variety of other names, including building work or renovation insurance, site insurance, extensions insurance or house refurbishment insurance, to name just a few.
Home renovation insurance covers you against unforeseen circumstances like subsidence, fire, water or structural damage to the building or its contents. It also covers break-ins and theft of personal property, building materials or equipment. Also, alternative accommodation if damage caused by building works means you have to move out temporarily. It should also include public liability so you’re covered for legal and medical costs and any claims made against you if someone is injured on or near the site. This can include passers-by and intruders (yes, really).
The extent of home renovation cover varies depending on whether the property is occupied or not, and whether you’re doing any of the work yourself. Depending on your insurer and current level of cover, you may need to take out a new policy or extend your existing one.
Home renovation insurance is usually paid for in a lump sum and calculated according to the level of risk based on your postcode, rebuild value of the property, type and value of the renovation work and the duration of the insurance.
If you’re hiring a general contractor or home renovation company, they should have their own insurances (if not, run!). However, these may not be comprehensive or cover all eventualities so always check first what’s included. For example, at JM Construction we have our own insurance, public liability, indemnity, employer’s liability and trust mark insurance etc. to cover ourselves and our work, but we strongly recommend taking out home renovations insurance to cover everything else.
You need home renovation insurance to carry out extensive work or make structural changes like knocking down or rendering walls. You also need it if you will be vacating the property for the duration of the renovation since an unoccupied house is more at risk of break-ins. Usually, you’ll need to move out if renovation work makes certain essential areas of the house unusable or inaccessible. For instance, if you’re completely refitting your kitchen or sole bathroom, you won’t be able to use them until they’re done so you need to live somewhere else in the meantime. Usually, home renovation insurance is required if the property is unoccupied for over 30-60 days (the period usually covered by most home insurance policies).
You also need home renovation insurance if storing expensive materials and equipment on site. Ditto for certain types of renovation like a full kitchen remodel, full house electrical rewiring or building an extension or conversion, including lofts and garages. The good news is you don’t need it for minor jobs like replacing cabinets or sanitaryware or doing simple cosmetic upgrades.
It’s also worth looking into party wall insurance, which covers any damage to your neighbour’s property. Crucially, they may be able to claim against you even if the damage is to a structure that’s not adjacent to your property. Your contractor’s insurance may only kick in if negligence can be proved.
Finally, if you’re building a house from scratch, you’ll want to look into self-build insurance. This doesn’t mean doing the work yourself, but rather contracting it out to a builder as opposed to buying it ready-built.
You must inform your insurer and check whether you need home renovation insurance before embarking on a project. If you don’t, your existing policy could be invalidated and you won’t be covered for any incidents or claims.