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Home improvements and renovations - what you need to know about insurance

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Another year, another round of Brexit negotiations. Who knows what those are likely to bring? And of even greater concern perhaps, for the average homeowner, who knows what the effects are likely to be on the housing market?

Rather than attempting to sell your home in an uncertain market and look to buy another, you may be considering improving – or even renovating - the one you already have. 

Improvement ideas – modest and grand

You are unlikely to be short of ideas for a whole range of renovation projects, from the more modest to the undeniably grand. House Beautiful, for example, has published 50 ideas, costing less than a £1 each, for giving your home a new look; Homebuilding and Renovating magazine, at the other end of the scale, has shown how a handful of homes may be completely transformed through major renovation projects.

Renovation insurance 

Unless your ideas for renovation extend no further than a selection of ultra-budget cosmetics or the odd lick of paint, they are likely to involve reconfiguring the internal layout by knocking down walls or adding an extension.

Whenever such structural alterations are concerned, your existing home building insurance is unlikely to be adequate – indeed insurers typically exclude cover for structural damage to your property during such works.

The Association of British Insurers (ABI) points out, therefore, that you are likely to need additional insurance – and the name appropriately given to such specialist protection is renovation insurance.

What it covers

In the absence of adequate protection for the existing structure of the building through your standard home insurance policy, renovation insurance provides just that cover for any loss or damage arising from the building works. 

Once the works are complete, you may revert to your standard home insurance policy, but need to re-evaluate and update the total building sum insured to reflect the enhanced value of your renovated home. 

Building projects are notoriously prone to delay and changes to completion schedules. To reflect such changes and to ensure that you remain adequately protected, renovation insurance typically allows sufficient flexibility for extensions as and when necessary. Furthermore, you may arrange the cover for as long as you need – if the building works are to take just three or six months, for example, the period of cover may be for those months alone and not the full 12 months otherwise associated with most other forms of general insurance.

A further critical component of renovation insurance is the protection it offers during those periods when your home needs to be left empty, with no one living there whilst the work is in progress. Although the builders may be in during working hours, your existing home insurer is likely to consider the property to be unoccupied if no one is living there on a continuous basis, day and night.

According to such definitions, once your home has been unoccupied for longer than 30 to 60 consecutive days (the precise period depending on your current insurer), cover typically becomes severely restricted or may lapse altogether. Thanks to its inclusion of unoccupied property cover, renovation insurance may fill the gap then left by standard home insurance policies.