Home improvements and renovation insurance

Does home insurance cover home renovations?

Planning any type of home improvement, whether it's digging out the basement or converting the loft, is always an exciting prospect. But you must think of the practicalities before you start smashing down a wall or ripping out a bathtub.

There are many things that can go wrong along the way, and you should ensure you’re protected against financial loss that can turn your dream home project into an expensive nightmare.

DIY

Planning on having a go yourself? Make sure you know what you’re doing before you start rummaging through your toolbox.

Some policies won’t provide cover if you drill through a water pipe, so getting a professional to do the work might save you money overall. Alternatively, you could look at adding accidental cover to your contents policy. But read the small print about whether DIY work is covered.

Remember, you’re unlikely to make a successful claim on your home insurance if you attempt to do electrical, plumbing or gas work you aren’t qualified to do too. And if you cause damage through your own dodgy workmanship, your policy probably won’t pay out either.

Major structural work

The majority of standard home insurance policies don’t allow for renovation work.

Just 19% of 303 building insurance policies listed on Defaqto^[1] include a minor building works limit – this is where you can get on with having work done (up to the value given in your policy) without telling your insurer.^[1]

For those without this type of cover, it’s important to tell your insurer about work. If you don’t, the terms of your home insurance may be invalidated which means you won’t be able to make a claim.

Should I tell my home insurer about building work?

Yes. If you don’t tell your insurer that your home is undergoing renovation your policy may become invalid in the event of a claim.

If something goes wrong and you haven't got the right cover, you could find yourself facing some hefty bills.

Crucially, contact your insurer before building work starts to find out whether your policy includes renovation work, and if not, what you need to get cover while the building project takes place.

Let your insurer know when you’re in the planning stage and be very clear about the work you’ll be having done. You can then discuss the type of insurance you’ll need and whether you’ll be covered for the building work or if you’ll need specialist insurance.

If your works are relatively minor, your current policy may cover you, or you may need to pay a small additional premium to boost your protection. Just make sure you understand exactly what will be covered.

Plans inevitably change along the way during a renovation project, just make sure you keep your insurer informed. It's not worth taking a risk with your biggest asset.

Homeowners who are not properly insured could be left paying a mortgage on a property they can no longer live in, with no money to find another home.

Why you should tell your insurer

Having builders on site increases the risk of windows and doors being left open or unlocked.

If you don’t let your insurer know about the building work, accidental damage caused by tradespeople might not be covered, and you wouldn’t be covered if a burglary occurred due to a door being left unlocked either.

Your home could be left uninsured if you fail to tell your insurance company that you’re undertaking renovations.

What jobs does my insurer need to know about?

Your insurer should be told about structural changes to the layout of your home, removing a load-bearing wall, adding an extension, converting a loft or garage, a new roof, as well as large cosmetic improvements such as ripping out a kitchen and fitting a new one.

What don’t I need to tell my insurer about?

It’s unlikely you’ll need extra insurance if you’re just having the kitchen or bedroom painted or a few new wall units fitted. It's possible your provider may cover you without needing to change your policy - but it's always best to check first.

What details should I provide my insurer with?

You’ll need to explain the nature of the improvements being made, when the work is due to start and finish, the cost and how long it will take.

Also, whether you’re still going to be living there while the work is done, or if you’ll be moving out until the work is complete.

Your insurer will likely want the name of builders hired and whether they have public liability insurance.

What to do if there’s building work occurring while you’re getting a home insurance quote

If your insurance provider doesn't know about your building work and your plans for adding an extension, it may invalidate your policy.

You’ll need to make your insurer aware of the work you’re doing and get any extra cover required in place as soon as possible.

By contacting your insurer, you can check if your home will be covered and find out whether you’ll need additional or specialist cover for it to be fully protected.

What insurance do I need when renovating a house?

Every project is different so there’s no one size fits all option.

You may want accidental damage cover in the event of paint spillage on your carpet during redecoration, for example.

Consider legal expenses cover if you’re undertaking a large renovation job. It will pay out should you need to take legal action against a builder for shoddy work.

You’ll also want a policy that covers theft of building materials, tools and equipment from the site.

When you choose tradespeople to work on your home, always check they have their own insurance in place as well to cover work they’re doing and any damage that might happen. It’ll usually cover any damage done to your neighbours’ properties as a result of the building work, too.

However, there are limitations on what their policy will cover, particularly if the work damages the existing property so it’s important to have your own comprehensive policy.

Will renovations increase the cost of your home insurance?

When you make home improvements it will often add value to your home, which will likely increase the rebuild value. This can bump up your premium.

You might also add more valuable appliances or items to your home in the process of a renovation so you may need to increase the value of your contents insurance.

Do you need planning permission to renovate?

When it comes to home improvements, some changes can be made under your permitted development rights, where you don’t have to get approval. Others will require you to submit a planning application to your local authority for review.

Broadly, most internal improvements such as loft conversions, a new bathroom or kitchen, or converting a garage won’t need planning permission. Though if you need to raise the height of a roof for a loft conversion, you’ll need to have planning permission approved.

If the work isn’t carried out by qualified professionals and with the correct permits and permissions, you’re unlikely to be covered if something goes wrong with the project. You may even be required to reverse your improvements if they’re not approved by the council.

If you do any building work to your home, whether you need planning permission or not, you should always discuss plans with your insurer.

Can I get specialist insurance for renovation work?

A specialist policy called renovation insurance is designed to specifically cover a home while you’ve got builders and other tradespeople in.

Policies vary from insurer to insurer, but it will usually cover accidents, since there’s a higher chance of one occurring during building work.

If you leave your house unoccupied for 30 days or more due to the works on your home, renovation insurance can provide cover, whereas it would invalidate a standard home insurance policy.

You may also have large amounts of expensive materials, equipment and tools at your house that’ll need to be covered against damage or theft.

The policy should include public liability insurance in case of injury during the renovation and legal cover if you run into dispute with your tradespeople.

It can also pay out for alternative accommodation if things go wrong which require or force you to move out.

Theft or damage of your personal possessions could be included too.

If you’re considering taking out renovation insurance, you should compare prices from a range of insurers to get the best deal.

What it won’t cover

Home renovation insurance won’t cover faulty or poor work. That’s one of many reasons why you’ll want to choose your builder carefully.

It’s best to use a reputable builder who’s a member of an association such as the National Federation of Builders or the Federation of Master Builders - and that your contractor has insurance.

What should I do when the renovations are complete?

Tell your insurer when the builders are gone and the job is done. Your insurer can then help update your home insurance, making sure you’ve got the right level of cover and that it reflects the new rebuild value of your home.

You should also flag any new high-risk or high-value additions to your renovated home. This may affect the price of your premiums.