Thinking about a DIY home improvement project? Maybe a new kitchen or bathroom makeover? Hoping for a low-cost renovation project that increases the value of your home?
All great ideas! Just remember to think about the insurance implications so you can make sure everything works out as planned.
The Home Improvement Research Institute (HIRI) says do-it-yourselfers complete two-thirds of home improvement projects — and spend less than those who depend solely on contractors. While saving money is satisfying, the sense of accomplishment DIYers feel is even better.
Here are five common renovation projects that may require additional insurance:
DIY Kitchen renovation
Maybe you’ve been dreaming of a new kitchen, one with quartz countertops and Wi-Fi-enabled appliances. Kitchen remodels can add convenience and significant value to your home, but there are a few insurance considerations:
• Depending on your level of experience, you may need the help of a plumber or electrician. Make sure the contractors you hire are bonded and insured. Do they carry liability insurance? Ask to see their certificate of coverage.
• Check with your agent to see if you should increase your homeowners coverage. If your renovation substantially increases the value of your house, you could be underinsured if you haven’t raised your limits. Generally, you need enough insurance to replace 80% of your home’s value.
• Will friends be helping you? Ask your agent about adding no-fault coverage or raising your medical expenses coverage.
DIY Bathroom makeover
You have visions of a soaking tub, new vanities and imported marble tile. Sounds delightful, but keep these points in mind:
• You may need a plumber to help you move a water line or drain. Bear in mind that water damage caused by your faulty workmanship won’t be covered by your homeowners policy. On the other hand, if you use a contractor, their business insurance should cover the damage to your home.
• Will that expensive marble be sitting in your driveway after it’s delivered? Costly materials have a way of walking away from a job site. Check to see if your policy covers theft or damage to your building materials.
DIY Home Office Renovation
You’ve decided to convert a spare bedroom into a home office. It’s an easy renovation, but here are some insurance considerations:
• Most homeowners policies only provide limited coverage (up to about $2,500) for office equipment. If you have items that exceed that amount, you’ll need additional coverage. Your agent can recommend some options.
• If you’re doing work for your firm at home, make sure you’re covered by the company’s business and workers’ compensation policies. If you’re self-employed, you may need a separate business policy, especially if clients visit your house.
DIY Sunroom Makeover
You’ve always wanted a room off the kitchen to take advantage of the morning sun. Sunrooms can provide enjoyment year-round, but you do need to keep a few things in mind:
• Talk to your agent about adding a new room to your homeowners policy. You may be able to get a discount if you install energy-efficient windows or heavy-duty locks on an exterior door.
• Is the project insured against severe weather? Theft or vandalism? You may need a builders risk policy.
DIY Finished basement renovation
You’re planning to create extra living space in the basement for your growing family. You’ve contracted to have a French drain and a sump pump installed to prevent water from leaking in. You’ve also decided to live in a friend’s house while you work on the project.
• If your house is unoccupied during construction, you may need vacant home insurance.
• Be sure to get a warranty on the French drain. Flooding isn’t covered by homeowners insurance. However, you can add water backup coverage to your policy to pay for damage if your sump pump fails.
• Game room? Home theater? Extra bathroom? You may need to increase the limits on your homeowners policy. On the other hand, upgrading old wiring or installing a security system could lower your premiums.