5 Things to Know When Making Home Improvements
We can all start to breathe a sigh of relief as we’re exiting the cold, harsh winter season. The weather is getting warmer, the birds are chirping, and spring is finally upon us. It’s hard to avoid getting inspired to de-clutter your space, and start planning home improvement projects.
Between planning, building Pinterest boards, and all the excitement – the last thing on your mind is speaking with your insurance agent, right? Total buzzkill.
Any home improvements that you make to boost the value of your home could leave you vulnerable to losses without adequate coverage. Other upgrades, such as energy-efficient upgrades, could even trigger lower premiums. Who wouldn’t want to save some money by simply giving your insurance agent a call?
Here are some home improvement projects that can impact your insurance coverage:
A brand new roof.
Not the sexiest of home improvements, but if your roof was leaking during the winter months, you might be getting ready to replace it. Especially before the monsoons hit here in Arizona. A new roof could cut your premiums by 5%, sometimes even 15%! Why such a huge cut, you ask? Heavy rain, hail, and snow contribute to the largest amount of insurance claims.
So if you’re replacing your roof, you’ve significantly reduced the risk of damage, thus reducing your insurance premium. If a new roof is on the top of your home improvement list, make sure you contact your agent to see what documents they require to get your discounts!
Adding a swimming pool.
Cannonball! You’re now the coolest house on the block, and all your kids’ friends are wanting to come over to cool off from the scorching desert heat. All the pool parties, BBQs, and summer hangouts are all that’s on your mind right now. But wait! Adding a pool means adding more risk. Standard homeowners policy covers about $300,000 in personal liability protection – but you may want to opt for more in the event there’s an injury on-site, where you’d be responsible for medical bills or other losses. And don’t forget that Arizona State Law requires the addition for enclosures or fences for residences with children under the age of 6 years old.
Having pool add-ons such as diving boards or water slides also add to your risk. Make sure you talk to your insurance agent once your plans are set to make sure you’re adequately covered. The last thing you want is to be underinsured and have to come out of pocket for any mishaps that happen!
An office for a home business
You’re finally ready to make the leap and take entrepreneurship on full-time. That’s great! Most homeowners policies cover up to $2,500 in equipment for your home based business, but that might not be enough if you’re going to be using special equipment. Fortunately, you may just need to add a little extra cushion to your existing policy. But if there’s more complexities, it may be best to purchase a separate business policy. Make sure you take the time to talk to your agent to determine the most cost-effective way to ensure you’re protected in the event of a loss.
Expanding your living space.
The extra storage an attic offers seems enticing after the extravagant Christmas, doesn’t it? Or perhaps adding on an Arizona sun room to soak up the beautiful morning sunrises with a cup of coffee is on your to-do list.
Regardless of your expansion, anytime you’re planning on adding on square footage to your home, talk with your insurer first. Let’s say a fire happens when you’re three-quarters of the way through, you want to make sure you can rebuild without worrying about out-of-pocket expenses.
Think about how the extra space will be used. If you plan on renting out the additional space, make sure you’ve got landlord coverage to protect you. Or if you’ve built a basement with carpet, you may want to consider water backup coverage just in case flooding occurs.
Kitchen or bathroom makeovers.
Overhauling your kitchen into a chef’s dream, or your bathroom into a spa-like retreat is thrilling. But the most common mistake people make is not giving their homeowners policy a makeover, too. Your gorgeous renovation could be at risk.
Let’s say your homeowners policy is based on laminate floors and generic cabinets. Then you decide to put in teak flooring, granite countertops, and maple cabinets. Would your existing policy be sufficient to rebuild your remodeled kitchen? This is something many don’t even consider until after a loss.
Contact your agent beforehand, and take lots of before and after photos to keep on file, to validate the work being done. Your premium may go up because your home is worth more, but there’s also a chance that if you’ve upgraded electrical or plumbing systems (especially if your home is older), then you could qualify for a discount!
If you’ve got home improvement projects on-deck for this spring and summer, give me a call! Let’s make sure you’re protected and your precious new investments are covered.