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Oklahoma Insurance Professionals LLC Blog |
Write something about yourself. No need to be fancy, just an overview.
When Sarah and Mike decided to expand their Oklahoma City home to include a new sunroom and upgraded kitchen, they were excited to add value to their property. What they didn’t realize was that their renovations could impact their homeowners insurance in ways they hadn’t considered. Renovations and additions may not automatically be covered under your existing policy, leaving potential gaps in coverage if something unexpected happens. Let’s break down how homeowners insurance interacts with home renovations and additions, ensuring you’re fully protected as you improve your living space. Why Renovations Impact Home InsuranceRenovations can increase the replacement cost of your home, which is the amount your insurer would pay to rebuild or repair your home if it's damaged. For example:
What Renovations Are Typically Covered?Most homeowners insurance policies include coverage for property damage and liability during renovations, but certain conditions apply. Here’s a closer look: 1. Minor UpdatesSimple projects like painting or replacing fixtures are usually covered under your standard homeowners policy. However, if the updates increase your home’s overall value, you may want to review your policy limits. 2. Major RenovationsFor larger projects—such as adding a room, finishing a basement, or installing a swimming pool—you’ll likely need to adjust your dwelling coverage to reflect the increased value of your home. 3. Temporary RisksConstruction projects bring unique risks, such as structural damage or theft of materials. Some insurers require additional endorsements or coverage extensions for these scenarios. Does Homeowners Insurance Cover Contractors?Standard homeowners insurance policies don’t usually cover damages caused by contractors. To protect yourself:
Common Gaps in Coverage for RenovationsRenovations can expose homeowners to specific coverage gaps, including: 1. Increased Replacement CostsFailing to update your dwelling coverage to reflect the improved value of your home can leave you underinsured. For example, if a fire destroys your newly renovated space, your insurance may only cover the original structure’s value. 2. Liability RisksAdding features like a pool increases the risk of accidents on your property. You may need to increase your personal liability coverage or invest in an umbrella policy. 3. Construction Site RisksStandard homeowners policies often exclude risks like theft of building materials or damages caused during construction. A builders risk policy may be required to address these issues. Tips for Ensuring Adequate Coverage1. Inform Your Insurer EarlyNotify your insurance provider before starting renovations. This allows them to adjust your policy or recommend additional coverage if necessary. 2. Review Replacement Cost CoverageConfirm that your policy includes replacement cost coverage rather than actual cash value, which factors in depreciation and could leave you paying more out of pocket. 3. Consider EndorsementsDepending on your project, you may need endorsements such as:
5. Document RenovationsKeep receipts and take photos of your upgrades. This documentation will help your insurance agent accurately assess the new value of your home. How Renovations Can Lower Insurance PremiumsCertain home improvements may qualify you for discounts on your homeowners insurance:
Oklahoma City: Home Improvements in Tornado AlleyIn Oklahoma City, renovations often come with additional considerations due to the region’s exposure to severe weather events like tornadoes and hailstorms. If you’re improving your home’s exterior or structure, ensure that materials are wind-resistant or storm-proof to qualify for regional discounts. Updating your policy to reflect these upgrades ensures financial protection in the face of natural disasters. Partner with an Independent Insurance AgentRenovations are an exciting way to improve your home, but they also come with financial risks. An independent insurance agent can help you navigate coverage options, ensure you’re protected during construction, and adjust your homeowners insurance policy to reflect your home’s new value. Working with local experts like Oklahoma Insurance Professionals means you get personalized advice tailored to your unique needs. Renovating your home is an investment in your property and lifestyle. With the right insurance coverage, you can protect that investment from unexpected risks. Before starting your next home improvement project in Oklahoma City, reach out to Oklahoma Insurance Professionals for a comprehensive review of your coverage options.
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