Renovating your home? Make sure you’re covered first!
Home renovations can be nerve-wracking as well as exciting. The final results should improve your life and add value to your home, but the construction process that takes you there can be stressful, disruptive and costly.
With all the upheaval, it’s important to consider the implications for your insurance cover, too. Some works will be covered by your standard buildings insurance policy, for example decorative changes. If the work involves anything structural or major, such as knocking through walls, building an extension or adding a loft conversion, you should talk to your insurer to make sure cover is in place.
How will my insurer view my renovations?
Your insurance broker will look at a range of factors when considering whether your renovations are covered by your existing policy, or if a new policy is required. They will consider the type of work involved as well as the cost and duration to decide if you are covered.
If the renovations are found to be outside the scope of your insurance policy, you will need to purchase a different form of cover to protect you while the works take place.
What determines the risk level?
All insurance policies are calculated to reflect specific risks, so your insurer will want to know the detail of your plans. Obviously, if renovations make structural changes to the load-bearing parts of your home, this will increase risk. Leaving your home empty during the renovations this will also push up the applicable premium.
Your insurance broker will also want to know who will be carrying out the works. This might be a professional builder or craftsman, you, a family member or a combination of all of these. Your insurer might reduce the cost of your premium if the person carrying out the work has accreditations showing their expertise and experience.
Joint Contracts Tribunal (JCT) agreements
When you enter a contract with a builder, very often they will insist on the work being done according to a JCT contract. The JCT is an independent body which provides standard contract terms which apply to work of different levels of complexity, anything from minor works to the design and construction of an entire property. Using a JCT contract will often be recommended by architects.
Insurers usually want to know if your agreement is subject to a JCT contract because this will have a strong influence on how the work is carried out and paid for, and what will happen if a dispute arises. These are important elements to help the insurer calculate the level of risk.
Communication with your insurer
While it might be tempting not to tell your insurer that you are having building works in your property to avoid purchasing an additional policy, this could have severe consequences for you if something goes wrong. In a worst case scenario, if part of your home collapses then you will want to be sure insurance is in place to sort out the damage.
If your renovation adds to the value of your property, you should also make sure that your insurance policy is adjusted to reflect this once the work is complete.
So if you’re thinking of making changes to your current home – whether they’re large or small – talk to the experts at Computerquote today.