facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast blog external search brokercheck brokercheck
%POST_TITLE% Thumbnail

5 Home Renovations That Can Affect Your Insurance

Insurance

Many Retired Military Officers are Ready to Build The House

Throughout a career, many military officers will own their home. But since they usually live in them for a few years, major home renovations are usually not on the list. But after retirement, it may be time to build or renovate a purchased or previously owned house.

Planning a home renovation involves fun activities such as designing a new floor plan and picking colors. However, having a conversation with your insurance agent is essential, but it is often forgotten. Home renovations can increase your home value meaning your current home insurance coverage is inadequate leaving you vulnerable to losses. While other improvements can help you qualify for lower premiums. Below are five home renovations that could potentially affect your home insurance policy.

1. Getting a New Roof

Installing a new roof can save you money. With a new roof, you do not have to worry about expensive roof repairs or leaks. Other than the above savings a new roof can help cut your home insurance by 10 to 20 percent. The roof is the single most significant factor that can affect your policy.  Most insurance companies will offer a significant discount if you use stronger roofing materials that are leak, hail and wind resistant. Before installing the new roof, discuss with your agent (or USAA) your plans so they can explain whether you qualify for a discount. On the other hand, a new roof could increase your property value which means you need more coverage.

2. Building a Pool

Building a pool might make your home the most popular in summer, but it also makes it the riskiest in the block. When people are running around the pool having fun, there is a chance of an accident occurring. If a person does get hurt they could hold you responsible for any damages. Which in turn increases your personal liability protection. Your insurance premium will drastically increase after installing a pool. Some insurers will ask you to install a self-locking fence around the pool to reduce the cost of insuring the pool. Your homeowner’s coverage amount will also increase to compensate for the value of the pool. You may also want to consider an umbrella policy to protect you in case you are sued for more than the liability limits on your homeowners policy.

3. More Living Space

If your home is a little small, you might want to add space to have room for the kids when they come home to visit. Building a new addition such a second story bedroom or expanding the living room increases the square footage of livable space. Hence your insurance has to be altered to account for the value of the new space. 

4. Kitchen and Bathroom Renovations

Most homeowners will turn to the kitchen and the bathroom when they want to upgrade their home. They will turn their kitchen into a chef’s dream and their bathroom into a spa. What most homeowners do not realize is that the upgrades increase their home value. If you install high-quality counter tops, new appliances, and new flooring, ensure your insurance coverage is revised upwards, so you have sufficient coverage in case of a loss. You can also ask your insurance agent (or USAA) if you qualify for a discount if you upgraded the plumbing and electrical wiring. These upgrades reduce the chances of flooding and fires, hence reducing your premium.

5. Adding a Deck

A deck can be the social center of your home especially in summer, but having one installed can affect your insurance policy. Adding a deck can increase your home value, and it can also increase risk especially if it is attached to the second story. You should have your insurance policy revised after adding a deck because it increases your property value and your current insurance policy might not be sufficient to cover a loss. Your property value goes up and so does your coverage, meaning you have to pay higher premiums. As with the pool, you may want to consider an umbrella policy.

If you are considering having some work done in your home, talk to your insurance agent first to help you understand how the renovations affect your insurance policy. They will help you make the most of your discounts while still ensuring your home is adequately insured.


How does and Umbrella Insurance policy work?


Military Landlord? You have Estate Planning Issues


How Much Life Insurance do I need?



This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.


Disclaimer
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by C.L. Sheldon & Company, LLC ), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from C.L. Sheldon & Company, LLC . To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. C.L. Sheldon & Company, LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the C.L. Sheldon & Company, LLC ’s current written disclosure statement discussing our advisory services and fees is available for review upon request. DISCLAIMER OF TAX ADVICE: Any discussion contained herein cannot be considered to be tax advice. Actual tax advice would require a detailed and careful analysis of the facts and applicable law, which we expect would be time consuming and costly. We have not made and have not been asked to make that type of analysis in connection with any advice given in this blog post. As a result, we are required to advise you that any Federal tax advice rendered in this blog is not intended or written to be used and cannot be used for the purpose of avoiding penalties that may be imposed by the IRS. In the event you would like us to perform the type of analysis that is necessary for us to provide an opinion, that does not require the above disclaimer, as always, please feel free to contact us.