Renovating Your Home? Here’s Why Your Insurance Carrier Needs to Know

For many homeowners, a renovation project is an exciting investment, whether it’s a kitchen transformation, an addition, or a full-scale remodel. But while most attention is focused on contractors, budgets, and timelines, one critical detail is often overlooked: your homeowners insurance.

At JKJ, we work closely with clients throughout the renovation process to help ensure their coverage remains aligned with the changing risks associated with construction. Failing to notify your insurance carrier before work begins can create serious complications if a claim occurs during the project.

Here’s what homeowners should know before renovations begin:

Why Renovations Impact Your Insurance Coverage

Any significant renovation changes the exposure associated with your property. Construction activity increases the likelihood of risks such as:

• Fire or water damage
• Theft of building materials or fixtures
• Injuries involving contractors or workers
• Liability exposures from construction-related accidents
• Vacancy risks if you are living elsewhere during the project

Because of these added exposures, insurance carriers typically require notification before substantial work begins. “Substantial” is a subjective term, so your personal insurance advisor can help you determine if any policy revisions are needed prior to your start date.

Information Your Insurance Advisor Will Need

Before notifying the carrier, your advisor will typically request several details about the project, including:

• The full scope of work being performed
• The anticipated budget
• Estimated project start and completion dates   
• Whether the homeowner will remain in the property during construction
• Whether you have signed a “Waiver of Subrogation” against your Contractor(s)

This information allows the carrier to properly evaluate how the planned work may affect your coverage.

What Happens After the Carrier Is Notified?

Every insurance carrier handles these situations differently, but there are generally three possible outcomes.

Best-Case Scenario

In some cases, the carrier simply requests notification once the project is completed. No immediate changes are made to the policy, and any updates are addressed after construction concludes.

Most Common Scenario

More often, carriers require additional underwriting documentation, such as a renovation questionnaire, and may apply temporary surcharges to the homeowners policy during construction.

These surcharges may be applied to account for:

• Course of construction exposure
• Vacancy-related exposure if the home will not be occupied

It is also common for carriers to require certificates of insurance from the general contractor, showing proof of:

• General Liability coverage
• Workers’ Compensation coverage

Depending on the scale of the renovation, temporary premium increases can be substantial, sometimes 60% or more of the annual homeowners premium. However, these increases are temporary. Once the project is complete and the property is re-inspected, surcharges are typically removed and any unearned premium may be refunded on a pro-rated basis.

Worst-Case Scenario

In more extreme situations involving a substantial and prolonged renovation, a carrier may determine that the exposure no longer fits its underwriting guidelines. This can result in:

• Mid-term cancellation
• Non-renewal of the policy at the expiration date

While less common, it is important to prepare for this possibility. If it occurs, your insurance advisor can help secure temporary alternative coverage until renovations are complete.

Why Disclosure Matters

One of the biggest mistakes homeowners make is assuming their homeowners insurance provider does not need to know about ongoing work. Unfortunately, if a significant loss occurs during construction and the carrier was not informed of the increased exposure, it could lead to:

• Delays in claim handling
• Coverage disputes
• Partial denial of a claim
• Full denial based on material misrepresentation or undisclosed risk changes

The purpose of notifying the carrier is not to complicate the renovation process — it is to protect the homeowner and ensure proper coverage remains in place throughout the project.

Planning Ahead Protects Your Investment

Renovating a home is a major investment, and insurance should be part of the planning process from the onset, not an afterthought once construction has already begun.

Working proactively with your insurance advisor helps:

• Avoid unexpected coverage issues
• Ensure contractors meet insurance requirements
• Keep your policy compliant with carrier guidelines
• Maintain protection throughout the renovation timeline

If you are planning renovation work to your home, the Personal Insurance Team at JKJ can help guide you through the insurance considerations before construction begins.