Home improvements can affect your Home Insurance
Britain is a nation of property nuts and when it comes to home improvements we spend an absolute fortune.
Recent figures from SAGA show that just over one in three homeowners splash out an average of £2,000 every year on changing their properties. As the price of buying a bigger and better property goes up, and to avoid the hassle and costs that go with moving, the mantra of many has become ‘Improve, don’t move’.
However, what plenty of property owners don’t realise is that they could be invalidating their Home Insurance by making improvements.
If major building work such as converting a loft into an extra bedroom or erecting a conservatory isn’t carried out correctly, following all the relevant permissions and regulations, or the insurer isn’t informed so that policy terms can be amended accordingly, then your cover may become null and void.
As the buildings element of a Home Insurance policy is based on a property at the point the insurance is taken out, it stands to reason that a change to the structure means that any existing cover may no longer apply.
And contents cover can also become invalid as a claim for loss of property or damage to possessions in an area of a building an insurer didn’t know existed will not be looked on favourably.
Failing to inform an insurer is an understandable mistake to make as there’s a lot to consider when having builders in and work completed. But to avoid what could be very costly errors, here are the key points to bear in mind:
- Contact your home insurer before starting any building work and let them know what it is you’re planning.
- Be very clear about exactly what work will be done; your insurer should tell you if you need to increase your cover for the duration of the build. If they don’t, make sure you ask if you should, and get them to put it in writing so you have a written yes or no
- If you fail to tell your insurer of any building work, and subsequently made a claim, the insurer could argue the property wasn’t as you’d indicated when you took out the insurance, and not meet the claim.
- Extensions and loft bedrooms will increase the cost of re-building your home in the event it was destroyed. As your buildings cover is still based on re-building the structure before an extension is built, for example, the sum insured might need increasing
- If you have put in new kitchens and bathrooms, you also may need to increase the buildings sum insured. This is particularly the case if you’ve spent a lot.
- In addition, any contents cover you have may need changing for the duration of the building work. You might need to add accidental damage to your policy to allow for any slip ups by builders and other workmen and contractors who will be in and around your property.
- Moving out while work is going on could also affect any claim you make. Your insurer will tell you for how long your policy allows you to be away from your property before your cover becomes invalid. With most insurers, this is 30 days, but many will extend this to up to 3 months if asked, or specialist cover might be required if you’re going to be living away for longer.
- Adding legal cover to your home insurance will also give you peace of mind if you’re even slightly worried that the building firm you’re using might go bust and you must sue to get your money back. Or you could need it if you get into dispute over poor workmanship or contractual agreements (remember that if you pay builders in cash, there won’t be any ‘paper trail’!).
Building or creating a home, either from scratch or as a conversion or renovation project can be one of the most rewarding challenges of your life. The type of project you are embarking on will invariably involve a significant amount of investment, so ensuring you have the correct advice and insurance in place is also essential.
Call the Self-Build Zone Team on 0345 230 9874 or visit: www.selfbuildzone.com .
Reference: Policy Expert