If you are carrying out home renovation or building works, it’s vital to ensure you and your property are fully protected. Although a standard home insurance policy will normally cover redecoration and DIY, it won’t cover problems caused during bigger jobs such as loft conversions or building an extension.
Insurance for building works
Standard home insurance is unlikely to cover major renovation works because building work increases the chances of something going wrong and you needing to make a claim. For example, a wall might collapse, a fire might break out, or building equipment could be stolen. At certain times during the work your home may be structurally unstable, exposed to the elements or more vulnerable to theft.
You’ll normally need a specialist insurance policy if the renovation or building work means your home will not be lived in for more than 30 days. You’ll also need specialist cover if the works are extensive or there will be expensive equipment and materials kept at the property.
Syed Jamal, head of home underwriting at Markerstudy Insurance (opens in new tab), says: ‘It's important to tell your home insurer if you are intending to do building work or renovations to your property, as this increases the risk of something unexpected happening to your home and its contents.
‘Home insurers are likely to take different approaches when this happens and, depending on the extent of works taking place, may impose additional requirements or exclusions to your home insurance policy. To give some more detail, a fairly typical insurer response for properties under the course of construction, or properties unoccupied during completion of minor building works, would be to decline cover on their standard Home Insurance Policy.’
Do I need building works or renovation insurance?
Most insurance for building works will cover some types of minor building or renovation work on a standard home insurance policy. What is covered varies between insurers so it’s a good idea to check your policy – if in doubt, call your insurer.
‘If a customer is looking to get renovation work completed on their property, it’s always advisable to inform their insurer about this, to ensure that the necessary cover is in place,' says a spokesperson for Churchill Insurance (opens in new tab). 'We can offer cover within the policy for the following: new kitchen, new bathroom, new flooring, decorating, and rewiring.'
'A customer should, however, be conscious that when making significant alterations and renovations on their home, there are some considerations to be aware of. These include that when a property becomes unoccupied we may restrict cover, we have time limits on how long the work can take, and security endorsements may be applied.’
According to data analyst Defaqto, about 15% of building insurance policies include a ‘minor building works limit’. This type of cover means you can get work done, up to the value in your policy, without needing extra cover.
‘Many homeowners don’t realise that your house insurance will not cover you for home improvement disasters if the insurance company hasn’t been notified first' warns JJ Heath-Caldwell, managing director at Local Surveyors Direct (opens in new tab). 'If you or a contractor goes ahead and damages your property for the purpose of building works, without telling your insurer, then it could void your policy,'
‘Most insurance companies will cover up to £20,000 to £30,000 worth of building work in your home. But once you go over that figure it becomes a major project and you might find you need to change insurers for the renovation period. It is also important to make sure your trades people or builders have the right insurance cover themselves, so that it’s not your household policy that takes the brunt of any claim.’
Home renovations can be complex projects, and the potential problems might not always be obvious to those not in the building trade. Insurance for building works – or home renovation insurance – will protect your property against a range of risks while building works are being carried out including an unoccupied property pending renovation.
If you’re doing structural work but it’s not a self or new-build project, then it’s likely that you’ll need renovation insurance. This includes work such as conversions (such as barns, basements, and lofts) and extensions. If the property doesn't have anyone living in it for a period of time you may need unoccupied house insurance.
Won’t my builder have insurance?
Although most builders will have insurance for building works carried out on your home – and you should check this before they begin work. Because this might not protect you in all situations. Different contractors will have varying levels of cover, and some policies may come with exclusions.
For example, a builder’s insurance policy may have exclusions and limits which will compromise the safety of your property. Some policies include an ‘application of heat’ exclusion, which means that if a fire were to break out when the builder was using a blowtorch, then the cost to repair this damage to your home would be excluded.
Some policies may have limits about height or depth – these will be relevant if you are adding an extra storey to a property or renovating a basement.
‘Contractors should have public liability insurance' says James Cullen, head of building surveying at property group George F. White (opens in new tab). 'This should be checked by an instructing homeowner to ensure it is valid, does not expire during the job, is assigned to the parties doing the job and is of sufficient value to cover the cost of the works and any consequential damages which could occur as a result of the works.'
'For example, hitting a power supply cable whilst digging foundations, causing death or injury etc.’ If your builder has public liability insurance and a contractor’s or risks policy, you can give their insurance details to your existing home insurance provider, who will be able to check what cover they have and how this applies to your policy.
A spokesperson for Churchill Insurance adds: ‘To be covered for renovation work, the contractor must have public liability insurance and an all-risks policy. We would therefore always advise that customers conduct relevant checks on the suppliers they’re using and review all insurance documentation before entering into a contract. Just to ensure that they’re fully covered for the work that will be completed.’
What does insurance for building works cover?
Policies vary between insurers, but a typical building works or renovation insurance policy might cover:
- Damage to possessions left in your home or in temporary storage
- Public liability cover in case the building work on your home injures a third party
- Alternative accommodation if an issue with building work means your house becomes uninhabitable
- Damage to the existing structure of the property
- Theft of building equipment or materials from the property
- Legal expenses cover
- Personal accident cover if you are injured during the renovation work
- Unoccupied property insurance if you’re not living in the property more than 30 days
- Accidental damage
Do I need to tell my standard home insurance that my home has been renovated?
After your building work is complete it’s a good idea to double check your existing home insurance policy. The premium you paid will be based on the property’s ‘rebuild value’. That is, how much it would cost to completely rebuild the property from scratch.
The rebuild value will be different to your property’s market value. If you’ve had extensive renovations done, you may need to update the rebuild cost of your property to remain adequately insured. Speak to your insurer if the work involved altering the structural layout of your house, extending your property, or any kind of conversion.
The best pillows 2022 – 10 tested choices for every sleep style
Say goodnight to neck pain and poor sleep with these best pillows, tried and tested for the best slumber ever
By Louise Oliphant
Best sofa beds 2022: comfortable, stylish and versatile
The best sofa beds for putting up overnight guests in style; tried and tested for comfort, practicality and affordability
By Amy Lockwood
How to paint bathroom tiles - a guide to upgrade your bathroom on a budget
Want a quick and easy way to revamp your bathroom? A lick of paint over your tiles could be all you need
By Holly Walsh
How to cut the cost of home insurance – without losing cover
Knowing how to cut the cost of home insurance (without compromising your cover) is crucial at a time when prices are rising all around us
By Rachel Lacey
First time buyer schemes to help you get on to the property ladder
We’ve rounded up the first-time buyer schemes you need to know about to get you on the first rung of the property ladder
By Holly Thomas
Unoccupied house insurance - why and when do you need it?
You might need unoccupied house insurance if your property is left empty for a long period of time
By Emma Lunn
Renovation insurance - when do you need it?
Specialist renovation insurance could be a worthwhile investment if you’re having substantial work done on your home
By Rachel Wait
Renovation mortgages: how do they work?
If you’re seeking a lump sum to fund a big property renovation project, you could look at a renovation mortgage.
By Harriet Meyer
What is a mortgage broker and should you use one?
Ever asked yourself ‘what is a mortgage broker?’ We explain how using a mortgage broker could save you time and money when searching the mortgage market
By Christina Hoghton
Early repayment charges: what are they and how can you avoid them?
Here’s everything homeowners need to know about early repayment charges when they are moving mortgage deals.
By Harriet Meyer
Best mortgage rates – how to find the cheapest deals
A mortgage is a serious financial commitment so check out these best mortgage rates first
By Samantha Partington