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One of the major benefits of being a homeowner is being able to customize your home to your liking. Home reno projects make all the difference in transforming your home into a forever home that better suits your family’s needs.

Most renovation projects influence the resale value of your home, and in turn, they can affect your insurance coverage too. You should always communicate home renovation projects to your independent insurance agent so they can adjust your policy as needed to ensure you’re not underinsured.

Some home renovation projects can increase rates, while others can decrease rates, and many involve updating your coverage. Your agent can help you navigate several renovations and how they can influence your home insurance.

Renovations that Can Increase Home Insurance Rates

Major renovations can significantly increase the value of your home. Home insurance protects your property up to a certain limit, or dollar amount. So when the value of your home increases, that property limit will likely need to be increased too. If it’s not, you may not have adequate coverage to mend damages after a loss.

1. Home Additions

Many homeowners opt to expand their home’s square footage before deciding to move on to a larger home. Expanding your home’s square footage by adding on an addition will most likely increase your insurance premium to account for the value of the new space. It’s best to contact your independent agent after any home renovation project to discuss if you need to modify your policy.

2. Building a Swimming Pool

In most locations, adding a pool to your home can increase its value and act as a selling point for future buyers. While your pool is your secret escape, in the world of insurance, a pool significantly increases your liability risk.

From slips and falls to water-related accidents – having a pool present on your insurance policy often comes with the need for increased liability limits, and increased premiums. Some items that affect the premium for your pool include:

  • Diving Boards
  • Slides
  • Locking Fence Surrounds
  • Locking Safety Covers

Liability coverage is designed to help cover medical costs for a person injured on your property and legal expenses if you are sued. While all homeowners policies come standard with this coverage, your agent may recommend higher coverage than the standard limit to make sure you’re properly protected.

Some homeowners might also consider purchasing an umbrella insurance policy, which provides additional liability coverage for greater financial protection.

Renovations that Can Decrease Home Insurance Rates

The good news is some home renovation projects can actually lower your home insurance rates! If you’re making improvements that impact the safety of your home, you could see lower rates after your insurance agent adjusts your insurance policy accordingly.

3. Upgrading Your Roof

Installing a new roof may not be the most welcomed home improvement, but it may save you money on your homeowners insurance. A new roof often means your home is better protected from the elements with new, upgraded materials. The type of roof you choose can make a difference. Some roof types are extremely resistant and last 50+ years, while some may only last 15-20 years.

4. Upgrading Wiring

Some older homes may no longer be up to code and need the appropriate upgrades to ensure the safety of the property. Rewiring your home might be one of the most expensive, but one of the most beneficial, home improvement projects you can do. This is especially true if your home has knob and tube wiring (present in most home built before 1950).

Upgraded electrical wiring lowers the risk of fires and electrical damage. If you undergo an electrical upgrade, you could see a drastic reduction in your insurance premium as your policy presents less risk.  

5. Adding Home Security Systems

Homes could receive a Protective Device Credit if they are equipped with security technology that notifies a central dispatch station, saving policyholders money on home insurance premiums.

Home security technology not only deters thieves from entering your home, but they can also alert the police or a central dispatch team for multiple incidents like burglary and fire. This is a risk management technique that warrants itself on your home insurance policy.


Remember, your home renovation projects are never too miniscule to discuss with your independent insurance agent. It’s crucial to ensure you have adequate coverage for the renovations made to your home should a loss occur.

*Disclaimer: This article is for informational purposes only and does not identify/describe coverage for any individual policy. All policyholders should reference their individual policy for coverage details.

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Amy Casey
Social Media & Communications Specialist
Amy joined Rockford Mutual in January of 2017 with an Associates Degree in Marketing. Amy has a great understanding of insurance in general as she has obtained her Associate in General Insurance designation.