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Home Upgrades And Informing A Home Insurance Company

2010-09-06

For any homeowner, making home upgrades is simply a matter of course. Whether a home is new and an owner simply wants to add a few finishing touches, or if a home is older and needs to have wiring replaced or structural defects corrected, home upgrades can become necessary for any number of reasons. While these upgrades can make a home better and brighter, or correct existing problems, there are situations in which they themselves can become an issue. This is because many Americans do not realize when they should report an upgrade or a series of upgrades to their insurance company and alter the amount of home insurance coverage that they currently have on the home. If an upgrade is not properly reported, an insurance company may have the right to deny all or part of a claim, based on the nature of the upgrade and the damage sustained by the home. Here are a few tips on when to report home upgrades to your insurance company.

First, make sure to report anything that structurally alters a home. This includes a covered deck, garage-add on or finished basement that involves framing, dry walling and plumbing. Also be sure to report to your insurance company if you install something such as a skylight - these require cutting into the structure of the home itself and may pose potential weather problems. A leaky, unreported skylight will not be covered under hone insurance coverage if it was never reported to the company. While these kinds of upgrades often cause an increase to premium payments, it is often worth it for piece of mind, knowing that they are covered in the event of a problem.

Second, make sure to report upgrades that could potentially lower your risk to an insurer, and therefore lower your payments. These are things like the installation of a security system, carbon monoxide detector, or smoke alarm. Upgrades that make a home safer, more efficient or simply better able to withstand an unexpected event - for example large shutters in a windy or hurricane-prone climate - can help to demonstrate to an insurance company that your home will require a lower payout from them should anything happen to it. This in turn can lead to a consistent level of coverage, but with decreasing premium rates.

Additions such as a new doors, window panes or new furniture in a home do not need to be reported, unless the value of the items is such that they should be listed on an insurance policy. For anything structural or safety-related, however, a homeowner would be wise to advise their insurance company of any and all home upgrades.