Do Home Renovations Impact Your Home Insurance Costs?

Home renovation projects improve your home’s aesthetics, functionality, and value. Most homeowners focus on specific factors, especially the cost, comfort, and time taken to complete the renovation project. While these are important considerations, you shouldn’t overlook how your intended renovation project will affect home insurance costs. Typically, renovation projects can increase or decrease your homeowner’s insurance quote depending on various factors.

Home Insurance Costs

Which Renovation Projects Increase Home Insurance Costs?

The following renovation projects can increase your home insurance rates:

●       Home Additions

Property extensions and renovations that add square footage to your home increase property value and insurance premiums. Properties with more square footage typically cost more to repair or rebuild after a disaster. New structures also present different vulnerabilities, such as risky structural integrity, which increases property risks. Insurance companies consider these factors when determining insurance rates.

●       Swimming Pool and Hot tub Additions

A swimming pool and hot tub are certainly attractive home additions that every homeowner desires. Unfortunately, they increase your home’s liability risk. Injuries that can occur in the pool and accidental drownings often lead to costly lawsuits and high insurance payouts. As such, homeowner’s insurance companies charge higher premiums for homes with swimming pools and hot tubs.

●       Home Office Conversion

With remote and hybrid work becoming a norm, most homeowners have converted one of their extra rooms into a home office. While this is very practical, especially for homeowners who work from home, it affects insurance rates. Home offices and home-based workshops require additional coverage for business-related equipment. Your home insurer will also adjust rates in anticipation of liabilities arising from employees or clients who visit the home office.

●       High-End Renovations

You should also avoid high-end renovations if you want to maintain your insurance premiums. High-end bathroom and kitchen upgrades or custom installations significantly increase insurance costs. Like home extension and pool/tub additions, high-end renovations increase the value of your home, consequently increasing the coverage required in case of loss.

Which Renovation Projects Lower Home Insurance Costs?

Roofing and Plumbing Upgrades

You should consider these renovations that lower home insurance rates:

●       Roofing and Plumbing Upgrades

Making roof and plumbing upgrades can significantly lower your insurance premiums. These renovations improve your home’s ability to withstand harsh weather events and reduce the risk of filing water damage claims. New roofs can withstand strong winds, rainstorms, and hail, attracting lower insurance premiums.

●       Energy-efficient Upgrades

You’ll also be surprised at how making energy-efficient home renovations can lower your insurance premiums. Upgrading your windows, installing solar panels, and switching to LED lights can reduce your premiums. Insurers consider energy-efficient home upgrades less risky.

●       Security Improvements

Upgrading your home’s security systems also attracts low insurance premiums. Installing surveillance cameras, smart lights, security alarms, and monitored security systems make your property safe. These installations deter burglars and make it easy to stop or identify thieves.


Most homeowners overlook, but making upgrades affect home insurance costs. While some increase insurance premiums, others reduce risks, lowering insurance rates. Homeowners should discuss renovation plans with their insurer before planning a home renovation project.

Leave a Comment