Page 27 - Real Estate Now Jan-Feb 2022

• changes or updates to the plumbing or wiring;
• the addition of a fireplace;
• building a new deck or outdoor feature like a pool; or
• adding a home office or workshop for your own business, which could result in needing additional liability
insurance.
Depending on the company, anything that changes the replacement cost of your home could impact your policy, so
it’s important to check with your provider before starting any major renovations. It’s also important to look into home
insurance upgrades when adding a rental space. As a landlord, you’ll have additional responsibilities on top of typical
homeowner duties.

What types of renovations don’t affect your home insurance?
On the other hand, most cosmetic changes won’t result in an impact to your insurance rates or coverage. According
to Sonnet, updating your kitchen counters or cupboards, changing your flooring, renovating the walls to expand a
room, or updating your bathroom are some examples that might not impact your insurance rates or eligibility.
Johnson said, “it’s important to note you should still inform your insurance company of these renovations even if you
think they may not impact your insurance rates/coverage.”
We also spoke to Justin Thouin, co-founder of LowestRates.ca, who said while some aesthetic upgrades may increase
replacement costs throughout your home, other maintenance upgrades are unlikely to have an impact. Thouin says
this includes new paint or other touch ups, like on grout.

When do you need to inform your insurance broker about renovations/potential
renovations to your home?
You should inform your policy provider of any renovations being conducted (or potentially conducted) in your home
before the work actually begins. This will help avoid any problems or increases to your insurance rate, and guarantee
coverage still exists during construction. Depending on the type of renovation, you may also need to consider adding
additional insurance for the duration of the work.

“If you’re doing a major project and you are going to have contractors and builders working on your property, you
may be advised to add temporary liability insurance in the event of a worker injury,” said Thouin.

While the company you hire will have some form of insurance in place, it might not fully cover your responsibilities.

Informing your provider prior to construction beings also helps protect you if anything is damaged during renovations,
like if there was a flood, for example. Your provider will be aware, and your new finishes will be covered. What’s more,
Thouin says if you’re going to be away from your property for 30 days or more, including because of renovations, you
also need to notify your insurer as an extended absence could void your insurance policy.
Be sure to read the fine print of your policy so you can fully understand your coverage. Of course, if you’re unsure, it’s
best to reach out to your provider to discuss your options.

It’s also a good idea to speak with your REALTOR® before starting any major renovations to learn what’s currently
trending in your neighbourhood, potentially earning you a better return on investment. ■

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