Why do I need home extension insurance?
The importance of home extension insurance
If you’re planning on extending your home, then make sure your project is correctly covered for peace of mind. Did you know that most home insurance policies were not designed to cover your existing property whilst being worked on or the workmen doing the work?
It’s a worrying fact that many homeowners will carry out work to their properties assuming that any work will be covered under their existing home insurance policies. Sadly, in most cases it won’t, and to make things worse, any structural work that you undertake will often invalidate existing homes and contents policies. Most policies allow you to carry out simple internal alterations and refurbishment, but any additional building work must be notified. It is therefore wise to speak to your existing home insurer in the first instance and describe, in detail, the scope of the project.
Most insurers feel better about you using builders under a JCT contract (Joint Contracts Tribunal) – although, given the large number of subtly different JCT contracts, you need to be clear about which one you’re using – but it is down to the individual underwriters to take a view on each case.
For example, a homeowner carrying out a large extension and renovation project who is using a builder/main contractor for some but not all of the project may be required by their home insurer to agree to certain clauses on their policy. These are likely to be that you will not be covered in the event of a flood if the property is at any stage where it is not wind and watertight, and a clause not covering theft of contents in the same instance. The insurer we spoke to about this situation did not require additional policy premiums.
“The key, therefore, is to speak openly and honestly to your existing insurer. They are likely to be reluctant about insuring you if you’re moving out while work continues, and if a lot of the existing house is being demolished in the process. In simple terms, anyone carrying out an extension or major remodelling project without contacting their existing insurer is in breach of their policy and at huge risk”.
If your existing home insurer won’t cover you – particularly if you are planning to take on the builder’s role yourself – then you need to speak to us! We can provide a home improvement policy which will provide cover for all normal builder’s risks, together with public and employers’ liability. The existing building is covered up to 110 per cent of its value and the proposed works, up to 125 per cent of their value or contract price. It is quoted according to the job and the costs of the proposed works.
Don’t forget that your homes and contents policy will need updating once you have completed the work to reflect the additional space and, presumably, rebuild value of the home.