Guide to renovation insurance
Buying a run-down property and doing it up can be a cost-effective way of getting your dream home. And buying a smaller home and extending it or converting the loft –can be the only way you can afford to achieve the space you need in an area you like. Every project varies, but as a general rule, most renovation and conversion cases cost more than expected and take longer than anticipated, so be warned!
During the process, it can be very sensible to take out renovation insurance. Standard buildings and contents insurance won’t usually cover a property during renovation, particularly if the property is left unoccupied for more than a month – and, of course, most renovation projects take longer than this.
The exact terms and conditions of the renovation insurance needed will vary. An empty property is vulnerable to vandalism and fire. But even in the face of the standard risks of fire, storm or flood damage, not only the original structure, but all new, renovated work also needs to be covered. On top of that, the owner will need to cover the additional risks associated with the building works themselves.
These will probably involve a higher level of coverage for public liability. To cover the owner’s obligations and responsibilities towards the workers he employs to do the renovations, there will also be a need for employer’s liability cover, not to mention insurance for the materials and equipment on site.
Clearly, the majority of these risks will need to be insured if the owner plans to carry out the renovation works himself. Even if the builder contracted to work on the project has their own insurance – which is usually the case – the owner will still need cover for their own obligations and liabilities during building works, like site safety and security and employers’ liability.
As the exact insurance needed for renovations will vary, it could make sense to consult an insurance broker or adviser to arrange cover. If you are renovating a property to let out you may need landlords insurance cobver, rather than renovation cover, and if you are planning to sell it you might wish to take out unoccupied property insurance instead.