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Could home improvements leave you underinsured?

Director Shaun Lenton explores the potential impact home improvements could have on your insurance. 

Having spent more time at home during the pandemic, you may have been left wondering whether your current setup is right for your needs – and whether you have the space you want for the long term.

While moving to a bigger house is an obvious option, you may prefer to make changes to your current living space instead. After all, if you’re staying at home more, you may have the time and a bit of extra cash to do it.

If you’re planning a significant development, or a new kitchen or bathroom, however, it’s important to speak to your insurance broker. These improvements not only add to the potential resale value of your property, but they’re also likely to add to the rebuild value, which could leave you underinsured, as I’ll explain below. 

Extensions & Loft Conversions

These are the most effective ways of adding space to your home, giving you the extra rooms you need for living and working under one roof. 

Of course, the cost varies depending on what you have done but a full loft conversion typically costs in excess of £25,000. Extensions are often much more, especially if they have two stories. 

This cost needs to be added to the rebuild value of your home. If it’s not and you need to rebuild your home for some insured reason, your insurer would only pay out up to the rebuild value stated in your policy. This could mean you are unable to cover the cost of rebuilding your extension or conversion.

Renovation & Replacement

Instead of creating extra rooms, you may want to change the existing layout of your home or add a new kitchen or bathroom, so you can enjoy the space you have a bit more. 

While the cost may not be as high as adding an extension, a kitchen makeover can cost between £5,000 and £30,000. This must be taken into account when insuring your home. 

Garden Buildings

If you’re working from home full time, you may decide that you want a short commute to work every day. By building a garden room, you could do just that, enjoying a quick walk to your garden before starting work!

Given the capacity for separating work and leisure time, it’s little wonder this idea caught on in 2020. In fact, it became so popular that it gave rise to the word ‘shoffice’ – shorthand for ‘shed office’!

If you’re considering this option, the extra space could range from £5,000 for the most simple to £25,000 for something more elaborate.  

If you’re considering improvements beyond a simple lick of paint, remember to speak to your insurance broker. They can advise on the best way to protect your investment, so your home isn’t underinsured. 

Speak to the One Broker Home Insurance team to discuss your project today. 

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