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Top 3 Big Ticket Home Maintenance Projects and Their Impact on Your Home Insurance

May 5, 2014

Spring is a popular time to begin looking into home maintenance and preparing your house for the years to come. After the winter thaw, it’s a good idea to survey your house for damage and make any repairs as quickly as you can. For larger projects, however, many people think they can turn to insurance. But home insurance plans are not maintenance plans. In fact, home insurance only really works if you have taken measures to ensure your home is properly maintained in the first place.

A well-maintained home is your ticket to discounted home insurance premiums. From upgrading your plumbing to repairing your roof, these maintenance projects can improve the structure and safety, and increase the value, of your home. Insurers want to insure homes that are updated with new systems and properly maintained, and they seek to approve homeowners that take measures to prevent damage. This is less risky for insurers and more rewarding for you. Putting a little work into your home this spring could save you a lot of money down the line. Here are the top three home maintenance projects and how they can affect your home insurance rates.

Upgrading heating, electrical, and plumbing systems

Upgrading your home’s various heating, electrical, and plumbing systems may lower your insurance premiums. Insurance companies view newer systems as less of a risk because they are considered safer and less likely to cause damages. Your provider understands that systems such as furnaces wear out and eventually have to replaced, thus they are not covered under your standard home insurance policy (unless you have bought additional breakdown coverage). Before making any upgrades, talk to your provider about how upgrading your home’s various systems will impact your premiums, and find out which renovations you should consider.

Waterproofing

Most insurance policies do not cover damage from flooding or leaks, which is why many homeowners choose to take measures to prevent problems from occurring. Your insurance provider can be a great source of knowledge when it comes to waterproofing your home. It’s a good idea to talk to them before you have a leak to find out what measures you can take to reduce your home’s susceptibility to water damage and increase your chances of being covered should anything ever happen. Your insurance provider will be able to point you in the direction of appropriate professionals they deem reliable while also providing you with information to help you troubleshoot potential problems before they happen. If you’ve taken measures to prevent water damage, this may help you in the event of a claim.

Roof repair

Your roof has a lot to do with the cost of your home insurance policy. After all, it plays a significant role in protecting your home. If you choose to replace your roof this spring be sure to notify your insurance company, especially if you change the materials of your roof. The strength of the materials, their susceptibility to fire, and their expected lifespan will likely affect your home insurance rates.

It is important to note that general wear and tear is not covered under your insurance. If your roof is damaged in a storm—typically from wind or hail—the damage will likely be covered under your insurance policy. If it turns out your roof suffered damages under the weight of snow, your eligibility for coverage will vary from plan to plan. Some home insurance providers will cover necessary repairs, while others will require you to obtain additional specialty insurance to cover this risk (prior to damage). The insurance company may evaluate this at a depreciated value, factoring in the age and condition of your roof prior to the damage.

Increasing your home’s replacement cost

You pay insurance not on what your house is worth on the market, but on how much it would cost to replace it. Although maintaining your home can prevent damage and save you money in the long run, some projects also increase the cost of rebuilding it. This means these projects could actually cause your insurance premiums to go up. Your roof is a perfect example. A new roof may now be deemed as less of a risk, especially if it is reinforced, but better materials impact the cost assessment of your home.

Talk to your insurance provider before any home maintenance projects to learn how upgrades will impact your insurance rates. It’s possible the discounts you may receive by improving and upgrading your home may balance the increased replacement cost, saving you money down the line.

A home that’s well maintained needs home insurance that’s regularly maintained too. Compare home insurance rates today to make sure you’re getting the best coverage for what you’ve put into your home.