Update Homeowner's Insurance
Vacant homes need different insurance coverage. Standard homeowner's policies often exclude or limit coverage after 30-60 days of vacancy. Notify your insurer before moving out and arrange proper coverage for the construction period - failing to do so could leave you completely unprotected.
Quick Summary
Notice Required
2-4 weeks
Before moving out
Builder's Risk Cost
$1,000-$5,000
For project duration
Vacancy Exclusion
30-60 days
When coverage limits apply
Why Insurance Updates Are Critical
Insurance is about risk - and your home's risk profile changes dramatically during renovation. A vacant construction site faces different hazards than an occupied home: no one to notice a small fire before it spreads, open walls vulnerable to weather, valuable materials attracting theft, and workers creating liability exposure.
Standard homeowner's policies weren't designed for these conditions. Most include vacancy clauses that exclude or severely limit coverage after 30-60 days of vacancy. If you don't address this, you could face a major loss with no coverage - right when you can least afford it.
- Vacancy exclusions: Standard policies often void coverage for vacant homes after 30-60 days
- Construction risks: Open walls, exposed electrical, workers on-site create unique hazards
- Material theft: Construction sites attract thieves; expensive materials need coverage
- Liability exposure: Injuries on your property during construction could create significant liability
- Mortgage requirements: Your lender requires continuous coverage - gaps can trigger force-placed insurance
- Post-renovation value: Your home will be worth more - update coverage to reflect new value
Insurance Coverage Types for Renovation
Homeowner's Policy (Modified)
Your existing policy adjusted for vacancy and construction period.
What It Covers
- • Structure coverage (may be limited during construction)
- • Liability coverage (typically continues)
- • Some personal property if left in home
Note: Most policies have vacancy exclusions after 30-60 days. You may need endorsements or separate policies for full coverage.
Typical Cost: Varies - may increase premiums 25-100% for vacancy period
Vacant Home Insurance
Specialized coverage for unoccupied homes.
What It Covers
- • Fire, lightning, explosion damage
- • Limited vandalism and theft
- • Liability for injuries on property
- • Weather damage (varies by policy)
Note: More limited than standard homeowner's but better than voided policy. Some insurers offer as endorsement to existing policy.
Typical Cost: $1,000-$3,000 per year or 50-100% of standard premium
Builder's Risk Insurance
Coverage specifically for construction projects.
What It Covers
- • Structure during construction
- • Materials and supplies on-site
- • Fixtures and equipment awaiting installation
- • Theft of construction materials
- • Weather damage to open structure
Note: Essential for whole home remodels. Your contractor may include in their coverage or you purchase separately.
Typical Cost: $1,000-$5,000 for project duration (1-2% of construction cost)
Contractor's Insurance
Coverage your contractor should carry.
What It Covers
- • General liability ($1-2M recommended)
- • Workers' compensation (state-mandated)
- • Auto liability for work vehicles
- • Tools and equipment
Note: Verify before signing contract. Get certificates of insurance. Confirm you're listed as additional insured on liability policy.
Typical Cost: Included in contractor's overhead - no direct cost to you
Insurance Update Process
Review Your Current Policy
Before contacting your insurer, understand your current coverage so you can have an informed conversation.
Find Vacancy Clause
Look for "vacancy" or "unoccupied" in your policy. Note the number of days before restrictions apply (typically 30-60) and what coverage is affected.
Check Coverage Limits
Note your current dwelling coverage limit and personal property coverage. You'll need to update these after renovation.
Review Exclusions
Identify what's not covered: construction damage, theft of building materials, vandalism to vacant property.
Contact Your Insurance Company
Call your insurance company (not just your agent) 2-4 weeks before moving out. Document everything discussed.
Topics to Discuss
- Project scope: Describe the renovation - whole home remodel, timeline, whether you'll be living there
- Vacancy dates: When you're moving out and expected move-back date
- Coverage options: What options do they offer for vacant homes under construction?
- Builder's risk: Do they offer it or should you obtain separately?
- Contractor requirements: What insurance do they require from your contractor?
- Premium changes: How will premiums change during and after construction?
Pro Tip: Get everything in writing. After your call, send an email summarizing what was discussed and ask for confirmation. Keep this documentation - it's crucial if you ever need to file a claim.
Obtain Necessary Additional Coverage
Based on your insurer's guidance and your project needs, arrange additional coverage before construction begins.
Vacant Home Endorsement
If your insurer offers this, it modifies your existing policy to cover the vacant period. May be more convenient than separate policy.
Builder's Risk Policy
Covers construction-specific risks. Determine whether your contractor provides this or you need to purchase. Get coverage equal to your total project cost.
Additional Insured Status
Ask to be added as "additional insured" on your contractor's liability policy. This gives you direct coverage under their policy for claims arising from their work.
Verify Contractor Insurance
Your contractor's insurance is your first line of defense against construction-related claims. Verify before work begins.
Required Coverage
- General Liability: $1-2M per occurrence
- Workers' Compensation: State-mandated limits
- Auto Liability: For work vehicles
- Umbrella: Extra protection (recommended)
How to Verify
- • Request Certificate of Insurance (COI)
- • Call insurance company to confirm validity
- • Verify coverage dates span your project
- • Confirm you're listed as additional insured
Pro Tip: Request that your contractor's insurer notify you if the policy is cancelled or not renewed. This is standard practice - just ask for "certificate holder notification."
Insure Your Belongings in Storage
Your belongings in storage need coverage too. Standard homeowner's policies may or may not cover off-site storage.
Check Existing Coverage
Some homeowner's policies cover personal property anywhere (often at 10% of personal property limit). Ask your insurer if storage is covered.
Storage Facility Insurance
Storage facility's insurance covers the building, not your belongings. They may offer tenant insurance for $10-$30/month.
Separate Storage Insurance
If your policy doesn't cover storage adequately, purchase separate coverage. Cost: $50-$150/month depending on value.
Update Coverage After Renovation
After renovation completes, update your policy to reflect your home's new value. Being underinsured after a major renovation is a common and costly mistake.
Dwelling Coverage Increase
Your home's replacement value increased by your renovation cost. Update dwelling coverage accordingly. A $200,000 renovation should increase dwelling coverage by roughly that amount.
Document Improvements
Provide insurer with list of improvements: new kitchen, bathrooms, HVAC, electrical, etc. Include photos and receipts. This documentation is crucial for claims.
Ask About Discounts
Modern electrical, plumbing, roofing, and HVAC may qualify for discounts. Security systems, smoke detectors, and fire sprinklers also reduce premiums.
Post-Renovation Insurance Checklist
- □ Update dwelling coverage to new replacement value
- □ Cancel builder's risk and vacant home coverage
- □ Return to standard homeowner's policy
- □ Document all improvements with photos and receipts
- □ Ask about available discounts for upgrades
- □ Review and update personal property coverage
- □ Update valuable items schedule if applicable
Common Mistakes to Avoid
Not notifying insurer about vacancy and renovation
Consequence: Policy may be voided, claims denied, coverage gaps during vulnerable construction period
Prevention: Contact insurer 2-4 weeks before moving out. Document the conversation. Get coverage confirmation in writing.
Assuming standard homeowner's policy covers vacant homes
Consequence: Most policies exclude or limit coverage after 30-60 days vacancy. Claims denied when you need coverage most.
Prevention: Review your policy's vacancy clause. Obtain vacant home endorsement or separate builder's risk policy.
Not verifying contractor's insurance coverage
Consequence: If contractor is underinsured or uninsured, you may be liable for injuries or damage on your property
Prevention: Request certificates of insurance. Verify general liability ($1M+) and workers' comp. Call insurer to confirm validity.
Failing to insure construction materials and fixtures
Consequence: Theft of expensive materials (appliances, cabinets) not covered. Thousands in losses.
Prevention: Builder's risk policy covers materials on-site. Confirm coverage limits match material values. Consider delivery timing.
Not updating policy after renovation completes
Consequence: Underinsured for new home value. In total loss, payout insufficient to rebuild renovated home.
Prevention: Schedule policy review immediately after completion. Update replacement value to reflect improvements. Document upgrades.
Canceling homeowner's policy during construction
Consequence: Mortgage lender requires coverage. May trigger force-placed insurance at much higher cost.
Prevention: Never cancel existing policy without replacement coverage in place. Coordinate transition with lender.
Frequently Asked Questions
Does homeowner's insurance cover a vacant home?
Standard homeowner's insurance typically does not fully cover vacant homes. Most policies exclude or limit coverage after 30-60 days vacancy. You need to notify your insurer and obtain vacant home coverage or builder's risk policy. Failing to disclose vacancy can void your entire policy.
What is builder's risk insurance?
Builder's risk insurance covers the structure during construction, plus materials, fixtures, and equipment on-site. It protects against fire, theft, vandalism, and weather damage. Your contractor may carry it, or you may need your own policy. Cost: $1,000-$5,000 for typical renovation.
When should I notify my insurance company?
Notify your insurer 2-4 weeks before moving out and before construction begins. This allows time to adjust coverage and obtain additional policies. Some insurers require 30 days notice. Don't wait until after moving out - this creates coverage gaps.
What if I don't report the renovation?
Failing to disclose renovation and vacancy is material misrepresentation. Your insurer could deny claims, cancel your policy, or refuse renewal. They might seek reimbursement after discovering undisclosed renovation. The risk far outweighs any premium savings.
How much will insurance increase after renovation?
Expect 20-50% premium increase for significant renovations due to higher replacement value. However, upgrades to electrical, plumbing, HVAC, and roofing may qualify for discounts. Safety features like smoke detectors and security systems can reduce premiums.