Renovating a property can be a significant project, whether you are updating a rental property between tenants, modernising a recently purchased house, or carrying out more extensive improvements before letting it out. During this period, however, the property may not have the same level of risk as an occupied home.
Building work can leave parts of a property exposed, introduce additional hazards, and mean that the building is empty for extended periods. This can affect the type of insurance you need and the conditions attached to your cover.
So, can you insure a property while it is being renovated? Yes, but the appropriate cover will depend on the property, the work being carried out, and whether the property is occupied.
Does Standard Property Insurance Cover Renovation Work?
A standard buildings or landlord insurance policy may not automatically cover substantial renovation work. Routine maintenance and minor improvements may be treated differently from major structural alterations. Work such as decorating, replacing flooring, or updating fixtures may present a different level of risk from removing walls, altering the roof, rewiring the property, or carrying out significant plumbing work.
It is therefore important to tell your insurer or broker about planned renovation work rather than assuming your existing policy will continue unchanged. The insurer may need details of the work, who is carrying it out, and whether the property will remain occupied during the project.
What If the Property Is Empty During the Renovation?
Many renovation projects involve an unoccupied property. This can happen when a landlord is refurbishing a rental property between tenants or when a buyer purchases a property that requires work before it can be occupied.
An empty property can present additional risks. There may be nobody there to notice a leaking pipe, a security problem, or another issue quickly. Building materials and tools may also be stored on site, while parts of the property may be opened up during the work.
Insurance policies can have specific conditions relating to unoccupied properties. These may include requirements concerning inspections, security, heating, and water supplies. The length of time the property is expected to remain empty can also be relevant, so it is important to discuss the circumstances with your insurer before the renovation begins.
What Types of Renovation Can Affect Insurance?
Not every renovation creates the same insurance risk. A cosmetic refurbishment involving painting, flooring, and replacing kitchen units is generally very different from a project involving structural changes or major building work.
You should consider speaking to your insurer or broker before work begins if your renovation involves things such as:
- Structural alterations
- Removing or altering walls
- Extensions
- Roof work
- Major plumbing or electrical work
- Significant changes to the layout
- Installing new heating systems
- Substantial refurbishment of an empty property
The more extensive the project, the more important it is to make sure the insurance reflects what is actually happening at the property.
Does Renovation Affect Landlord Insurance?
If the property is normally rented out, its status can change during a renovation. For example, a landlord may have a tenant move out before starting a refurbishment. The property could then remain empty while contractors complete the work, before a new tenant moves in. The insurer needs to know about this change because the property is no longer being occupied in the same way as when the policy was arranged.
Once the renovation is complete and the property is ready to let, the insurance requirements may change again. The insurer should be told when the work has finished and when the property is occupied by tenants. Keeping the policy details up to date throughout the project can help avoid problems if you need to make a claim.
What About Contractors Carrying Out the Work?
The people carrying out renovation work can introduce another area of risk. A contractor working at the property could accidentally cause damage to the building or damage someone else’s property. There could also be an accident involving a worker or another third party.
Before work begins, it is sensible to establish who is responsible for the different risks associated with the project. Contractors should have appropriate insurance for the work they undertake, while the property owner should make sure their own insurance arrangements remain suitable. If you are employing tradespeople directly rather than using a contractor, there may be additional responsibilities to consider.
What Happens If the Property Is Damaged During Renovation?
Renovation can increase the potential for certain incidents. For example, plumbing work could result in an escape of water, electrical work could contribute to a fire, or building work could leave part of the property vulnerable to weather damage.
Whether a particular incident is covered will depend on the policy terms, the type of work being undertaken, and the circumstances surrounding the damage.
This is why arranging suitable insurance before work starts is preferable to discovering after an incident that the existing policy does not provide the cover you expected.
Should You Arrange Insurance Before Buying a Property to Renovate?
If you are buying a property specifically because you intend to renovate it, insurance should be considered from the point at which you become responsible for the property.
The property may be empty from the day you complete the purchase. Renovation may not start immediately, particularly if you are waiting for planning permission, contractors, or materials. This means there can be a period when you own the property, but no work is taking place. It still needs appropriate insurance during this time.
Once the renovation begins, the insurer should be informed if the nature of the risk changes.
How Can You Make Sure the Property Is Properly Insured?
The most important step is to explain the project clearly when arranging or reviewing your insurance.
Provide information about:
- The type of property
- Whether it will be occupied
- How long it is expected to be empty
- The type and scale of renovation
- Whether structural work is involved
- Who will carry out the work
- The estimated value of the property and renovation
- When the work is expected to start and finish
If the project changes significantly, your insurer or broker should be kept informed.
Get the Right Insurance Before Renovation Begins
Renovating a property does not mean it has to be left without insurance. However, the cover that was suitable when the property was occupied may not necessarily be appropriate once the property becomes empty and building work begins.
Whether you are refurbishing a rental property, renovating a newly purchased home, or carrying out more substantial improvements, it is worth discussing the project with us before work starts.
At Ashburnham Insurance, we can help you consider the insurance requirements for your unoccupied property and the circumstances surrounding the renovation. Contact our team on 0800 1696137 to discuss your requirements and find out what options may be available.