Renovating your home can increase your enjoyment of it, while also boosting its market value. However, improvement projects often have impacts on home insurance premiums, with varying results. To help you prepare for a project, this guide explains the effects of certain renovations and what you can do to reduce your premiums.

How Home Insurance Rates Are Calculated

Several factors influence your insurance costs. The age of your house, the materials it’s made of, its square footage, and your neighborhood will all be considered by your provider. These factors affect the risks you and your home face. For example, a house in a neighborhood with a high crime rate may be more expensive to insure due to a higher risk of claims.

Renovations can also affect the square footage and safety of your home. That’s why it’s crucial to discuss any projects with your insurer if you want to know whether your premiums will be affected. If you make a renovation and fail to update your policy, any subsequent claims may be denied.

How Different Projects Affect Rates

Not all renovations cause rate increases. In fact, a few can make your premiums more affordable. Here are a few common projects and their impacts on insurance:

• Room Additions: Larger homes are more expensive to insure because total replacement costs go up. As a result, adding onto the square footage will most likely increase your insurance premiums. You can work to reduce them by installing security systems.
• Swimming Pool Installation: Swimming pools are known as attractive nuisances, meaning they may be interesting to neighborhood children. This increases your liability risk. Pool fences and alarms are usually required. Contact your agent to discuss your options. 
• New Roofing Installation: Replacing an older roof can help decrease the level of risk your home faces. A new roof helps prevent leaks and water damage, reducing the risk of costly claims.

If you’re seeking a home insurance provider, Flathead Farm Mutual Insurance Company goes above and beyond. They serve all of Montana, including Northwest and Central Montana. You can choose from a range of products, which are both comprehensive and affordable. Learn more about their coverage options online or call (406) 752-7500 to schedule a consultation.