Home renovations are a great way to improve comfort, boost resale value, and modernize your living space. Whether you’re replacing your kitchen countertops or building a full addition, renovations can also affect something many homeowners overlook—your Salt Lake City insurance rates.
When your property changes, your insurance policy may need to change with it. Renovations can increase your home’s replacement cost, alter its risk profile, and even affect your liability exposure.
Failing to update your insurer could leave you underinsured or paying out of pocket in the event of a claim.
Which Renovations Can Increase Your Premium?
Certain upgrades naturally raise the value of your home, which increases the amount of coverage needed and can lead to higher premiums.
Here are a few common examples:
- Home Additions: Expanding square footage means your home is worth more and will cost more to rebuild. This includes finishing a basement, adding a sunroom, or building a second story.
- Luxury Upgrades: Installing high-end kitchen appliances, custom cabinetry, granite countertops, or spa-like bathrooms increases both the cost of repairs and replacement value.
- Swimming Pools and Hot Tubs: These can increase your liability risk and may require extra coverage, especially if you don’t install required safety features like gates or pool covers. (By the way, did you know between 2017 and 2024, the number of listings of Utah homes with swimming pools doubled?)
- Home Offices or Business Use: Running a business from home, such as daycare or hairstyling, may increase risk and require a commercial rider.
These changes often mean your insurer will need to re-evaluate your policy limits and risk profile, which could increase your premium.
Renovations That May Reduce Your Premium
It’s not all bad news—there are also some renovations that could lower your Salt Lake City home insurance premium.
Some updates improve your home’s safety, making it less likely you’ll file a claim.
Insurers often reward these upgrades with discounts:
- New Roof: A new roof lowers the risk of water damage and claims related to wind or hail.
- Updated Electrical Systems: Old wiring is a common fire hazard. Replacing it can result in lower premiums.
- Modern Plumbing: Outdated pipes are prone to leaks and burst during winter. New plumbing reduces this risk.
- Security Systems: Burglar alarms, smart locks, security cameras, and monitored systems help deter theft and often qualify for discounts.
- Fire Suppression Systems: Smoke detectors, sprinkler systems, and fire-resistant materials can also reduce your insurance costs.
Why You Should Always Notify Your Insurer
Even if your renovation doesn’t seem major, your insurer needs to know. Waiting until renewal time could put you at risk of being underinsured. If a claim is filed before your insurer is made aware of the changes, you might not receive full compensation, or any compensation at all.
Also, if you’re hiring contractors, check if they’re insured and ask your provider whether you need a builder’s risk policy to protect against damage during construction.
Final Thoughts
Home renovations offer tremendous rewards, but they also come with financial responsibilities beyond the construction costs.
Before starting a project, speak with your insurance provider at ASA Insurance to understand how your premium may change and whether additional coverage is needed. That way, you’re protected from both unexpected accidents and insurance gaps once the work is done.
Call today—we’re here to help!
