Thinking about refreshing your kitchen, building an addition, or finally finishing that basement? You’re not alone—almost half of Canadians were planning or completing home renovations in 2024*. With rising material and labour costs, the average renovation now costs around $19,000—almost double what it was just five years ago.
Renovating can absolutely improve your space and increase your home’s value—but it also comes with some serious insurance considerations many homeowners overlook. Before the first hammer swings, make sure you’re protected.
Is Your Renovation Covered by Insurance?
It’s easy to assume your existing home insurance policy will cover you through a renovation, but that’s not always true. Depending on the type of work being done, you may need to update your coverage—or risk being underinsured.
Here’s how a reno might affect your policy:
- Coverage Gaps: Big upgrades or structural changes might not be fully covered by your current plan.
- Higher Rebuilding Costs: Renovations can increase your home’s value, which means your policy’s replacement cost should be adjusted.
- Contractor Risks: If your contractor isn’t properly insured, you could be on the hook for accidents or damages.
- Vacancy Clauses: Moving out for more than 30 days? You may need a vacancy permit to maintain coverage while the home is unoccupied.
Your Renovation Insurance Checklist
Before starting any work, take these important insurance steps:
Tell Your Insurance Broker
Let us know what you’re planning before you start. We’ll help determine whether your current policy covers the project or if you need additional protection.
Consider Builder’s Risk Insurance
If you’re tackling a major renovation (like an addition or full gut job), builder’s risk insurance may be a smart temporary option. It covers damage to materials, theft, and on-site incidents during construction.
Check Your Contractor’s Insurance
Always hire contractors with liability insurance and workers’ compensation. Ask for proof. If they aren’t covered, any accident on your property could become your responsibility.
Update Your Home’s Replacement Value
After the dust settles, your newly improved home could be worth more to rebuild. Make sure your policy reflects that, or you could be underinsured.
Add Coverage for High-End Upgrades
Upgrading to a luxury kitchen or installing custom features? Standard policies may not fully cover high-value finishes. We can help add the right coverage for these investments.
5 Smart Tips for a Safer Renovation
- Hire Reputable, Insured Contractors
Check reviews, verify licenses, and ask for insurance documentation. - Secure Your Home During Construction
Use motion lights, fencing, and cameras to deter theft or vandalism. - Practice Fire Safety
Have fire extinguishers on hand, especially if work involves open flames or electrical updates. - Protect Your Valuables
Store important items and documents away from the construction zone. - Review Your Insurance at Every Step
Talk to your McLean & Dickey broker before you start and once the project is complete. We’ll help make sure you have the right coverage at every stage.
*Source: CIBC.ca.
This article is provided courtesy of The Canadian Broker Network
