Renovation Insurance: What You Need to Know

Renovations transform homes but introduce significant risks. From accidental damage to theft, injuries, or unexpected problems, things can go wrong during building work—potentially costing tens of thousands of pounds. Proper insurance protection is essential, yet many homeowners don't fully understand what coverage they need or discover gaps in protection only when making claims. This comprehensive guide explains renovation insurance, helping North London homeowners protect themselves, their properties, and their investments during building work.

Why Renovation Insurance Matters

During renovations, your property faces heightened risks: exposed structures are vulnerable to weather damage, building materials and tools attract thieves, construction work increases fire risk, workers or visitors might be injured on site, accidental damage to neighbouring properties can occur, and your existing insurance may not cover renovation-related incidents.

Standard home insurance policies typically exclude or limit coverage during substantial renovation work. Insurers view renovations as significantly increasing risk, particularly for works involving: structural alterations, roof or external wall work, properties left empty or partially occupied, work exceeding certain values (often £50,000-£100,000).

Without appropriate coverage, you could face catastrophic financial losses from relatively common renovation mishaps.

Types of Insurance Coverage

Home Insurance During Renovations

Your existing home insurance may continue during minor works. However, policies typically require notification of: any building work costing over £5,000-£10,000 (varies by insurer), structural alterations, properties becoming empty or partially occupied, roof or external wall work.

Insurers may: continue cover with increased premiums, impose restrictions or exclusions, or decline to continue cover, requiring specialist renovation insurance instead.

Always notify your insurer before work begins. Failure to do so can invalidate policies entirely, leaving you with no coverage at all.

Renovation Insurance (Building Insurance During Works)

Specialist renovation insurance covers properties during major works. It typically includes: buildings insurance covering structure and fixtures, works in progress coverage for materials and labour incorporated into the building, plant and machinery coverage for equipment on site, and often public liability insurance.

Renovation insurance is essential for: extensions, loft conversions, or significant structural work; projects over £50,000-£100,000; properties that will be empty during work; and work lasting more than a few weeks.

Public Liability Insurance

Public liability insurance covers legal liability if third parties (neighbours, visitors, passersby) are injured or their property is damaged due to your renovation. This includes: injuries from falling materials or site hazards, damage to neighbouring properties, legal costs defending claims.

Most reputable builders carry public liability insurance (typically £5-£10 million coverage). However, as the property owner, you may also need coverage, particularly if you're acting as your own project manager or using multiple small contractors.

Employer's Liability Insurance

If you employ anyone directly (even temporarily), employer's liability insurance is legally required. It covers compensation for injuries or illnesses your employees suffer at work. Most homeowners don't need this as their contractors carry it for their own employees. However, if you're directly employing workers, it's mandatory (with few exceptions).

Contract Works Insurance

Contract works insurance (also called construction all-risks insurance) covers work in progress—materials, partially completed work, and site equipment. It protects against: theft of materials or tools, damage to works in progress from weather, fire, or vandalism, and damage to existing structures during work.

This coverage is crucial when spending substantial sums on materials and labour. Without it, you'd need to pay twice if theft or damage occurred before completion.

Who Should Arrange Insurance?

Homeowner's Responsibility

As the property owner, you're ultimately responsible for ensuring adequate insurance exists. Even if your builder carries insurance, you should have your own coverage. Relying solely on contractor insurance is risky—if they're underinsured or their insurance doesn't respond, you face uncovered losses.

Contractor's Insurance

Reputable builders should carry: public liability insurance (minimum £5 million, preferably £10 million), employer's liability insurance (if they have employees), often professional indemnity insurance (for design-build projects), and sometimes contract works insurance (though this is often the homeowner's responsibility).

Always request proof of insurance before work begins. Check policies are current and coverage limits are adequate. Never assume contractors are properly insured—verify it.

What Coverage Do You Need?

For Minor Works (Under £50,000)

For kitchen or bathroom replacements, redecorating, or minor repairs, notify your existing home insurer and confirm coverage continues. Verify your contractor has public liability and employer's liability insurance. Consider whether additional contents coverage is needed if valuables remain on site.

For Major Renovations (£50,000-£100,000+)

For extensions, loft conversions, or significant structural work, arrange specialist renovation insurance, ensure adequate public liability coverage, consider contract works insurance if not included in renovation policy, maintain contents insurance if you remain in occupation, and verify all contractors carry appropriate insurance.

For Complete Refurbishments

If you're vacating during work: cancel your standard home insurance (it won't cover empty properties undergoing work), arrange comprehensive renovation insurance including empty property coverage, ensure contract works insurance covers all materials and works, arrange public liability coverage, and consider separate contents insurance if any belongings remain in the property.

Costs of Renovation Insurance

Renovation insurance costs vary based on: property value and location, renovation scope and budget, duration of works, property occupation status (occupied vs empty), and your claims history.

Typical costs: Notifying existing insurers of minor works might increase premiums by £50-£200. Specialist renovation insurance for £100,000 extension project typically costs £500-£1,500 depending on circumstances. Empty property renovation insurance is more expensive, often £1,000-£3,000+ for six months of major works.

Whilst potentially expensive, renovation insurance is essential. Uninsured losses from even single incidents can dwarf insurance costs.

Key Coverage Considerations

Sum Insured

Ensure buildings sum insured reflects the property's rebuild cost plus renovation costs. As work progresses, property value increases. Update sums insured accordingly or choose policies that automatically adjust coverage.

Contract Works Coverage Limits

If you're spending £100,000 on renovation, ensure contract works insurance covers at least this amount. Underinsurance means you'd only receive partial payment for total losses.

Excess Amounts

Check policy excesses (the amount you pay towards claims). Renovation policies often have higher excesses than standard home insurance. Understand what you'd pay out-of-pocket for various claims.

Exclusions

Read policy exclusions carefully. Common exclusions include: poor workmanship (though resulting damage may be covered), mechanical or electrical breakdown, wear and tear, gradual deterioration, and existing defects.

Empty Property Considerations

Properties empty for over 30-60 days (varies by insurer) are considered high risk. Standard home insurance typically doesn't cover empty properties. If vacating during renovations, arrange: specialist empty property insurance, ensure regular property inspections (many policies require weekly visits), maintain security (secure doors/windows, consider alarms), and turn off water and drain systems (or ensure adequate heating prevents freezing).

Empty property insurance is expensive but essential. Insurers view empty properties as high risk for vandalism, theft, and undetected problems like leaks or fire.

Common Claims and How to Avoid Them

Theft

Construction sites attract thieves. Tools, materials, and copper piping are common targets. Minimise risk by: securing sites overnight (lock doors/windows, consider site alarms), removing valuable tools daily where practical, marking tools and materials, maintaining good site security, and installing temporary fencing for major projects.

Fire

Building work increases fire risk from hot works (welding, torch work), electrical issues, heating equipment, and accumulated debris. Prevention includes: careful hot work practices with fire extinguishers available, regular debris removal, safe storage of flammable materials, and ensuring electrical work is done properly.

Weather Damage

Exposed structures during renovation are vulnerable to weather. Protect by: covering exposed areas with tarpaulins, completing weatherproofing promptly, checking weather forecasts and securing sites before storms, and ensuring temporary weather protection is adequate.

Accidental Damage

Mistakes happen—walls knocked in wrong places, pipes accidentally cut, neighbouring properties damaged. Minimise risk by: using experienced, careful contractors, clearly marking areas and services, conducting regular site inspections, and maintaining good communication about what's being done where.

Making Claims

If problems occur: notify your insurer immediately (most policies require prompt notification), document damage thoroughly with photographs and videos, don't start repairs without insurer approval (unless emergency repairs are necessary), keep all receipts for emergency repairs or temporary accommodation, cooperate fully with insurer investigations and assessors, and be honest and accurate—insurance fraud is a serious crime.

Special Situations

Listed Buildings and Conservation Areas

Inform insurers if your property is listed or in a conservation area. This affects replacement costs (must use appropriate materials and methods) and may require specialist policies.

Self-Build or Major Extensions

For very substantial projects, self-build insurance may be more appropriate than standard renovation insurance. These policies are designed for new construction and major projects, often providing more comprehensive coverage.

If You're Living Elsewhere During Work

Arrange separate insurance for your temporary accommodation if needed (often covered by home insurance "alternative accommodation" benefits, but check limits and whether they apply to planned renovations).

When Work Completes

Once renovations finish: notify your insurer that work is complete, provide any required completion certificates (Building Control, Gas Safe, electrical certificates), update your sum insured to reflect the property's increased value, consider whether you need additional coverage for new valuables (fitted kitchens, bathrooms, etc.), and arrange for standard home insurance if you had specialist renovation insurance.

Choosing Insurance Providers

Select insurers offering: experience with renovation projects, clear policy terms without hidden exclusions, responsive claims handling (check reviews), competitive pricing, and appropriate coverage levels.

Specialist renovation insurance providers often offer better terms than trying to extend standard home insurance. Insurance brokers specialising in property renovation can be valuable, accessing multiple insurers and advising on appropriate coverage.

Legal Requirements

Certain insurance is legally required: employer's liability if you directly employ workers, and adequate buildings insurance if you have a mortgage (lenders require this and may impose their own insurance if you fail to maintain it).

Whilst public liability isn't legally required for homeowners, it's essential protection. Legal liability for injuries or damage can result in six-figure claims.

Final Tips

Notify insurers early in planning—don't wait until work starts. Read policies carefully before purchasing—understand what is and isn't covered. Keep insurers updated about changes in project scope, duration, or circumstances. Maintain good security throughout projects. Don't allow coverage to lapse—even brief gaps can be catastrophic if incidents occur. And keep all insurance documents, certificates, and correspondence safely accessible.