Updating Homeowner’s Insurance Policy Is a Must After Making Renovations

 

According to a recent study around one-third of homeowners did not know that they should update their insurance policy after a renovation. A survey done by The Hanover revealed that 61% of US home insurance policyholders are planning on renovations, but only 34% know to update their homeowners’ insurance coverage once the renovation is complete.

“Proactive outreach throughout the year also results in powerful conversations that give customers peace of mind that their age3nts are continuously looking for ways to protect investments and add value to the relationship,” noted The Hanover report.

Renovations will raise the value of a home, so you might not have enough coverage with your original policy. If you suffer a major loss, this could hurt you and your pocket. Usually when a renovation is completed, there needs to be a modified Coverage A amount listed on the original policy. This is important because it is reported that around forty percent of homeowners will renovate and spend more than $50,000.

Homeowners are staying put in what they have due to higher interest rates and rising home prices. Around 28% of those that planned on purchasing a home in 2022 said that higher interest rates and home prices encouraged them to stay put. Around seventy percent of those who were going to purchase a home said that rising interest rates and home prices affected their decision.

“These trends should prompt agents to talk with their customers to ensure their homeowners’ policies reflect the true value of their home after a renovation, and that their policies protect the investments they have made to their home. These conversations can help create a strong customer experience that reminds customers of the value their agent provides,” says Richard W. Lavey, president of Hanover Agency Markets.

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What Are the Costs of Home Ownership?

 

Purchasing a home is one of life's major events. Many believe it is out of reach financially because of the competitive market and high cost of homes. If you are up for the challenge, homeownership can be both personally rewarding and financially rewarding. There are several long-term financial benefits of owning a home.

There are many concerns when purchasing a home, in fact, a study showed that over half of millennial homeowners have at least one regret about purchasing their home. These regrets included not being happy with their rate, not being prepared for maintenance costs, high monthly payments and high home prices.

This should not detour you from taking on the financial responsibility of homeownership. In order for it to be a confident decision, get the aid of professionals in the industry who can help you fully understand the process and what surprising costs you may occur.

There are a lot of reasons why renting is best for some such as short-term living arrangements, others trying to improve their credit scores, and some people are just not in the financial position to take the plunge into buying a home.

If you can take the plunge then it is wise to do so. When you have to renew a lease, the rent usually increases around 3 - 5% per year. Also, the money you pay for rent goes into someone else's pocket. If you own a home, you are paying into a mortgage on a home and will obtain equity.

Remember even if there are maintenance costs, every dollar you put into your home adds value. In the long run, homeownership is usually less expensive than renting. If you are in the market for a home, contact your local agent who can help you with getting a home for your needs at a great value.

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