Upgrading Your Home? Your House Insurance May Need An Update

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23 Jan Upgrading Your Home? Your House Insurance May Need An Update

Improvements and enhancements to your home can improve its overall value, but it’s important to recognise the impact these updates could have on your house insurance policy. Whether you’re adding a minor dwelling, building a swimming pool, adding a deck, installing a security system or upgrading the plumbing and wiring, find out how house insurance coverage and NZ insurance premiums are impacted and ensure your home is adequately protected.

Adding a minor dwelling

Building a minor dwelling on your property, such as a granny flat or an accessory dwelling unit (ADU) – a small, self-contained residential unit – could add value to your property and provide additional living space for family members or tenants. While this type of structure may improve your overall net worth and provide a valuable source of rental income, it is crucial to obtain the required consent before you start building, which could involve securing a resource consent and a building consent. Additionally, it’s essential you inform your insurance provider about this addition to your home.

Failing to add a minor dwelling to your house insurance policy could leave your new space underinsured or not covered at all. To ensure both your home and the minor dwelling are adequately covered in the event of an insurance claim, contact your Insurance Adviser or insurance provider to update your insurance policy and include coverage for the additional dwelling.

Building a swimming pool

A swimming pool can be a valuable addition to your home, enhancing your lifestyle and improving the value of your property. However, adding a swimming pool to your home also introduces new risks, as it’s not uncommon for accidents and injuries to occur in and around a swimming pool. Some insurance providers view swimming pools as a liability risk and charge higher insurance premiums to cover this additional risk. Before installing a swimming pool on your property, consult with an experienced Insurance Adviser, like those at Max Insurances, to find out about any necessary adjustments to your house insurance policy, such as increasing liability coverage to protect against potential accidents or injuries.

Adding a deck

Decks enhance outdoor living spaces, maximise entertaining areas, and add to your home’s overall appeal. But adding a deck could alter the replacement cost of your home, which would impact your house insurance coverage and your insurance premiums. Let your Insurance Adviser or insurance provider know about any proposed plans to add a deck and find out if you need to adjust your house insurance policy to cover the increased value. That way your house insurance accurately reflects the current state and value of your home, so you won’t be left underinsured should you need to make a claim.

Adding a security system

Installing a security system can reduce the risk of theft and damage to your property, and many insurance providers offer discounts on premiums for homes fitted with security systems. Let your Insurance Adviser or insurance provider know about the security system installation so they can assess whether you qualify for any discounts or if adjustments are needed to reflect the improved security measures in your house insurance policy.

Upgrading plumbing and wiring systems

Many older homes in New Zealand are fitted with outdated pipe materials such as polybutylene, galvanised steel, or lead which are considered a health hazard and high risk for water damage. Similarly, homes fitted with knob and tube wiring systems, which are not designed to handle the demands of modern appliances, are considered potential fire hazards.

Upgrading your home’s plumbing and wiring systems using modern materials reduces the risk of water damage and electrical fires, which in turn could reduce your house insurance premium. Let your Insurance Adviser or insurance provider know about any upgrades to the plumbing and wiring systems in your home, to determine whether the improvements warrant any adjustments to your policy or if you qualify for discounts because of the reduced risk of potential claims.

Keeping your insurance provider informed

Home upgrades, improvements and enhancements can add value to your home and improve your lifestyle, but it’s important these updates are included in your house insurance policy. Keep your insurance provider informed about any changes to your home to ensure that your house insurance policy is up to date and covers the additional features of your upgraded home. For insurance advice or expert guidance finding the right NZ insurance cover to fit your needs, contact Max Insurances to speak to one of our team of Insurance Advisers.

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