Updating Your Bathroom and Home Insurance Coverage

Updating Your Bathroom and Home Insurance Coverage

Updating your bathroom and insurance


Updating your bathroom is similar to remodeling project in your home: The value added can increase the worth of your property.

Your insurance policy is usually not part of the to-do list when it comes to planning a remodel. QuoteWizard.com recommends that this increase in value is covered by your homeowners insurance if you want to protect your investment from paying out of pocket costs if damages do occur.

This is no difference with a bathroom upgrade. According to HomeAdvisor, the average cost to remodel a bathroom in 2018 is $9616. The typical cost ranges from $5,922 – $13,997 with the low end projects costing $2,500, and the high-end projects costing on average up to $23,292. These are significant costs that need to be covered.

Either you plan on updating your bathroom or just completed the project, there are steps that should be taken care of related to your homeowner’s insurance to help you be fully covered if something terrible does occur. If you put a significant amount of time, energy, and/or cost into your bathroom project, we just assume that you would want to fully protect yourself and your property from the unthinkable.

Like aforementioned, when you update any part of your home, including your bathroom it is more appealing, thus increases its monetary worth. Either it being new countertops, sink, shower, toilet, or anything similar, it all adds value.

You wouldn’t want you newly installed bathtub spewing out water to the point where it causes thousands of dollars in damage and have to pay a hefty penny to fix the damage from out of your pocket. An updated home insurance policy will assure you are covered from the wide range of potential damage and liability that can occur to and in one’s bathroom.

If something does occur to your bathroom, having an updated your home insurance policy will help you increase the chance that your claim will be approved and mitigate any out of pocket costs and hassles getting your claim approved. If you don’t make sure your renovated bathroom is reflected in your homeowner’s insurance, then your insuring company is going to have a much harder time figuring out if you are telling the truth with all the damage that occurred to your bathroom.

The best way to counteract that from happening is to take inventory of your bathroom additions precisely. When you update your bathroom, you are going to want to create an inventory with the dollar value of what you updated so your insuring company knows exactly the costs to replace it. Read more about taking inventory for your homeowner’s insurance claims here if you want additional information.

Updating your bathroom and insurance

There are factors that affect the value of your renovations, and thus your home.

Building Materials

The more expensive the raw materials used when updating your bathroom, the more it would take to replace it if you ever filed a claim. Makes sense that lower quality materials and the difference between higher qualities is usually reflected in the cost to make (high correlation).

The important part of this is your insurer knows and is aware what went into the building and updating of your bathroom. If your contractor used high-quality materials, best you be able to easily prove it.

Square Footage

If you added more space to your house through adding a bathroom, the increase in square footage increases the value of your home, and thus the need to increase your home insurance coverage. It’s important to update your policy to include the new additions. If not, then your home may be insured for less than its market value.

New Household Items

Adding more valuable fixtures and appeal will slightly increase your premiums (what you pay monthly for insurance cost) when updating your bathroom. How you insure those items determines the extent of the increase.

You have 2 options for increasing your coverage to reflect the added value to your home through the bathroom renovation project. One is replacement cost and the other is actual cash value.

Replacement cost would pay out the full and total cost to replace your damaged goods, such as a toilet or a new shower. For example, if you bought a thousand dollar countertop/sink, then you will receive a thousand dollars to replace that with replacement cost. Like mentioned earlier, you are going to want to take photos, and take an inventory of your newly updated bathroom to be fully paid back for what you paid. Essentially it gives you full replacement cost, but with a higher monthly premium. There are many ways an insurer determines you monthly premium costs.

The other option is actual cash value, which takes the current market value of your additions. The reason why it is cheaper is because it takes depreciation into account which lowers the value of your renovations over time. Over time it losses value so if you bought a sink for $600, then you may only be covered up to $400 after 3 years.
Read more about replacement cost or actual cash value options to decide what option you choose.

In all, if you want to feel rest assured that your upcoming or recently finished bathroom renovation is full covered, updating your homeowner’s insurance to reflect the renovations is a smart option. The costs involved in updating your homeowners insurance is usually bare-minimum and more than worth taking the time and effort to reflect it in an updated homeowners insurance policy.


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Nathan Barber About Nathan Barber

Nathan Barber is a Content Specialist of QuoteWizard.com. When he is not adventuring the wilderness with his Husky/Corgi, you can find him on the soccer pitch or writing about insurance-based needs.

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