Does Home Insurance Cover Home Renovations?

Dwelling coverage pays to repair or rebuild your home after events like fire or storms, but homeowners insurance doesn’t cover elective renovations such as remodels, additions or cosmetic upgrades.

Find out if you're overpaying for home insurance below.

Written by Mark Fitzpatrick

Updated: April 7, 2026

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Key Takeaways

Dwelling coverage pays for home renovations (repairs) when a covered peril like fire or a windstorm damages your home, but standard homeowners insurance doesn't pay for elective renovation projects you choose to undertake on your own.

A fire during construction is covered under dwelling coverage, but poor contractor workmanship is not.

Completing a renovation without updating your dwelling coverage limit can leave you underinsured, and you should notify your insurer before starting a major project to avoid a coverage gap.

Does Home Insurance Cover Home Renovations?

Dwelling coverage pays to repair or rebuild your home after a covered peril, such as fire, and those insurer-funded repairs are the renovations home insurance directly covers. If a covered peril damages your home during an elective renovation, dwelling coverage, personal property coverage and liability coverage can still apply to the resulting loss.

However, the cost of elective renovation projects you choose to undertake on your own, including kitchen remodels, room additions or cosmetic upgrades, is not covered.

When Does Homeowners Insurance Cover Home Renovations?

Coverage for home renovations applies only when repairs are needed due to damage from a covered peril, not planned upgrades or improvements.

Repairs After a Covered Loss (Fire, Storm, Fallen Tree)

Dwelling coverage pays to repair or rebuild parts of your home damaged by a covered peril, and those insurer-funded repairs are renovations your policy covers directly. If a tree crashes through your kitchen roof, your policy pays to rebuild the kitchen. If a fire guts a bathroom, dwelling coverage funds the full restoration, including new fixtures, flooring and drywall, up to your policy limit.

Damage to an Elective Renovation From a Covered Peril

Dwelling coverage pays for damage caused by fire, windstorm, hail or lightning that strikes your home or renovation materials while an elective construction project is underway. This applies whether the fire starts from a contractor's equipment or a lightning strike hitting the structure. Your standard deductible applies before the insurer pays the remainder.

Theft, Vandalism or Visitor Injury During Construction

Personal property coverage and dwelling coverage may cover stolen or vandalized construction materials and fixtures already installed in your home. Liability coverage pays medical bills if a non-worker (such as a guest, neighbor or delivery person) is injured on your property during the renovation. Contractor employees should be covered by the contractor's own workers' compensation insurance, not your homeowners policy.

Covered scenarios apply only if your policy includes the relevant coverage type. Standard homeowners policies vary, so check your declarations page to confirm which coverages are active.

When Doesn't Home Insurance Cover Home Renovations?

Home won't cover poor contractor workmanship, flood damage during a renovation or the cost of elective renovation projects you voluntarily choose to undertake. These exclusions apply regardless of when the damage occurs or who performs the work.

Poor Workmanship or Contractor Mistakes

Homeowners insurance doesn't pay to fix shoddy construction, incorrect installations or work that fails to meet quality standards. If a contractor installs plumbing incorrectly, the cost to redo that plumbing isn't covered. If that faulty plumbing causes a burst pipe and water damage to your home, the resulting water damage may qualify as a separate covered peril and be eligible for reimbursement.

Flood or Earthquake Damage During Renovation

Standard homeowners insurance excludes flood and earthquake damage whether or not a renovation is in progress. If a rainstorm floods your open foundation during a remodel, your homeowners policy won't pay for the loss. A separate flood insurance policy through the National Flood Insurance Program (NFIP) or a private insurer is required to cover that risk.

Damage From Normal Wear, Settling or Neglect

Homeowners insurance doesn't cover damage caused by gradual deterioration, structural settling or failure to maintain the property during construction. If a renovation site is left exposed to the elements for months and moisture warps the framing, that loss is classified as a maintenance issue rather than a covered peril and won't be reimbursed.

WHAT YOUR POLICY COVERS VS. WHAT YOUR CONTRACTOR'S POLICY COVERS

If a contractor's actions cause damage (for example, a power tool sparks a fire), your homeowners insurance may cover the resulting damage to your home, but the contractor's general liability insurance should cover the cost of their mistake. Always verify your contractor carries both general liability and workers' compensation insurance before work begins.

How to File a Claim for Home Renovation Damage

Filing a renovation damage claim follows the same process as any homeowners insurance claim, with one additional step: documenting the renovation's status at the time of the loss.

1
Document the Damage and Construction Status
Take photos and video of the damage immediately after the loss. Include shots that show the renovation's progress at the time of the incident (for example, framing complete or drywall installed). Keep all contractor invoices, receipts for materials and your renovation contract on hand to support the claim.
2
Contact Your Insurance Company
Call your insurer's claims line or file through its app or website. State Farm, Allstate and USAA (available to military members and their families) all allow you to start a claim online. Tell the representative that the damage occurred during an active renovation, so the adjuster understands the context before the inspection.
3
Request a Contractor Damage Report
Ask your contractor to provide a written account of what happened and whether their work or equipment contributed to the loss. If the contractor's actions caused the damage, their general liability insurance may need to respond to the claim instead of your homeowners policy.
4
Meet With the Insurance Adjuster
Your insurer will send an adjuster to inspect the damage and assess the claim. Provide the adjuster with your renovation plans, permits, contractor insurance certificates and all documentation gathered in step one. The adjuster will determine what your policy covers and calculate the payout based on those findings.
5
Review Your Settlement and Update Your Policy
Once the claim is settled, confirm the payout reflects the actual cost to repair or restore the renovation work. After repairs are complete, contact your insurer to update your dwelling coverage limit to match the home's new rebuild value.

MONEYGEEK EXPERT TIP

File a renovation damage claim only when the repair cost clearly exceeds your deductible. If a windstorm tears off new siding and the repair estimate is $4,000 with a $1,000 deductible, filing makes sense. If the damage costs $1,200 against a $1,000 deductible, paying out of pocket avoids a claim record that could raise your premium at renewal.

Home Renovation Coverage: Bottom Line

Homeowners insurance covers renovations only when they are repairs tied to damage from covered perils like fire or storms, not planned upgrades or remodels. Coverage can still apply during construction if a covered event damages the home, materials or causes injuries, but exclusions like poor workmanship or flooding remain. Failing to update your dwelling coverage after renovations can leave your home underinsured and create gaps in protection. Notifying your insurer before starting major projects helps ensure proper coverage and avoids claim issues later.

Home Renovation Insurance: FAQ

These FAQs answer common questions about how homeowners insurance applies to home renovations, including coverage limits and key exclusions.

Does homeowners insurance pay for home renovations?

It depends on what's driving the renovation. If a covered peril like fire, a windstorm or a fallen tree damages your home, dwelling coverage pays to repair or rebuild the affected areas, and those repairs are renovations your insurer funds directly. Homeowners insurance does not pay for elective renovation projects you choose to undertake on your own, such as kitchen upgrades, room additions or cosmetic remodels. If a covered peril damages your home during an elective renovation, your policy can still cover the resulting loss. For example, if a fire damages your kitchen while you're remodeling it, your insurer will pay to repair the fire damage but not to complete the elective remodel itself.

Does my deductible change during a renovation?

Your standard deductible still applies to any claim filed under your base homeowners policy. If you add a dwelling under construction endorsement or a separate builder's risk policy, a distinct deductible may apply to that coverage. Review the endorsement terms with your insurer before construction begins to understand what out-of-pocket costs you'd face.

What insurance do I need if I'm doing a major renovation?

For large-scale projects, a builder's risk insurance policy or a dwelling under construction endorsement fills the gaps standard homeowners insurance doesn't cover, including theft of uninstalled materials and damage to construction supplies stored on-site. Your contractor should also carry general liability and workers' compensation insurance before work begins.

Will filing a renovation damage claim raise my premium?

Filing any homeowners insurance claim can affect your premium at renewal. One claim may not cause a large increase, but multiple claims within three to five years can result in higher rates or nonrenewal. Weigh the repair cost against your deductible before deciding whether to file.

Should I update my homeowners insurance before or after a renovation?

Before. Contact your insurer during the planning stage so you can add endorsements for the construction period and adjust your dwelling coverage limit to reflect the home's post-renovation rebuild cost. Waiting until after the renovation is complete can leave you underinsured if a covered loss occurs during construction.

About Mark Fitzpatrick

Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. He has analyzed the insurance market for over five years, conducting original research for insurance shoppers. His insights have been featured in CNBC, NBC News and Mashable.

Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!

He writes about economics and insurance, breaking down complex topics so people know what they're buying.

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