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 22, 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?

Poor contractor workmanship, flood damage during a renovation and elective remodel costs are all excluded, regardless of when the damage occurs or who does 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
Photograph and video the damage right away, including shots showing the renovation's progress at the time of the incident, such as framing complete, drywall installed and so on. Gather contractor invoices, material receipts and your renovation contract before you call.
2
Call Your Insurer
Report the damage by phone, app or online. State Farm, Allstate and USAA (available to military members and their families) all accept claims online. Tell the representative the damage happened during an active renovation, so the adjuster arrives with the right context.
3
Get a Written Damage Report From Your Contractor
Ask your contractor for a written account of what happened and whether their work or equipment played a role. If the contractor caused the damage, their general liability policy may need to respond instead of your homeowners policy.
4
Meet With the Insurance Adjuster
Hand the adjuster your renovation plans, permits, contractor insurance certificates and everything from step one. They'll confirm what your policy covers and calculate the payout from there.
5
Review the Settlement and Update Your Coverage
Check that the payout reflects the actual repair cost. Once the work's done, call 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 renovation-related damage only when a covered peril like fire or a storm is the cause. Planned upgrades and remodels aren't covered.

A covered event during construction can still trigger a payout for damage to the home or materials, but workmanship failures and flooding stay excluded. Skip the coverage update after a renovation and you risk being underinsured.

Call your insurer before major projects start to confirm your coverage holds.

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?

Large-scale projects need a builder's risk insurance policy or a dwelling under construction endorsement to cover what a standard policy won't: theft of uninstalled materials and damage to supplies stored on-site.

Your contractor also needs general liability and workers' compensation coverage in place before work starts.

Will filing a renovation damage claim raise my premium?

Any claim can affect your renewal premium. One claim may not move the needle much, but two or more within three to five years can push rates up or trigger nonrenewal. Compare the repair cost to your deductible before you 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 (P&C) Insurance Producer in Connecticut, is MoneyGeek's resident insurance expert. He has spent nearly a decade analyzing the market, first at LendingTree and now at MoneyGeek, where he has produced original research on hundreds of carriers and millions of rates across auto, home, renters, health and life insurance.

He writes about economics and insurance on MoneyGeek so people can make coverage decisions with confidence. His insurance insights have been featured in The Washington Post, The New York Times and NPR, among other media outlets.

Like all MoneyGeek analysts, he draws on independent cost and consumer experience data, and no insurance company partnership influences his recommendations.

Fitzpatrick earned his degrees from Johns Hopkins University (M.A. Economics and International Relations) and Boston College (B.A.). He began his career in financial risk management at State Street. He's also a five-time Jeopardy champion!

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