Before You Renovate, Put Insurance on the Project Checklist

Mercury Insurance explains why homeowners should consider their coverage before, during and after a major remodeling project

LOS ANGELES, Sept. 22, 2026 /PRNewswire/ -- Homeowners planning a remodel typically make lists for contractors, budgets, permits and materials, but Mercury Insurance (NYSE/NYSE TX: MCY)) says another conversation belongs near the beginning of the project: homeowners insurance. Major renovations can change a home's physical characteristics, replacement cost or liability exposure, making it important to keep insurance coverage aligned as the property changes.

Americans continue to invest heavily in their homes. The Harvard Joint Center for Housing Studies projects annual spending on homeowner improvements and maintenance will reach approximately $518 billion by the end of 2026. With hundreds of billions of dollars going into renovations and repairs, Mercury recommends homeowners make insurance part of the project planning process rather than waiting until the work is complete.

"Homeowners spend a lot of time choosing contractors, finishes and materials, but insurance belongs on that planning checklist, too," said Adam Bakonis, Director, Homeowner Product Management at Mercury Insurance. "A major renovation can change the physical characteristics, replacement cost or even the way a home is used. Talking with your insurance agent before the project begins and after it is completed can help make sure the policy continues to reflect the home you actually have."

Mercury recommends homeowners consider these insurance checkpoints when planning a major renovation:

Before you sign the contract. Talk with your insurance agent about the scope of the project, particularly if it involves adding square footage, structural changes, high-value materials or new features such as a pool, spa or accessory dwelling unit. Understanding potential insurance considerations early can help homeowners address coverage questions before construction is underway.

Before construction begins. Homeowners should confirm that contractors are properly licensed where required and carry appropriate insurance. Ask for proof of applicable liability and workers' compensation coverage and find out whether subcontractors will be used. A contractor's insurance and a homeowners policy serve different purposes, so homeowners should understand where responsibilities lie before work starts.

When the project changes. Renovations don't always follow the original plan. A simple kitchen update can become a larger remodel, an unfinished area can become living space, or an outdoor project can expand significantly. When the scope changes materially, homeowners should consider updating their insurance agent rather than waiting for the project to end.

When you're investing in higher-end materials. A renovation's insurance implications aren't necessarily about how much it adds to a home's resale value. Custom cabinetry, upgraded flooring, built-in appliances, premium fixtures and other improvements can affect what it would cost to repair or rebuild the home following a covered loss. That makes replacement cost an important part of the insurance conversation.

When you're adding new features or systems. Pools and spas can introduce additional liability considerations, while additions and ADUs can change a home's size and use. New roofs, electrical systems, plumbing, HVAC equipment, solar panels and battery storage can also change characteristics of the property that an insurer may need to know about. Certain qualifying upgrades, protective devices or mitigation improvements may also be eligible for discounts depending on the home, state, product and applicable underwriting requirements.

When the work is finished. Let your insurance agent know the project has been completed and provide any requested documentation. Homeowners should consider reviewing the home's replacement cost estimate, updating their home inventory and keeping photographs, receipts, permits and other records associated with the renovation. It's also a good opportunity to ask whether completed improvements may qualify for available discounts and whether liability limits remain appropriate.

"Don't think of the insurance conversation as something that happens only after the renovation is finished," Bakonis said. "The best time to ask questions is before the work begins, especially when you're adding square footage, making structural changes or introducing new features that may affect replacement cost or liability."

For homeowners, the goal isn't to predict whether a renovation will make insurance more or less expensive. It's to make sure the policy keeps pace with the house.

A newly remodeled kitchen, expanded living area or upgraded backyard may look very different from what was there when the policy was originally written. Making insurance part of the renovation timeline can help homeowners understand how those changes may affect their coverage and avoid discovering after a loss that their home and their policy have grown apart.

The effect of a home improvement on coverage, eligibility, discounts or premium varies based on the property, policy, state, product, underwriting requirements and other factors. Homeowners should consult their insurance agent regarding their individual circumstances.

For information about how home improvements can affect your insurance, visit the Mercury Insurance Resource Center.

About Mercury Insurance

Mercury Insurance (NYSE/NYSE TX: MCY) is a multiple-line insurance carrier predominantly offering personal auto, homeowners, renters and commercial insurance through a network of independent agents in Arizona, California, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia, as well as auto insurance in Florida. Mercury writes other lines of insurance in various states, including commercial, business owners and business auto, landlord, home-sharing, ride-hailing and mechanical protection insurance.

Since 1962, Mercury has provided customers with tremendous value for their insurance dollar by pairing ultra-competitive rates with excellent customer service, through more than 4,200 employees and a network of more than 6,340 independent agents in 11 states. Mercury has earned an "A" rating from A.M. Best, as well as "Best Auto Insurance Company" designations from Forbes and Insure.com. For more information visit www.MercuryInsurance.com or follow the company on LinkedIn, Instagram or Facebook.

Media interested in receiving updates from Mercury can learn more at the Mercury Newsroom.

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SOURCE Mercury Insurance