Home Improvements That Can Lower Your Insurance Costs

If you want to reduce your home insurance costs, consider making these four improvements to your home.

Miranda Marquit
Miranda Marquit Insurance Writer
  • Co-hosts the Money Talks News podcast

  • MBA from Utah State University

Miranda is a financial writer and avid podcaster with nearly two decades of experience contributing to major outlets, including Forbes, The Hill, and NPR.

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Danny Smith
Edited byDanny Smith
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Danny SmithHome and Pet Insurance Editor
  • P&C license candidate in Massachusetts

  • 4+ years in content creation and marketing

As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.

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Updated April 6, 2023 | Reading time: 5 minutes

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You might want to consider upgrading your home after living there for a while. Home improvements make your home more comfortable and may lower your home insurance premiums in some cases.

But some home renovations can actually cause your home insurance premiums to increase. Learn more about which home improvements you can make to reduce your home insurance costs.

4 home improvements that can lower home insurance costs

Certain home improvements, such as replacing your roof, can reduce the chances that you’ll end up with damages. And you might be able to save money on your home insurance policy as a result of lowering your home’s risk. Check with your insurance company to understand what kind of discounts, if any, you could receive for upgrades before going ahead with any improvements.

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Installing a home security system

Installing a security system in your home could reduce your insurance rates since it can lead to a lower chance of theft and other vandalism damage to your home. Whether your insurer will reduce your premium depends on the type of system you install, your policy, and whether the alarms go straight to a dispatcher rather than simply alerting you.

Good to know

On average, home security systems cost between $300 and $840 to install, according to HomeGuide. Costs may vary depending on the system’s quality and whether you pay an agency to monitor your home.[1]

Upgrading your home’s systems

Upgrading your home’s systems may help reduce your home insurance premiums and could even increase the value of your home. Check your electrical system, your plumbing, and HVAC system to see if they could use upgrades, and talk to your insurer about what discounts it offers for home improvements.

Adding water leak sensors or a sump pump could also help you lower your premiums since these can help reduce the likelihood of water damage insurance claims. Smoke detectors, fire extinguishers, storm shutters, and other safety upgrades can also help reduce the amount of damage sustained during a fire or natural disaster.

The average cost to upgrade your home’s wiring can be between $10,000 and $30,000, according to HomeGuide, so weigh the costs and benefits before upgrading.[2] On the other hand, a sump pump only costs around $1,000 on average to install.[3]

Replacing your roof

Replacing your old roof might help you lower your homeowners insurance rates because a new roof will better protect against wind damage and reduce the risk of leaks, especially in hurricane-prone areas.

Newer roofs often have better materials and updated features. If you replace your older roof with one more likely to withstand a hurricane or fire damage, you could see lower rates from home insurers. You can expect to pay between $5,700 and $16,000 for a roof replacement, depending on the roof’s size and the materials used.[4]

Using smart home technology

Devices like doorbell cameras and automatic lights can help you protect your home and keep other costs down. Plus, you can monitor what’s going on while you’re out of town and act quickly if there’s a problem.

Ask your insurer about any discounts for smart technology home improvements. On average, converting your home to a smart home is likely to cost around $835.[5] Your monthly costs may be higher if you have smart home gadgets and active monitoring by a third party.

Read More: Top 12 Home Insurance Discounts

3 home improvements that can increase home insurance costs

Not every home improvement leads to lower premiums. In some cases, you might see higher insurance costs due to greater liability or an increase in the market value of your home. Here are some home improvements that might increase your home insurance premiums.

Putting in a pool

Having a swimming pool increases your home’s liability risk. Insurers usually consider pools a safety risk, so you might pay higher premiums after installing one. Some insurers may even refuse to cover your home if you have a pool, according to the National Association of Insurance Commissioners.[6]

Check Out: Pool Safety Tips for Homeowners

Adding a home office

You may be surprised to learn that your insurer might not cover your home office and its equipment. Even if it does, coverage is often limited. You might need to increase your coverage, which can lead to higher insurance premiums.

Building an addition to your home

Building an addition typically increases the value of your home, which could result in increased premiums, as the extra square footage increases how much your insurer would need to pay to rebuild it. You probably won’t need a new policy, but you might need to increase your coverage limits.

Learn More: Home Renovation Insurance: Best Homeowners Insurance During Remodeling

Factors that affect your homeowners insurance costs

A few common factors affect how much you’ll pay for home insurance, including:

  • Square footage: The size of your home is one of the main factors that affect your home insurance costs. A bigger home generally costs more to replace and rebuild, so you’ll typically pay more to insure it.

  • Location: Another key factor that insurers consider when setting insurance rates is where you live. Some ZIP codes may have a greater risk of severe weather, theft, or flooding, so insurers factor that into your policy’s cost.

  • Age of your home: Older homes might cost more to insure than newer ones, especially when they have outdated systems. Insurers usually consider factors like old electrical wiring, plumbing, roofs, and more when setting home insurance premiums.

  • Other issues: Many other factors affect home insurance premiums, including whether you have certain dog breeds, a swimming pool or trampoline, a home office, or anything that might be considered a hazard.[7]

Other ways to lower homeowners insurance costs

Rest assured, you have plenty of other ways to lower your insurance costs, including:

  • Increase your deductible. If you’re willing to pay more out of pocket, you could see lower rates. Additionally, paying your premium annually might result in discounts.

  • Comparison shop. Use online insurance quote websites to compare companies and get the best deal on your insurance coverage.

  • Bundle your insurance policies. Consider combining your homeowners insurance with your car insurance. Many companies offer a discounted rate when you bundle multiple policies.

  • Build good credit. A high credit score might result in some savings for your insurance premiums, as most insurers consider your credit when setting premiums.

  • Make other home improvements. Upgrades like solar panels, a water shut-off device, and a home surveillance system are low-cost ideas that can help you save on insurance.[8]

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Do you need more homeowners insurance coverage after making home improvements?

It’s smart to contact your insurance agent when you make changes to your home. Some changes may increase your home’s value, resulting in higher premiums. Other changes, especially ones designed to protect against inclement weather or increase your home security, might result in lower premiums.

See Also: Does Homeowners Insurance Cover Home Improvements?

Home improvements to lower insurance FAQs

Here are answers to some commonly asked questions about how home improvements affect insurance.

  • Should you report home improvements to your insurance company?

    Yes, you should report changes to your home to your insurance company. Home improvements often affect a home’s value and risk level, which may change how your insurer writes your policy.

  • Will homeowners insurance pay for home renovations or repairs?

    Homeowners insurance typically won’t pay for regular repairs or improvements. For the most part, insurers only cover items related to damage from covered events, such as natural disasters, vandalism, and theft.

  • What is an attractive nuisance in home insurance?

    An attractive nuisance is something that might attract children to your property and poses a danger to them.[9] Swimming pools and trampolines are common examples of attractive nuisances.

  • Do homeowners insurance companies offer discounts?

    Yes, many home insurance companies offer discounts. Many things could qualify you for a discount, including living near a fire hydrant, having fire sprinklers, installing a home security system, flood sensor, or wind-resistant shutters, and more. Call your insurance company to learn about discounts you qualify for.

  • Is homeowners insurance required?

    No, homeowners insurance isn’t required by law.[10] But most mortgage companies will require you to have it to protect their investment in your home. Additionally, it’s important to have homeowners insurance for your own financial protection, as home repairs can be very costly.


  1. HomeGuide. "How Much Does a Home Security System Cost?." Accessed March 24, 2023
  2. HomeGuide. "How much does it cost to rewire a house?." Accessed March 24, 2023
  3. HomeGuide. "How Much Does It Cost To Install Or Replace A Sump Pump?." Accessed March 24, 2023
  4. HomeGuide. "How much does a roof replacement cost?." Accessed March 24, 2023
  5. Angi | HomeAdvisor. "How Much Does A Smart Home Cost?." Accessed March 24, 2023
  6. National Association of Insurance Commissioners. "A Consumer's Guide to Home Insurance." Accessed March 24, 2023
  7. New York State Department of Financial Services. "Understanding What Affects the Cost of Insurance." Accessed March 24, 2023
  8. Insurance Information Institute. "12 Ways to Lower Your Homeowners Insurance Costs." Accessed March 24, 2023
  9. Cornell Law School | Legal Information Institute. "Attractive Nuisance Doctrine." Accessed March 24, 2023
  10. Insurance Information Institute. "Can I own a home without homeowners insurance?." Accessed March 24, 2023
Miranda Marquit
Miranda Marquit Insurance Writer

Miranda Marquit, MBA, is a freelance financial writer covering various markets and topics since 2006. She has contributed to numerous media outlets, including Forbes, TIME, The Hill, NPR, HuffPost, Yahoo! Money, and more. Her work has been syndicated by MSN Money, Marketwatch, Credit.com, and other publications. She has written about insurance topics for Clearsurance, HealthCare.com, and various other websites. She is also an avid podcaster and co-hosts the Money Talks News podcast. Miranda has a Master’s Degree in Journalism from Syracuse University. Connect with her on LinkedIn.

Danny Smith
Edited byDanny SmithHome and Pet Insurance Editor
Photo of an Insurify author
Danny SmithHome and Pet Insurance Editor
  • P&C license candidate in Massachusetts

  • 4+ years in content creation and marketing

As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.

Featured in

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