Does Luxury Home Insurance Cover Renovations? What to Check Before Work Starts
Luxury home insurance may not automatically cover every risk created by a renovation. Before major works begin, a homeowner should review their current policy, the building contract and the builder’s insurance to make sure there is no
gap between the existing home, the new works and valuable contents on site.
This is particularly important for luxury home insurance Australia, high-value home insurance, prestige home insurance and architect-designed homes. A substantial renovation can alter the rebuild value, construction risk and occupancy of a property — often well before the final project is complete.
Whether you are adding an extension, rebuilding a waterfront residence, renovating a heritage home or installing a new kitchen, pool, cellar or smart-home system, do not assume your existing policy will simply continue unchanged.
Does home insurance cover renovations in Australia?
It depends on the policy, the nature and value of the works, whether the home remains occupied, and the conditions set by the insurer.
Minor cosmetic work may be treated differently from structural alterations, excavation, roof removal, extensions, substantial internal works or projects involving contractors over an extended period.
A standard home policy may have conditions, exclusions or notification requirements relating to building works. For a prestige or high-value property, those details matter because the existing home itself may contain bespoke materials, custom joinery, imported finishes, fine art, luxury furnishings and specialist technology.
The safest approach is to tell your insurer or broker before work starts and obtain written confirmation of how cover will respond.
Why renovations create a luxury home insurance gap
Luxury renovations are rarely simple. They can involve architects, engineers, specialist trades, custom materials and long construction periods.
During the works, there may be exposure to:
Damage to the existing home while structural work is underway
Theft or accidental damage to valuable contents
Water damage from temporary plumbing or incomplete weatherproofing
Fire, storm or impact damage before the building is secured
Damage to new materials or works in progress
Public liability issues involving contractors, visitors or neighbours
A higher rebuild cost that exceeds the existing sum insured
Vacancy or partial occupancy conditions
The key question is not merely, “Do I have home insurance?” It is: Which policy is responsible for which part of the risk, at each stage of the project?
1. Notify your insurer before construction begins
If you are undertaking major renovations, extensions or structural work, notify your insurer or luxury home insurance broker before signing off on the project.
Be ready to explain:
The scope and estimated value of the works
Whether structural walls, roofing or foundations will be affected
Whether excavation, demolition or major plumbing work is planned
How long the project is expected to take
Whether the property will be occupied, vacant or partially occupied
Whether valuable contents will remain on site
The builder, architect and contractors involved
Do not wait until a claim occurs. A policy may contain conditions about unoccupied homes, construction activity, security and disclosure of material changes.
2. Review the building sum insured
A renovation can significantly increase the cost to rebuild a luxury property.
A new extension, custom kitchen, imported stone, bespoke cabinetry, high-end appliances, pool, wine cellar, theatre room or smart-home upgrade may not be reflected in the current building sum insured.
For a high-value home, review whether the amount reasonably considers:
The existing building and new works together
Architect, engineer, surveyor and consultant costs where applicable
Demolition, site clearance and debris removal
Specialist materials, trades and craftsmanship
Landscaping, pools, outdoor kitchens and ancillary structures
Current building-code requirements
The likely cost of rebuilding after a major insured event
Market value is not the same as rebuild cost. The land component of a prestige property may be substantial, while specialist reconstruction can also be more expensive than expected.
3. Check who insures the existing home and the new works
This is one of the most important parts of renovation insurance.
Your builder may hold insurance for their work, employees and contract obligations. However, that does not automatically mean the existing home, your contents or every project-related loss is covered by the builder’s policy.
Before works commence, clarify in writing:
Who insures the existing structure?
Who insures the new works, materials and fixtures?
Who is responsible for theft or vandalism at the site?
Who holds public liability cover?
What happens if water, fire or storm damage affects both old and new areas?
Is there cover while the property is vacant or partially uninhabitable?
Are there exclusions relating to defective work, delays or design issues?
The building contract and each insurance policy should be reviewed together. Never rely on an assumption that “the builder has insurance” without understanding what it covers.
4. Protect luxury contents, art and jewellery during the works
Renovations increase the risk of accidental damage, dust, water exposure, theft and misplacement.
If your home contains fine art, sculptures, antiques, designer furniture, jewellery, watches, wine or valuable collections, consider whether those items should be removed, securely stored or specifically insured for the renovation period.
Ask:
Are high-value items covered while temporarily stored elsewhere?
Is accidental damage included?
Do individual items need to be specified?
Are valuations current?
Are there security conditions while access to the home is increased?
Is worldwide or off-premises cover available where required?
A room-by-room inventory, photographs and updated valuations can be valuable before trades enter the property.
5. Consider vacancy and security conditions
Luxury homes under renovation can be vacant for weeks or months. That can change the insurer’s view of risk.
Vacancy may affect policy terms relating to theft, malicious damage, escape of water and property maintenance. Renovation sites can also have reduced security because doors, windows, alarms and cameras may be temporarily disconnected or incomplete.
Before work begins, confirm:
How long the property may be vacant
Whether regular inspections are required
How mail, deliveries and waste will be managed
Whether water must be isolated when the home is unattended
Which security systems must remain operational
How keys, access codes and contractor entry will be controlled
For luxury and prestige homes, security should be planned as part of the renovation — not treated as an afterthought.
6. Review cover again when the renovation is complete
Do not assume the insurance review ends when the builder hands over the keys.
Once the works are complete, update your policy to reflect the finished home and contents. This may include:
A higher building sum insured
New fixtures, fittings and appliances
New furniture, art, jewellery or wine collections
Pool, landscaping, solar, batteries or smart-home systems
Revised security features
Updated photographs, invoices and valuations
This final review helps ensure your luxury property insurance reflects the home you now own, rather than the one you had before the renovation.
Frequently asked questions
Do I need to tell my insurer about a renovation?
For major works, yes. Notify your insurer or broker before work begins so they can confirm whether your current policy remains suitable and whether additional or different cover is required.
Does a builder’s insurance cover my home during renovations?
Not necessarily. Builder insurance may cover certain construction-related risks, but it may not fully protect the existing home, your contents or every loss scenario. Check the contract and policies carefully.
Does high-value home insurance cover a renovation?
It may, subject to the individual policy and the type of work. Significant renovations often require a specific review because they can change the property’s value, risk profile and occupancy.
What insurance do I need for a luxury home renovation?
The right arrangement depends on the project, existing home, contract, builder and contents. It may involve reviewing home insurance, contract works cover, public liability arrangements and specialist cover for valuable possessions.
Should I increase my home insurance after renovating?
Usually, yes — if the renovation increases the cost to rebuild or replace your home and contents. Review the sum insured as soon as the project scope changes and again once the renovation is complete.
Specialist insurance for luxury homes under renovation
A major renovation is an ideal time to make sure your insurance has kept pace with your property.
Luxsure assists eligible homeowners across Australia with specialist luxury home insurance, prestige home insurance and high-value home insurance for bespoke residences, waterfront properties, architectural homes and valuable contents.
Before work begins, arrange a tailored review of the existing property, the proposed renovation and the cover required for every stage of the project.
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