You may have recently received a payout from your homeowner’s insurance company. You might be wondering if you need to use a third party repair company or make home repairs on your own.

  • Are you allowed to complete home repairs yourself?
  • Are you allowed to keep leftover extra claim money?
  • Can you charge for your own labor?
  • Is it legal to make a profit from an insurance claim?

These are all good questions often asked by American homeowners. Keep reading to discover the answers.

You’re Typically Allowed to Complete Your Own Home Repairs

Your homeowner’s insurance company, in most cases, will calculate the cost of the work on your home. The goal is to pay you the exact amount it will cost to fix your home to its previous condition.

Your insurance will send you a check for this amount once these calculations are complete. This is the point where you can hire a contractor to make repairs. You can also complete the repairs yourself, pay a skilled friend, or hire a cheaper contractor, or just leave your home the way it is.

There are, however, a number of restrictions and things you need to know before you start messing with your policy like this.

Your Bank May Require You to Fix Your Home 

Not many people actually own their own home. Your bank can decide to fix it if they fully or partially owns your home.

You’re not technically the full owner of your home if you’re still making payments or have taken out a second mortgage. The bank, or whoever actually owns your home, will require you to fix your home to its pre-loss condition.

The reason for this is simple. Your home is collateral for your loan. When that collateral is damaged, its value drops, and the value of the loan is threatened. If you’re still making payments, then your bank has the right to require work to be performed. They may even pick a certain person or company to complete the needed repairs.

Home Repairs Tend to Be More Complex Than You Think

Plenty of homeowners have overestimated their home repair skills. You may have a small problem in your home. Once you get a $10,000 check from your insurance company, you think you just need a trip to Home Depot and a few weekends to fix the problem. The next thing you know, you’ve made the problem significantly worse and end up spending far more than $10,000.

Home repairs are more complex than most people realize. Many homeowners undervalue the work required to repair their home. Your insurance company might provide a smaller check than you need or deserve if you underestimate the amount of work that needs to be completed. This is why it’s a good idea to get an independent assessment the damages to your own home.

You’ll Receive a Check For The Items In Your Home But You Can Decide How to Spend It

Your insurance policy might cover personal items inside your home. Your insurance company is required to send you a check for the value of those items if they are damaged.

The insurance company, however, will just send you a check covering the actual cash value (ACV) of those items. They don’t require you to purchase those exact same items again. You can spend that check however you want. You could choose to buy cheaper furniture and pocket the difference.


The insurance company is ultimately required to pay the money required to repair your property. Your insurance company will give you a check to cover the costs of the repairs. Your bank may require you to make certain repairs from a certain contractor if they own your home.

If you own your home, however, you’re free to repair your home any way you like. You could choose a cheaper contractor or repair your home on your own. You could even take the money and spend it on a vacation instead of repairing your home.

However, you may not be able to file a future claim on your insurance policy if your DIY repair job or cheap contractor does a shoddy job.  If you don’t restore your home to its pre-loss condition, then your insurance could choose not to cover future claims.

You’re free to spend your settlement however you wish as long as you understand the rules and restrictions. In most cases, though, it is your best option to pay an experienced professional to repair your property.

If you have experienced home damage, give Aftermath Adjusters and Consulting a call. We’d be happy to help you get the best insurance payout possible.