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What’s Insurance Got to Do with It

There are many things that can delay buying or selling a home. No matter which end of the deal you’re on, there are important factors to take into consideration, and steps that you should be sure to take well in advance!

Location is Key

Home insurance premiums can be large or small, and a huge factor in this is where the home is located. Companies use a rating scale from 1 to 10 to judge how well-protected the area is from fire damage.

The lower the number, the closer you are to a fire station or hydrant. As that number crawls higher, you will see it reflected in the home insurance cost. In extremely rural areas, it is important to ensure you are with an independent insurance agent who has a wide variety of companies available who write home insurance policies for these higher fire danger homes.

Age of Home and Fixtures

How old is the home? If it’s over 20 years old, many insurance companies require updates. This includes things like:

• Plumbing: Update from galvanized plumbing to PVC or copper pipes.
• Electricity: Fuse boxes are dangerous, and should be replaced with circuit breakers.
• Heating System: Most furnaces over 25 years old need to be replaced or updated.
• Roof: If roof is older than 15 to 20 years old, you may need to have it repaired or replaced.

Wood Stoves or Other Heating Methods

Due to danger of fire, most companies are strict about the types of heating sources they will allow. And most also have requirements, such as factory installation and annual cleaning. They may also result in a higher home insurance quote.

Is it time to replace the old heating method with a new one? Will the benefit to the new owner and increase in sticker price outweigh the cost of installation? Be sure you ask yourself – and a professional – these questions. To avoid problems with home insurance later, make sure all the proper inspections have been done before closing on the property.

Prior Damage to Home

Don’t let the purchase or sale of your home be delayed by technicalities. Make sure your home insurance agent runs a CLUE (insurance history) report on the home to double check claims history. You’ll want to ensure that all the repairs are made as soon as possible so there are no delays in binding home insurance on the home.

Prior Claims

Have you had more than one claim in the last 5 years? Buying a home could be delayed by insurance.

• Claims related to weather are given more slack.
• Claims related to fire, theft and water damage are closely inspected.
• Some insurance companies will non-renew your policy when you are looking to purchase a new home, due to your claims history.
• The best advice? Keep a clean nose and your claims history out of hot water.

Four-Legged Friends

Are you buying a home, but own a dog? Depending on what kind of dog it is, you may find sticking points with your home insurance. This is especially true if your dog is considered vicious (Pit Bills, Rottweilers, Doberman Pinscher), or has a history of biting. Make sure you ask your insurance agent about home insurance rules if you have a dog.

Here are some examples of unacceptable dogs:

• Akita
• Alaskan Malamute
• American Staffordshire Terrier
• Bullmastiff
• Chow Chow
• Doberman Pinscher
• Great Dane
• Pit Bull
• Presa Canario
• Rottweiler
• Siberian Husky
• Staffordshire Bull Terrier
• Wolf Hybrid
• Or any mix of these breeds

Swimming Pools & Trampolines

Pools and trampolines are viewed as an “attractive nuisance” by home insurance companies, meaning that they attract liability exposure to the home (such as your neighborhood’s children). If a child comes on to your property to play on a trampoline when you’re not home and they get hurt, you are still responsible.

Some home insurance companies are more relaxed on pools or trampolines, though they usually come with stipulations, such as pools having locking fences, no diving board or a minimum depth if there is one, and no children swimming unsupervised.

Insurance Score

Virtually all home insurance companies now use an insured’s insurance score when setting up a home insurance quote or car insurance quote.

It is important to understand that an insurance score is in place to help predict future losses by an individual and a credit score is used to predict future delinquencies on credit accounts by an individual.

Examples of attributes used in an insurance score are:

• Payment history
• Collections
• Bankruptcies
• Outstanding debt
• Length of credit history
• New applications for credit
• Types of credit in use

Some insurance scores also use information gathered from other insurance companies such as premium payment history and length of time with their previous insurance company. Though a clients credit score could be high enough to close the loan, their insurance score could significantly increase their premium and possibly put them above their payment threshold, holding up the closing.

Home Insurance Agent

Your time is valuable and you must have all the documents ready well BEFORE the closing date. So, you need a home insurance agent that is responsive and fast.

Working with an independent agent is usually the best choice – they have many home insurance companies to choose from, and can pick one that they know can get home insurance quotes and binders done quickly.

Contact us today to learn more or for a free home insurance quote.