What do you look for first when searching for a home? Location, architecture, space? Few people consider the cost of home insurance premiums, which can vary widely. Smart homebuyers will also look at a home from an insurance agent’s point of view.
If a house has a swimming pool without a privacy or security fence surrounding, red flags are waving high. It’s a liability issue waiting to happen, and every insurer will insist on protection (specs vary) before issuing a policy. Even with the fence, owning a pool requires more liability insurance.
If you love older homes, make “good bones” a priority. Insurance companies want solid foundations, a roof with plenty of years left, and reasonably up-to-date wiring, plumbing, and heating. The inspector won’t tell you that the beautiful molding and other unique features are much harder to replace, and so add to the cost of insurance. Many insurance companies won’t touch older homes, and others issue special policies geared toward old house issues.
Some DIY efforts can detract from the home’s value. That doesn’t mean you should avoid any house with do-it-yourselfers in residence (you’d be hard pressed to find such a rarity). An insurance agent can spot problem areas (no hand rail on porch steps, for instance), and give guidelines for what the insurer will want to know.
Water damage and mold are not always obvious. Ask the seller for a CLUE report on the home. This report includes all of the claims made on the home in the last five years. It may reveal what an inspector can’t, or show that proper repairs were made – a good thing, really.
Is the home in a flood plain? Are there regional concerns like earthquakes and proximity to coastline? All of these issues require extra coverage beyond the regular home policy.
How close is the fire department? Your premium could be lower if the home is within five miles. Nearby fire hydrants are also important, as well as a fire department that employs a full-time staff, not just volunteers.
Once you’ve narrowed down your choices to one or several homes, an insurance agent will be happy to walk through them with you and issue quotes. Based on a thorough home inspection and quotes from the insurer, you’ll make a better decision about choosing the home you can afford.