Home Insurance is sometimes the last thing that homebuyers think about when purchasing a home. However, understanding home insurance and home insurance rates is crucial. It should be one of the first things you think about! Especially in today’s market where buyers are purchasing without conditions like a home inspection.
Below is a quick home insurance checklist of potential insurance red flags. You should out answers to these prior to purchasing as they may impact your home insurance rates (or your ability to get insurance at all!)
Age of Roof
Whether rented or owned, it is important to know the age of the tank. Standard steel tanks over 12 years old are prone to burst or leak and will increase your home insurance rates. Your insurer may even refuse you insurance, or exclude damage from water tanks from your policy.
In Ontario, the majority of hot water heaters are rentals for an average of $35 per month.
Is there a Sump Pump?
Water damage is one of the number one insurance claims. Having a sump pump can help prevent water claims in your basement. New builds require a sump pump, but it may be a good idea to ask a plumber if you may need one based on your own experience.
Our Do I Need a Sump Pump blog has more information regarding sump pumps.
Although most homes are natural gas, there are still homes using heating oil instead of gas.
Some companies will not insure homes heated with oil. If you’re in a century home, it’s possible you have radiators- which those with allergies caused by ductwork would prefer.
It’s quite likely you’re going to premium home insurance rates if you rely on a woodstove as your heating source. Your insurer will consider these fire hazards and some insurance companies won’t insure against them.
Wood burning fireplaces will also require an inspection if you plan to use them. They will generally require a WETT inspection certificate. This is done by a professional who ensures that the fireplace is functioning properly and not a fire hazard.
Type of wiring? Knob and Tube? Aluminum?
Wiring types like Knob & Tube or Aluminum can make it really difficult to find insurance. In basic terms, if your home is between 1875-1940, it’s quite possible you have knob and tube wiring. If you own a home built between 1965-1980 it’s quite likely you have a mix of copper and aluminum wiring.
Call Beth and Ryan, Guelph real estate agents. They know what to look for and can recommend Guelph electricians!
In newer homes, this is typically not an issue. In older homes, you will want to know if there are any older galvanized supply lines.
Some insurance companies will not insure home with any galvanized piping – which is the plumbing equivalent of knob and tube wiring.
Also although highly unlikely, you may encounter KITEC plumbing. Kitec was marketed as a cheaper and easy-to-install alternative to copper piping. The issue is that the fittings didn’t fit properly, causing bursting pipes (and singificant lawsuits and recalls).
Kitec was sold between 1995 and 2007. You can identify it by it’s clearly blue (cold water) and orange (hot) colours. If a home has Kitec the listing agent must disclose it. Further, if your insurance company finds out you have it, you won’t get insurance.
Depending on age of the home, is the foundation poured concrete or block? – this can impact your ability to get water coverage for the basement and also affects premium.
Block or Stone foundations can be difficult. If you would like to learn more about the difference between concrete block foundation and poured concrete, check out our Is a Concrete Block Foundation Bad blog.
You also need to think about insurance if you are unable to pay your mortgage due to illness or even premature death. Of course, no one wants this.
But it’s important to consider the unlikely and to protect yourself. You should read this article and talk to your mortgage broker.
Older homes can be difficult to insure due to age, or you may have to pay higher home insurance rates. “Heritage Homes” can be very difficult to insure due to the strict requirements of maintenance. Homes close to water, major highways or major weather events could cause issues with insurance.
You can usually find this in the MLS listing. If the home is VERY large (4000+), there are fewer companies that will insure luxury homes.
This is not a comprehensive home insurance checklist, however it does touch on some of the major red flags that might cause you headaches when trying to get insurance.
Other considerations: Rental insurance
Although most of the above items we’ve discussed are for home owners, there is another category of insurance. This is for those who may be considering rentals in Guelph. Tenant insurance is something a landlord may require you to have if you’re renting a property.
This insurance would be on top of a homeowners insurance and protects the tenants belongings in case of a major issue like fire or flood. Be sure to talk to your insurance company if you are renting a portion of your home (or the entire home). They may require you to have some sort of proof of tenant insurance in place.
Please use this as a resource when doing a walkthrough. If you have any questions on above or other red flags you may discover on your own Beth and Ryan, Guelph Realtors are always here to help.