Regardless of your home’s age, it is important to have homeowners’ insurance. It facilitates the repair or replacement of parts of the home that experience damage due to covered events including theft, fire, and extreme weather.
Unfortunately, it is very difficult to insure older homes than newer ones. This is because older homes are more susceptible to damage, such as roof problems and fire damage. Even if you find a willing insurer, you will likely pay a higher premium for insuring your old home. To determine the specific premium, you will have to pay, the provider will consider the replacement cost value of your home. This refers to the total amount of money required to replace a home under the current market conditions.
Note: Costs of replacement are always high for older or historic homes. This is because they require specialized materials and skills to restore them back to their original form.
Why Do Older Homes Cost More to Insure?
Compared to newer homes, older homes have certain features that increase their replacement cost. For instance, some of these homes use plaster walls and ceilings, ornate trim, and non-standard doors and windows. Although these features make them seem immaculate, they are also responsible for the high cost of insurance. The reason is that their construction materials are either scarce or non-durable.
For example, many older homes feature original wiring that has either worn out or has damaged insulation. They also feature original plumbing that has undergone several decades of corrosion. Moreover, compared to the materials used in construction today, several older homes’ building materials are less resistant to fire and weather. When put together, these features pose huge risks to insurers, hence their hesitance to insure them. To mitigate these risks, those who insure older homes usually charge higher premiums.
How to Save Money on Homeowners Insurance for Older Homes?
As a proud owner of an older home, you need to ensure that your home stays in its best shape at all times. Doing this will prevent your insurer from dropping your coverage or raising your premium, as you won’t need to file a claim. Below is a list of measures you can take to achieve this.
Maintain a regular maintenance schedule
This involves regularly inspecting your home for signs of damage to the floor, ceilings, walls, etc. It also involves looking for leaks in every possible place. Further, you need to regularly remove dirt and debris from your gutter, remove mold, and replace heating and air conditioning filters. Essentially, you need to conduct regular inspections to identify and repair problems when they appear.
Update your home’s replacement cost regularly
Home improvements increase your home’s market value as well as its replacement cost. As such, endeavor to update the replacement cost value in your insurance policy whenever you carry out any improvement.
Bundle your home insurance with two or more policies
Several insurance companies offer discounts when you combine your home insurance with other policies, like auto insurance and boat insurance.
Homeowners’ insurance policies for older homes cost a lot more than those for newer homes. Therefore, we recommend that you conduct adequate research before you buy an older home. More importantly, get the right home insurance coverage to ensure adequate protection.