Insurance Problems

In the last few years, insurance companies are taking a closer look at what they will insure; long past are the days when insurance companies made so much money from their investments that it didn’t really matter what they insured.

Typically what happens is an older person sells their house and now the new owners are faced with new requirements from their insurance company. There are some exceptions with certain companies, but this usually involves higher premiums. Some insurance companies may give you time to upgrade to their standards.

Hydro Service

An example is a home with less than a 100 Amp hydro service. Please note: just because the hydro box has a 100 amp sticker on it doesn’t mean that the service is actually 100 Amp.

Also, it is a common myth that just because the house has central air conditioning means it must be 100 Amps.

Fuses not Breakers

Most insurance companies require breakers. This is because fires can result if someone replaces a fuse with a higher resistance than what the circuit is rated for.

Knob & Tube Wiring

This is also a concern, although a small percentage of knob & tube may be allowed with some companies. This is very old wiring that has no ground wire, so it cannot support three-pronged appliances, making the risk of electric shock and fire much greater.

Aluminium Wiring

Aluminum house wiring was used mostly in the 1970’s. Aluminum wiring is a poorer conductor than copper, as well as being more brittle. Connections with aluminum wiring have a tendency to loosen and overheat. Some insurance companies will require that all connections be improved or require an inspection by a licensed electrician before writing an insurance policy.

Galvanized Water Pipes

Most insurance companies will not accept galvanized water supply pipes. Galvanized water pipes are old and will eventually rust and leak. Galvanized drain pipe does not appear to be an issue at this time.

Roof Shingles

Age of the roof shingles is a concern that is self-explanatory.

Age of Furnace

This concern may be a bit difficult to understand, as some older furnaces work as well as the day they were installed, although not very efficiently.

Oil Tanks

If you have an oil furnace, check with your insurance company and ask about their requirements. Some companies require double-walled tanks or a 12-gauge thickness for single-wall tanks. Older tanks, regardless of condition, are also an insurance issue. If you’re considering buying a house with an abandoned oil tank, it will be your responsibility to remove it, which can be very costly.

Boilers

Conventional, hot water heating boilers are not an insurance issue, but require a mandatory inspection and certification by a licensed TSSA technician once a year. If the home you are purchasing has a boiler, make sure this has been done by the vendor prior to purchase.

Wood Burning Fireplaces and Stoves

Your insurance company will likely require an inspection by a Wood Energy Technology Transfer "WETT" certified technician.

Guard Rails on Porches and Stair Hand Rails

Some companies may require you to install a guard rail on porches over 18” high.

Conclusion

Every insurance company has different requirements. Farm mutual insurance companies tend to be more relaxed with their requirements. Talk to your own insurance company to see what they require.