Homeowner's insurance vent

clubcrackerOctober 31, 2011

We are very excited to be buying a home that was built in 1758. :) It's beautiful, well cared for, has had some tasteful updates but very much retains its original detail and charm.

Talking to insurance companies about policies is making my blood boil. Two insurers have told me that they would not write a policy unless "the house has been ripped down to its foundation" or "all the walls have been ripped out and all wiring/plumbing replaced in the last 30 years". And they say this with great disdain, like 1980's engineering is the only way to go.

I want to reach through the phone and pop them in the nose.

That is all. :)

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First I'm sorry to hear that you're running into trouble trying to obtain insurance. I'm sure that's quite frustrating to find a home you love, and one you feel is safe and fine as is only to have someone tell you that you may have to make major, possible unnecessary repairs to it.

However, you have to keep in mind that old wiring isn't up to Code. And aside from that, it most likely isn't going to be able to keep up with today's modern appliances either.

Between high powered ovens and microwaves, computers, televisions, etc. the electrical panel certainly can't be up-to-date enough to handle all of these things. We moved into a 1915 Craftsman last year, that hadn't been updated for at least 30 years and had to do serious electrical upgrades to accommodate all of those things. In fact, we had to put in a second box to run the newly renovated kitchen alone. I've spent $20,000 on new electrical thus far (that includes all items; the new service and such things like other repairs and new LED recessed kitchen lighting).

We did leave some knob and tube, our Town allowed us to do this if they were on their own circuits and only being used for one item - such as a light fixture. But, we have been even replacing those as time goes by as we can.

Luckily, we didn't run into any issues with insurance companies here in New Jersey. Not sure why. Maybe they didn't realize the house still had an antiqued system or maybe they thought it was adequate as it was for basic service.

    Bookmark   October 31, 2011 at 1:06PM
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You can always ask about a plain liability policy, but if you have to have a mortgage, that won't fly. No bank will lend you money without full coverage insurance. And full coverage insurance will be difficult to obtain with old systems that are ripe to create a claim. "Updating" isn't about fashion in an old home. It's about safety. The insurance companies are practicing "risk management" the same way that they would tell you to cut down an old overhanging rotten tree. You should grasp the significance of that before you think about purchasing an older home. Older homes are a high risk for insurance claims.

The initial costs of an old home are it's cheapest element. It will always be some high priced necessity that your home will need. It doesn't stop with insurance or plumbing or electrical updates. That's just the beginning. You will have to factor in the extra 50-75K necessary updates into the renovation mortgage in order to be able to even purchase it unless you are a complete cash sale.

There are always new homes to be had without these issues. Older homes are not for the shallow pocketed or faint of heart. They are worse than any mistress at leaving you broke, tired, and used up.

    Bookmark   October 31, 2011 at 1:40PM
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Do you have an agent who represents multiple companies or are you calling one-company offices like State Farm, Geico, etc? Travelers & Chubb both write policies on historic houses & I don't recall anyone asking me about the wiring unless it had to do with a discount but there may be a difference due to state laws & it's been awhile since I went insurance hunting. Codes are updated every few years but it doesn't mean that homeowners need to bring yesterday's build up to today's code.

I'd find someone in your area who has an old home & ask who insures it & through which agent. An agent who understands old houses is as important as finding the right contractors .

    Bookmark   October 31, 2011 at 2:05PM
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Ummm I guess I should say this is my 5th pre 1900 home. I'm well aware of the imPortance of insurance and the costs and headaches of old homes.

It was just a rant/vent...I am set and know what I can handle, live wire.

    Bookmark   October 31, 2011 at 5:27PM
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gosh, I sure do understand venting and ranting... some people (agencies, contractors, county, etc.) just don't get it! I do agree with antiquesilver, finding the right people will be harder with an old house. I know that if any contractor we potentially thought to hire, said rip it down, replace this or that with new junk, I passed over them (there were many!!)

live_wire, "Older homes are not for the shallow pocketed or faint of heart. They are worse than any mistress at leaving you broke, tired, and used up." LOL... so true, have to read this to my DH later!

    Bookmark   October 31, 2011 at 7:30PM
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Is that a direct quote - "ripped down to its foundation." That's utterly ridiculous - plumbing and electrical can be updated while leaving the walls intact. Of course, not all plumbers and electricians are old house savvy so you will have to question them closely when getting bids.

And, you should be able to find insurance companies who have dealt with old houses and know what they're all about. good luck.

    Bookmark   November 1, 2011 at 11:10AM
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live wire oak - I'm ROFL here, as I consider myself "broke, tired and used up" by my old house!

    Bookmark   November 1, 2011 at 8:34PM
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Christopher Nelson Wallcovering and Painting

live wire oak - I'm ROFL here, as I consider myself "broke, tired and used up" by my old house!

Don't we all!

    Bookmark   November 2, 2011 at 4:58AM
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"Older homes are not for the shallow pocketed or faint of heart. They are worse than any mistress at leaving you broke, tired, and used up." live_wire

This should be the phrase that appears on the front page of this forum, replacing the one by Colley Cibber.

    Bookmark   November 2, 2011 at 9:21AM
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I don't blame you for being mad! Insurance companies will drive you crazy!

Have you tried shopping around? I'm in contract for a hundred-year-old home right now and Geico gave me a very good price. But before this place, and before I learned how important it was to shop around, I was in contract on another hundred-year-old home (which fell through) and the prices I got on homeowner's insurance were astronomical! From now on I'm always going to shop around.

    Bookmark   November 16, 2011 at 11:40PM
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Whatever you do make it a high deductible - as high as you can possibly stand it because if you file a claim then you end up having to pay it back anyway in the form of surcharges the next few years.

I learned this the hard way. Bike was stolen so I thought no biggie, I'll file a claim. Imagine my surprise when the next 3 years I had to pay the surcharge to make it up to them - couldnt believe it.

At that point I raised the deductible pretty high - had been $500, now a few thousand $$$. The advantage is I could get the monthly premiums down to a more reasonable amt.

Do other insurance co's operate this way??? You end up paying them extra if you file a claim?

    Bookmark   November 17, 2011 at 7:45PM
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kashka, guess it better to avoid filing any claims (which I thought insurance was for - to insure your loss!!) but a friend once borrowed our car, crashed it.. and yes, over the next 3 years we paid a "surcharge", which in reality - WE paid for the accident. We also had a little boy running in our home, and fell.. needed 3 stitches, and we filed it with our homeowners.. same thing, so now I'll try never to file anything, unless it financially makes sense (major claim).

    Bookmark   November 18, 2011 at 6:34AM
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The purpose of insurance is to protect you from losses you would otherwise not be able to pay. If insurance reimbursed you for every loss, the premium would be prohibitive (if any company offered it).

    Bookmark   November 18, 2011 at 8:15AM
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