Older homes are charming and beautiful, but if you consider investing in this type of property, you need to be aware that the age of a house will affect your insurance. The older a home, the higher your insurance premium will be.
What Factors into My Home Insurance Rate?
The premiums are higher because the systems and materials that make up the home are older as well, so your home may be more prone to damage. Older homes will always have more problems than newer homes, so this is something you really need to consider; otherwise, you will have to deal with very pricey insurance rates. You will need a policy that is suitable for the age and condition of your home, and proper insurance is a must, so there is no way around this aspect. You can purchase basic coverage, but this would not provide you with the protection you need, and you would be responsible for a number of payments if you were to experience property damage.
What is High-Risk Home Insurance?
Insurance companies will evaluate risks, and older homes are considered high-risk, which is why you would receive higher premiums. They would look at the cost of rebuilding your home, the materials it is made of, the age of the home, its condition and the distance from your property to a water source or fire department. They will also look at the condition of the plumbing and electrical and heating systems, and if these are in poor condition, you would face higher rates as there would be a greater risk of water or fire damage.
Why The Age of Your Home Affects the Insurance Rate
Your home’s age will impact the amount of home insurance you require, as will its location and condition. The older the home, the more of a risk it may be, and insurance companies will find it to be more susceptible to fires and problems with HVAC and roofing. If you were to get approved, you should be prepared to pay higher insurance rates than homeowners living on newer properties. If you are really set on buying an older home, you can request that your insurer do an inspection as this will help determine the age of your home’s contents, including its plumbing and wiring. The results of this inspection will also help determine whether or not your home is deemed insurable, so you will be able to make an informed decision regarding your investment.
The reality is that older homes have more structural problems than newly built properties, and this is why age is considered when applying for home insurance. Older homes will face a lot more problems than newer ones, and every aspect, including the roof, foundation, plumbing, and electrical wiring, will be seen as problematic. Insurance companies will raise the premiums to prepare for the cost of any potential claims.
If you are looking for home insurance, Leibel Insurance can help. We will provide you with fair rates, so if you are in the Edmonton or Calgary areas, contact us today!