If you have an older home you may be concerned with how you can properly insure it. Truth is, insuring an older home is often just as easy as insuring a newer one. But your insurance premiums may be higher, depending on age and build.   

That’s because older homes are seen by insurance companies as “high-risk,” meaning they are more fragile, construction materials may be obsolete, and structural components such as the plumbing or roofing may not be in the best shape. These are the primary reasons why homeowner’s insurance premiums for older homes tend to be higher than newer homes. Some insurance companies may not even insure homes with very old roofs or homes that suffer from cosmetic or structural damage.

That being said, there are steps you can take to ensure your older home is more insurable while keeping your insurance premiums lower. From replacing the roof to installing new plumbing to replacing aluminum wiring with copper wiring, there are many ways to offset high homeowner’s insurance costs. 

Types of Insurance You Can Get for Older Homes

Depending on your home’s age and architectural style, you could cover your home with a standard homeowner’s insurance policy. However, in light of the fact that many historic homes often cost up into the millions of dollars to rebuild and renovate, you may need to obtain specialized high-value homeowner’s insurance to cover the full replacement cost. 

Another option is to insure your house with an older home insurance policy, also known as an HO-8 policy. This is designed for homes where the cost to rebuild would be greater than the market value, but it only reimburses you for damage on an actual cash-value basis. Translation: the home’s replacement cost minus depreciation. So, if your home incurs a loss, this type of policy will not reimburse you for more costly historic building materials. 

Coverage Considerations

Own an older home? Consider these types of protections in your homeowner’s insurance policy:

Extended or guaranteed replacement cost coverage

If you experience a total loss, it could cost thousands to millions to rebuild your historic home. While you could have $1.5 million in coverage now, by the time the home is rebuilt and fully restored, it could cost another million on top of that. Consider a policy with extended or guaranteed replacement cost coverage if you can. With this, your dwelling coverage is automatically increased by an additional 25 to 50 percent if your coverage limits become maxed out. Guaranteed replacement cost coverage is an even better option, which reimburses you for the full rebuild of your home no matter how much it costs. 

Water backup coverage

This covers your home and personal property against drain or sewer backups and is an ideal coverage add-on for homes with very old piping. 

Service line coverage

This covers utility lines running from your home to the street for which you are responsible. 

Scheduled personal property coverage

Because many older homes are styled and furnished with artifacts and antiques, these are covered under the personal property coverage component of your policy. However, certain expensive valuables enjoy protection only by a limited amount of coverage, also referred to as a sublimit. If you want to boost the coverage limits for specific items, such as rugs or china sets, you will have to add a scheduled personal property to your homeowner’s insurance policy. 

Roof replacement coverage

If you get roof damage, you may only get reimbursed for the roof’s cash value if it is above a certain age, usually 10 to 15 years old.

Contact Bearce Insurance for All of Your Homeowner’s Insurance Needs

Get in touch with Bearce Insurance to learn how best to insure your older home through our homeowner’s insurance policies. Please contact us in Brockton at 508-586-3400.