How Updates Impact Home Insurance

One of my clients in the mid-cities area of Dallas / Fort Worth referred me to her grandmother. She was concerned her grandmother was paying too much for her home and auto insurance, so I called her to gather the information needed to prepare quotes on both policies as I reviewed her current coverage.

There are a number of items I cover with someone when quoting their home insurance including square footage, number of stories, room configuration, floor coverings, and grade of finish out in the kitchen and bathrooms. I also review what updates have been made to the home. The updates insurance companies focus on are plumbing, electrical, heating and cooling, and the roof.

Plumbing: Plumbing updates may include the replacement of the water heater, faucets, drains and traps, vents, and even water supply pipes and sewage pipes. They help underwriters determine the likelihood of a water leak.

Electrical Systems: One of the top 10 causes of home fires is old or poor wiring. For homes 30 years old or older, underwriters want to know what electrical updates have been made to the home including replacing two prong outlets with three prong grounded outlets, replacing older light fixtures and ceiling fans, and even the electrical box.

Many home insurance companies will decline writing a home insurance policy for homes built prior to 1950 if they are still outfitted with screw in fuses instead of a box with circuit breakers. Some companies provide a large discount if the home has been completely rewired.

Heating and Air Conditioning: Air conditioning compressors wear out in the Texas heat as do gas furnaces and heat pumps. Knowing when these have been replaced along with the ducts and vents may help with the underwriting of the home.

Roof: More home insurance companies are taking a harder look at when the roof was last replaced. A roof’s age may determine whether an insurance companies writes the roof on a replacement or actual cash value basis or what the wind hail deductible will be (see

If the roof has been replaced, then it’s important to know the grade and kind of shingle the roof has. There are significant discounts to the premium for roofs that have been updated with hail resistant shingles. The owner or seller should have a certificate showing the class of hail resistant shingle if they chose that grade of shingle.

When it comes to these updates, insurance companies want to know whether there have been partial or full updates. For example, a partial electrical update is replacing the box but leaving the original wiring installed. A complete or full update includes replacement of the entire electrical system including box, switches, outlets, and wiring. Complete replacements of the roof are more common than a complete update to the electrical, plumbing, and heating and cooling systems.

If all four updated areas have been full or complete updates, some companies will write the home as a new home which is a significant savings on the home insurance cost. Even partial updates on electrical, plumbing, and HVAC when coupled with a full roof update provide an attractive savings.

In the case of my client’s grandmother, her updates enabled me to provide her with better coverage and a savings of almost $2,000 on her home and car insurance. What questions, comments, or experiences do you have? Share them with me on our Google +, Facebook, and LinkedIn pages. I’d love to hear from you.

Evie Wise
Evie Wise


Evie Wise
Evie Wise

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