What to Expect in a Home Inspection for Insurance Purposes
If you recently purchased a home and are looking for insurance, one of the first things you will need to think about is how much to insure your home for. People often have the home purchase price in mind, but that value is not adequate. Fortunately, you can ask your insurance company to conduct a home inspection, in order to determine the right value and ensure that you have the right amount of insurance.
Three Benefits of a Home Inspection
There are three specific benefits a home inspection can offer. First, it can help identify potential risks that could cause safety issues or losses, so that you can address them and avoid claims. Second, it can help identify different areas where you would be eligible for discounts on your home insurance policy that you do not already have. And third, it can help make sure that the insured dwelling value is not too high or too low.
Preparation for a Home Inspection
It is important to be prepared in advance of the inspection. Here are a few things to have in handy:
- documentation showing square footage of your home;
- details about costs for renovations or interior design work;
- information about your alarm system, water sensors, and water damage prevention devices or security features (this could get you discounts on your insurance premium); and
- list of the updates to your plumbing, heating, electrical system, windows and roof.
Most importantly, you should make sure that your house is tidy. Take the time to look at your living environment and think about fire hazards and accident prevention. For instance, are walking areas clear so people can walk safely? Do staircases have guardrails?
Focus of the Home Inspection
Home insurance inspectors will look for three basic things when they inspect your home. First, they will look for opportunities to increase security or safety. This search will include looking for potential fire hazards or liability risks in how you maintain your premises. If your home is full of unusual amounts of clutter, has mold, or exhibits signs of old water damage, the inspector will take note of this. If you have a problem that you have plans to fix, let them know, since it may help.
Second, they will take measurements of the building, look for special features, and check the quality of materials used in the construction of your home. They will take note of, for example, high ceilings, dormer windows, additional structures, and marble or specialty floors. They will also identify if you needed specialized architects or interior designers.
Third, they will check if there have been updates to the electrical system, plumbing, heating, windows, and roof. They will try to make sure that everything is well maintained.
Home inspections for insurance are different from those for real estate. The former, as discussed, focus on loss prevention and may include recommendations regarding liability or other risks. The latter, on the other hand, do not usually focus on liability concerns.
Following the home inspection, you may receive recommendations from your insurance company. It may make such recommendations as a way to help you avoid claims. Recommendations are suggestions or requirements for improvements to the safety of your home. It is important to read them carefully and ask your insurance representative if you have any questions. Your insurance could be canceled if you do not complete the recommendations. If you believe that the recommendations are unreasonable, you can try to negotiate with your insurance company.