What Would Make A House Uninsurable?
"The Able Elite Team insurance brokerage would like to guide you through the process of securing alternative insurance for your home. Contact our experienced brokers here to get started."
Get A QuoteBefore agreeing to underwrite an insurance policy on your home, insurance companies want to be sure they are not assuming too much risk. If they conclude they are, they can cancel your current home insurance or turn down your application for coverage.
In such an instance, the insurance company is essentially saying your home does not meet their standards for insurance coverage, thus, uninsurable.
Insurers have different, but often stringent criteria for determining whether a property is insurable or not. That said, there is a common thread on homes deemed to be uninsurable.
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Why Would You Be Refused Home Insurance?
In the majority of cases where an insurer refuses to write an insurance policy for your home, it is the home itself they have an issue with.
While every insurer will have their internal filter for uninsurable properties, there are uninsurability issues that will raise immediate red flags with every insurance company.
You should want to know what makes a house uninsurable, especially if you are house hunting. If a home is uninsurable, you will struggle to get mortgage financing for it because lenders insist on proof of insurance.
1. Poor, non-standard construction
A house that shows cracks all over because its foundations are weak or the construction is sub-standard will be unsafe to occupy. An unsafe home immediately raises liability issues as it does the high prospect of frequent claims, which can make it uninsurable.
Get A Quote2. Maintenance issues
However well built a house is, it will degrade and lose its structural integrity if poorly maintained. A poorly maintained property will show several signs of disrepair, like saggy roofs, broken windows, and peeling plaster.
Even dead trees that look like they can fall anytime are signs of a poorly maintained property. Anything that compromises the structural integrity and safety of a house also raises liability risk, increasing your chances of claiming the policy.
Get A Quote3. Shoddy remodeling
Just as poor construction does, a poorly remodeled home can present itself as unsafe and uninsurable. The insurer will look to see if the remodeling didn’t flout any building
codes or compromise the plumbing or electrical wiring in the home. If it did, they will pass on the opportunity to write a policy on it.
Get A Quote4. Claims history
Before buying a house, check to see if there have not been any insurance claims on it. If there have been, you will want to what they were for.
It is likely because the house has unfixed structural issues that constantly put occupants in harm’s way. Insurance companies generally don’t touch houses that show a history of multiple claims.
Get A Quote5. An unfenced pool
A swimming pool is a nice feature to have on a property and which attracts home buyers. But if it is not secured with a fence, insurance companies consider it a safety risk that raises the prospect of liability claims. If you have to buy a house with a pool, fence the pool before shopping for home insurance.
Get A Quote6. Aggressive pets
In the eyes of insurers, certain dog breeds, like pit bulls, that are aggressive are not the best pets to keep.
The reason is simple. If your dog bites someone, they will sue you. To avoid the legal costs, you will claim against your home insurance. So insurance companies would rather you keep friendly pets that will not bite your visitors.
Get A Quote7. Location, location, location
It is real estate, after all. If your home is in a high crime area where burglaries are common, insurance companies may deem it to be uninsurable. Its location, in this case, raises its risk of claims.
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What to Do When You Can't Get Homeowners’ Insurance?
If you are turned down for home insurance, you must know why that has happened. This is because if the uninsurability issues at play are fixable, there is a chance you can still get the property insured.
If the house is in a state of disrepair, giving it the much-needed renovations will be the obvious fix. Similarly, issues with unsafe electrical wiring, unstable roofs, and leaky plumbing should be fixable, making the house insurable.
Have you been refused home insurance? Has your home insurance been canceled?
The Able Elite Team insurance brokerage would like to guide you through the process of securing alternative insurance for your home. Contact our experienced brokers here to get started.