If you’re a first-time homeowner, it may surprise you that insurance companies have requirements that you need to fulfill before they will issue coverage.
There are a number of things that can affect your home insurance eligibility (not all of them in your control), but there is one in particular that you should know about right away.
If your insurance company is requiring you to get a 4 point inspection, you may be confused about what it is, how to get one, and why they want it in the first place. Don’t worry! Here’s everything you need to know.
What Is a 4 Point Inspection?
Unlike a buyer’s inspection, 4 point inspections only look at four major systems of a home: structural integrity/roofing, electrical, plumbing, and HVAC (heating ventilation and air conditioning).
During the inspections, a certified home inspector will make note of the age, overall condition, and material of these systems to help insurance underwriters determine the level of risk posed by the home.
For example, they may notice that the electrical panel has been recalled, the water heater is 15 years old, or that the plumbing system uses polybutylene pipes. These are all examples of things that would increase the likelihood of you filing a claim in the future.
Why Do I Need a 4 Point Inspection?
Insurance companies typically require 4 point inspection reports before they will issue you a policy. This allows them to better calculate your premium amount or even decide whether or not to extend coverage.
Underwriters use millions of data points to help them determine and control their level of risk. For example, if you purchase an older home with outdated features or a house with water damage, your insurance company may decide that is too big of a risk. Alternatively, the inspector could find features that would make you eligible for certain discounts.
Four point inspections are also required after a home has reached a certain age. With most insurance carriers, this may be 30 to 40 years, but with a few, 4 point inspections are required when a home has reached 20 years old.
4 Point Inspection vs. Full Inspection
Although both are carried out by a licensed inspector, 4 point inspections and full inspections are not interchangeable.
Full inspections—also called buyer’s inspections—are completely optional (although highly encouraged!). They give buyers and sellers useful information that help them negotiate a price or even decide whether or not to purchase a particular property.
A 4 point inspection only looks at four areas of your home, which is rarely enough information for a savvy homebuyer. Conversely, a full buyer’s inspection will not satisfy the requirements of your homeowners insurance company.
What If My Home Fails Inspection?
Contrary to popular belief, it isn’t the inspector’s job to determine whether your home “passed” or “failed” inspection. Remember, they are only gathering information on the current state of the home.
However, your insurance company can decide whether to issue coverage based on the inspection report.
If you were getting the inspection before purchasing the home, there isn’t much you can do to reverse the insurance company’s decision. At this point, the home is generally still in the name of the seller and it is up to them whether to make the necessary updates to satisfy the insurance company.
However, if the inspection is required because your home has reached a certain age, you can update your home to take care of the issues uncovered by the report. For example, if the inspection revealed a faulty electrical system or broken HVAC unit, replacing these items may allow you to receive coverage again.
Another option is to get a preliminary inspection before your insurance company asks for it. This will give you the time to bring your home up to par without risking a lapse in coverage.
Get Insurance Help Today
If your home insurance policy was canceled after a 4 point inspection, call Darr Schackow Insurance today.
Our friendly, knowledgeable agents can search the market to find replacement coverage with another carrier as well as answer any questions you may have.
As an independent insurance agency, we work with a wide variety of insurance companies that are trusted throughout the state of Florida. This means you get coverage that meets your exact needs.
Call today for a free quote.