Insuring an older home can be more complicated than insuring a recently built property. Older houses may have aging roofs, electrical systems, plumbing, heating equipment, or structural components that insurers consider more likely to require repairs.
That doesn’t mean you can’t find suitable homeowners insurance. The key is understanding how insurers evaluate older properties and comparing policies based on both price and coverage.
Why Are Older Homes More Expensive to Insure?
Insurance companies generally consider the age and condition of a home when determining premiums and eligibility.
Older properties may have:
- Aging roofs
- Outdated electrical wiring
- Older plumbing
- Aging heating systems
- Original windows and doors
- Older foundations or structural components
- Building materials that are expensive or difficult to replace
Some older homes may also have features that are expensive to restore, such as historic architectural details, custom woodwork, or plaster construction.
However, the age of the home alone doesn’t determine the cost. Maintenance, renovations, location, construction materials, claims history, and the home’s replacement cost can also affect premiums.
What Type of Insurance Should You Consider?
For many homeowners, a standard homeowners policy may provide appropriate protection, but older properties sometimes require additional considerations.
Replacement Cost Coverage
Replacement cost coverage is particularly important to understand. It generally covers the cost of repairing or replacing covered property without subtracting depreciation, subject to the policy’s terms and limits.
For an older house, make sure the dwelling coverage reflects the actual cost of rebuilding the home rather than simply its market value.
Extended Replacement Cost
Some policies offer extended replacement cost coverage, which can provide additional coverage above the dwelling limit when rebuilding costs exceed the policy limit because of certain circumstances.
This can be valuable when construction costs increase unexpectedly after a major disaster.
Ordinance or Law Coverage
Older homes may not meet today’s building codes. If a covered loss requires part of the property to be rebuilt, local regulations could require upgrades.
Ordinance or law coverage can help with certain additional expenses associated with bringing a damaged property up to current building standards, subject to policy limits.
Water Backup Coverage
Older plumbing systems can make water-related problems an important consideration. Standard homeowners insurance may not cover every type of water backup or sewer-related loss.
Ask insurers whether water backup coverage is available and what it covers.
Companies to Consider
There isn’t one homeowners insurer that is cheapest or most suitable for every older home. Insurance availability and pricing can vary significantly by state, property condition, claims history, and other factors.
When shopping, consider getting quotes from several types of insurers, including:
- Large national insurance companies
- Regional insurers
- Independent agents representing multiple insurers
- Companies specializing in older or historic properties
For a particularly old or historic house, an independent insurance agent may be useful because they can help identify insurers that are willing to cover properties with unusual construction or restoration requirements.
How to Make an Older Home Easier to Insure
You may be able to improve your insurance options by addressing major maintenance issues.
Consider having professionals inspect:
Roof: Replace or repair an aging roof when necessary.
Electrical system: Older wiring may need inspection or modernization.
Plumbing: Updating old pipes can reduce certain property risks.
Heating system: Have heating equipment inspected and maintained.
Security: Smoke detectors, fire alarms, security systems, and other protective equipment may qualify for discounts with some insurers.
Keep documentation of renovations and improvements. Receipts, permits, inspection reports, and photographs can help demonstrate the condition of the property when requesting quotes.
Don’t Insure the Home Based Only on Its Market Value
A common mistake is assuming that the home’s purchase price is the amount needed to insure it.
Homeowners insurance generally focuses on the cost to rebuild the structure rather than its real-estate market value. Land value, for example, is not normally part of the dwelling replacement cost.
An older home can sometimes have a relatively low market value but a surprisingly high rebuilding cost because of specialized materials, labor, or construction requirements.
Compare More Than the Premium
When comparing policies, look at:
- Dwelling coverage limit
- Personal property coverage
- Liability coverage
- Deductibles
- Replacement-cost provisions
- Ordinance or law coverage
- Water backup coverage
- Roof coverage
- Additional living expenses
- Exclusions
- Available discounts
A policy with a lower premium may provide less protection or have higher out-of-pocket costs after a claim.
Final Thoughts
Finding homeowners insurance for an older home requires more than comparing monthly premiums. The property’s age, condition, construction type, renovation history, location, and rebuilding requirements can all affect your available options.
Start by getting several quotes and providing accurate information about the home’s condition and improvements. Then compare coverage limits, deductibles, exclusions, and additional protections—not just the advertised price.
For historic or unusually constructed homes, speaking with an independent insurance professional can also help you identify coverage designed for the property’s specific characteristics.
