The Inspection You Need to Keep Your Homeowners Insurance
4 Point Home Inspection: The Inspection You Need to Keep Your Homeowners Insurance
When you think of flooding in Florida you think hurricanes. But insurance companies lose $2.5 billion a year in non-hurricane water damage. 14,000 homeowners deal with water leak emergencies every day. To mitigate their risk, some insurance companies in Florida insist on a 4-point inspection.
Gotta Have It
The 4-point inspection is often required by your insurance company for homes over 40 years old and rental properties over 30 years old. Homes in high-risk flood or evacuation zones are likely to be a focus of an insurance company’s scrutiny. This is a guideline; each insurance company has their own underwriting criteria.
Even if you have homeowners insurance now, your insurance company may require you to submit a 4-point inspection in order to maintain your policy. If you’re buying an older home, make sure the seller provides this inspection so you can confirm that you can get insurance. Check rates before you close the deal.
What’s the Point?
The four points include: HVAC (Heating, Ventilation, and Air Conditioning), electrical wiring and panels, plumbing connections and fixtures, and your roof. Insurance companies want to know what they are insuring. This is a non-evasive inspection of the visible components of the four systems. Although this type of inspection may uncover safety issues, it is not a safety inspection.
Yea or Nay
4-point inspections are “pass” or “fail.” Unlike a Wind Mitigation Inspection, its purpose is not to find reasons to give a homeowner a discount on their insurance. Your insurance company uses the 4-point inspection to decide whether they will offer coverage for your property at all.
Your home can fail inspection. Some reasons include: not having central heat and air, a damaged roof, aluminum wire (which is more likely overheat and cause a fire), polybutylene plumbing (which can burst), and a hot water heater over 18 years old (which can also burst).
Don't worry, the insurance company may give you an opportunity to correct these issues so you can still get insurance.
Effective September 1, 2018, the 4-point inspection has been expanded. For example:
- More photos are required, including the slope of each side of the roof.
- The condition of appliances must be noted.
- The “Hazards Present” of the electrical system is expanded.
- Additional questions including, “Is there a temperature pressure relief valve on the water heater?”
Serious About Forms
Those insurance companies are nit-picky about their forms. The 4-point inspection form is not standardized. You want to make sure the inspector is using the form that your insurance company accepts. Your agent should have that information or contact the insurance company directly. If you’re getting a home inspection, ask if the inspection company offers a discount to transfer the required information to the 4-point form. Unfortunately, you can’t just submit the full home inspection. They don’t want to dig through a long report to find what they’re looking for. On the bright side, the inspection is good for three years.
What Can Go Wrong?
You and your family benefit by fixing issues that can cause a fire and installing building features that reduce the likelihood of damage. Bad electrical wiring can cause a fire. Homeowners are at a higher risk of fire than they realize. 69% of fires are caused by bad wiring and related equipment.
A roof near the end of its useful life is more likely to leak. Insurance companies usually require that your roof have at least three years of life left in it. Most standard asphalt roofs should be repaired every 15-20 years. Although an inspection is good for three years, if your roof is close to needing replacement, you may have to prove its life expectancy the following year. It’s probably a good idea to start saving for a new one.
It’s for You, Too
For $50-$100, you should consider doing the 4-point inspection even if the insurance company doesn’t require it. You have more at stake. Fixing dangerous electrical problems before they cause a fire saves lives. You may even save money. If you’re wondering why your water bill is so high, it could be a leaky pipe. Leaks result in the waste of 1 trillion gallons of water each year.
Having a 4-point inspection can help you identify needed repairs. It costs less in the long run to fix problems before they cause damage – or loss of life.
Already have your 4 pt inspection? Awesome!
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