It is helpful to be familiar with home insurance. This includes the rebuilding and contents values. Premiums will increase if your home is more costly to repair and/or to replace.

Important to understand that insurance companies do not consider the home’s market value, but the estimated rebuild costs. Here’s a list of seven building factors that can impact your home insurance rates. Understanding the factors that drive the cost will help you address these issues to lower your costs.

1. Type of wiring

Worst option, highest insurance premiums are Knob and Tube Wiring

– Wiring used before 1950

– The most dangerous wiring (no ground wire, worn out wires or old wires).

Cooper wiring is the best alternative and has the lowest insurance premiums

– Standard wiring

– Widely used today

2. Types of plumbing

The worst alternative and highest insurance rates are lead or galvanized plumbing

– Installation before 1960s

– Zinc coated steel pipes

– Corrosion buildup with impact, e.g. Water quality and pressure (lead).

Lowest insurance rates, Copper, PVC / PEX / PB, or any other plastics are the best alternatives

Modern homes use them

– Can withstand high and low temperatures

– Resistant against chemicals in the plumbing environment

3. Type of frame

Wood is the worst alternative and has the highest insurance premiums

Fire is more likely to affect women than men

– This is often used to build smaller houses.

Concrete or brick are the best alternative and have the lowest insurance premiums

– The most stable house frames

– Designed for high-rise buildings

4. Alarm

The worst alternative and highest insurance rates are: None

– Greater risk of crime or accidents

The best alternative to insurance and the lowest rates: Security guard

– Live monitoring via an on-site guard

– The lowest risk due to potential pre-warning or mitigation

5. Building Age and Upgrades

Worst option, highest insurance premiums

– High risk of accident

– E.g. Roof not replaced within 25 years

– Potential pipe burst, leakage, fire, etc.

The best alternative to high insurance premiums is a new house

Construction – The lowest risk of any problems

– The most current construction standards

6. Stove Type

The wood stoves are the worst alternative and have the highest insurance rates

– Considered a potential source of heat

– May lead to monoxide poisoning

– Must be inspected thoroughly

Lowest insurance rates, best alternative: Electric stoves/No Stoves

Stoves are safe from fire

7. Heating Type

The worst alternative and highest insurance premiums are for oil

– Can cause environmental hazards eg. Leakage

Premiums can also be affected by the age and condition of tanks

The best alternative and lowest insurance premiums are electric heat or forced-air furnaces

– Widely used and considered safe

We hope that this information will assist you in obtaining lower home insurance rates as well as help you to understand the complex nature of home insurance.