Insurance matters when home-shopping

Issues like knob and tube wiring and buried oil tanks are problematic for insurers

Not all home insurance policies are created equal and Gary Law

Not all home insurance policies are created equal and Gary Law

When it comes to finding your dream home, innumerable factors come together to make it “just right.”

There’s the oft-cited location, certainly, as well as the overall look of the home, the number of bedrooms and bathrooms, the size and direction of the garden, and too many more details to list.

When it comes to insurance coverage, however, some features are more important than others.

“The older houses are different because of the new building codes and the whole goal (of the insurance industry) is to prevent losses,” notes Gary Law, with SeaFirst Insurance in Athlone Court.

That means prospective buyers may find certain houses challenging to insure, unless they’re willing to address the underlying concerns.

Here in Oak Bay, where many homes date from the early 1900s, knob and tube wiring commonly used in the houses through the 1920s and ‘30s is becoming problematic for home insurers, Law says.

Because the old wiring was not designed to accommodate today’s electrical load, it can create a fire risk. Even if a renovation has updated wiring in part of the house – like the kitchen, typically – knob and tube in other areas may create a risk some insurers are simply not willing to cover, Law says. Others will provide temporary coverage while the new homeowners replace the outdated wiring.

“The insurance industry is really taking a hard stance. Where the knob and tube wiring is is important and the condition of it.”

Because this may be outside the scope of a building inspector, buyers may need an electrical inspection as well.

Other issues can arise with renovations done over the years – wiring in the 1970s may not be compatible with today’s fixtures, for example. “The age of the home is really important,” Law says.

As for renovations, “What was done, when was it done and how was it done?”

Buried oil tanks can present another red flag for insurers, Law says.

Because insurance is designed to cover sudden, accidental issues, and because it covers buildings – not land – insurance does not cover the resulting contamination from a leaking oil tank.

That doesn’t prevent policy holders – or neighbours – from trying to claim compensation, however, and to avoid potentially costly disputes, the answer from most insurance companies is simply “No,” he says.

That means home buyers – or sellers – may need to investigate further as to possible contamination and the costs of clean-up and tank removal.

By and large, however, the greatest number of claims Law sees today come not from fire but from water. “Water damage is No. 1,” he says.

Back when few homes populated the municipality, drain tiles were sometimes seen as unnecessary.

In other cases, the drainage system, including gutters and downspouts, haven’t been maintained properly. With more homes creating pressure on the sewer systems, the consequence can be water back-up or flooding.

Other issues can arise with the old cast-iron pipes that can rust or from a leaking hot water tank that has out-lived its projected 10- to 15-year lifespan, Law says.

And, since more people are finding more livable space by finishing their basements, insurance costs are higher when water leaks happen.

Failed waterproofing membrane around the foundation of an older home can also present a challenge for insurers as it represents a long-standing problem – not the sudden and accidental mishap insurance typically covers.

“How did the water come into your house? That’s the key to the claim,” Law says.

The bottom line is to sit down with your broker to find the right insurance fit for your prospective home and your needs. All policies are different and individual brokers will have different products.

“Talk to your broker and get educated about what you’re purchasing,” Law says. “Make sure you understand the product you’re buying.”

 

Just Posted

Diana Durrand and Arlene Nesbitt celebrate the new artist space in 2014. Gage Gallery moves this summer from Oak Bay to Bastion Square in Victoria. (Black Press Media file photo)
Gage Gallery moving to Bastion Square

Vivid Connections, a showcase by Laura Feeleus and Elizabeth Carefoot, opens new venue June 29

Days after students’ return to Victoria High School was delayed by a year, the province has announced some amenities that will be included in the school’s expansion project. (Photo by Cole Descoteau)
Child-care spots, artificial turf field, non-profit space included in Vic High expansion

SD61 now aims to welcome students back at the high school by September 2023

Gwen Spencer Hethey with her uncle and mentor Major Frederick Richardson. (Courtesy of Greater Victoria Sports Hall of Fame)
‘She was a killer’: The Victoria woman who pioneered female sharpshooting

Gwen Spencer Hethey made military men ‘look like turkeys’ says her son

Anita Troop officially turns 100 on Sunday and cards are pouring in from around the world. (Courtesy Marina Miller)
Cards roll in from around the world for West Shore 100 year old

About 100 cards have come for the woman who turns 100 on Sunday

Patrick O’Brien, a 75-year-old fisherman, went missing near Port Angeles Thursday evening. (Courtesy of U.S. Coast Guard)
UPDATE: Search suspended for angler missing between Port Angeles and Victoria

The 75-year-old man was reported missing Thursday evening

A small pod of Pacific white-sided dolphins pass by close to shore in Campbell River June 16, 2021. Still capture from video courtesy of Kimberly Hart
VIDEO: Dolphin sunset captured from Vancouver Island shore

Spectacular setting for view of travelling pod of Pacific white-sided dolphins

A North Vancouver man was arrested Friday and three police officers were injured after a 10-person broke out at English Bay on June 19, 2021. (Youtube/Screen grab)
Man arrested, 3 police injured during 10-person brawl at Vancouver beach

The arrest was captured on video by bystanders, many of whom heckled the officers as they struggled with the handcuffed man

Patrick O’Brien, a 75-year-old fisherman, went missing near Port Angeles Thursday evening. (Courtesy of U.S. Coast Guard)
Search for lost fisherman near Victoria suspended, U.S. Coast Guard says

The 75-year-old man was reported missing Thursday evening

Bruce Springsteen performs at the 13th annual Stand Up For Heroes benefit concert in support of the Bob Woodruff Foundation in New York on Nov. 4, 2019. (Greg Allen/Invision/AP)
Canadians who got AstraZeneca shot can now see ‘Springsteen on Broadway’

B.C. mayor David Screech who received his second AstraZeneca dose last week can now attend the show

New research suggests wolves can be steered away from the endangered caribou herds they prey on by making the man-made trails they use to hunt harder to move along. THE CANADIAN PRESS/Nathan Denette
Culling cutlines, not B.C. wolves, key to preserving caribou herds: researcher

The government has turned to killing hundreds of wolves in an effort to keep caribou around

Gary Abbott (left) and Louis De Jaeger were two of the organizers for the 2014 Spirit of the People Powwow in Chilliwack. Monday, June 21, 2021 is Indigenous Peoples Day. (Jenna Hauck/ Chilliwack Progress file)
Unofficial holidays: Here’s what people are celebrating for the week of June 20 to 26

Indigenous Peoples Day, Take Your Dog to Work Day, Onion Rings Day all coming up this week

Central Okanagan Grade 12 grads are set to get $500 each after a more than $1 million donation from a Kelowna couple. (File photo)
B.C. couple donating $500 to every Grade 12 student in the Okanagan

Anonymous donors identified as Kelowna entrepreneurs Lance and Tammy Torgerson

Rita Coolidge played the main stage at Vancouver Island Musicfest in 2017. (Black Press file photo)
This year’s Vancouver Island MusicFest to virtually showcase beauty of Comox Valley

Returning July 9 through 11 with more than 25 hours of music performances

Most Read