In coastal states, your insurance company may request a 4-point inspection before issuing a homeowners insurance policy. Many insurance companies require this type of inspection on rental properties older than 30 years or homes more than 40 years old. Learn more about 4-point home inspection.
What is a 4-Point Inspection?
A 4-point inspection will examine the four major systems of a home: plumbing, electrical, roofing, and the HVAC system.
Insurance companies require this inspection because they want verification that an older home has been properly maintained in these areas. Here are some of the things the inspector looks for during this process.
- Plumbing: How old is the water heater? Are there any leaks present? What kind of supply and drain lines does the home have?
- Electrical: What brand is the electrical panel? What kind of wiring is in the home? What is the overall condition of the electrical system?
- Roof: How old is the roof? What kind of roof is it? What is its overall condition? Are there leaks? Are there missing shingles or tiles?
- HVAC system: Does the home have central air and heat? How old is the system? Has the HVAC been well-maintained?
The inspector takes pictures and detailed notes and provides the insurance company with a report.
Why Are Insurance Companies Concerned With 4-Point Inspections?
A 4-Point Inspection helps an insurance company determine if they will offer you insurance on the house. These 4 components that are covered in the inspection are of concern to insurance companies because they are expensive to repair and replace. These components also have the potential to cause widespread damage if they malfunction, which would end up as a costly insurance claim. For instance a faulty electrical system could cause a house fire and a leaky roof leads to water damage and mold.
What Problems Might a 4-Point Inspection Find?
It’s possible that the inspector will find problems with the home and list them in the report. Here are some of the potential issues an inspector may encounter when performing this type of inspection.
- The roof is damaged.
- There is no central air and heat system.
- The water heater is at the end of its lifespan.
- The wiring system is a fire hazard.
- The plumbing system is too old or at risk for burst pipes.
Getting Insurance Coverage
Each insurance carrier reacts differently to the information in a 4-point inspection. Some won’t offer insurance to a home with too many problems. Others will provide coverage, but will exclude coverage on any problem areas. For example, you might be offered insurance on a home with polybutylene plumbing, but the policy excludes water damage coverage. Your other option is to update the home to repair any problems. After replacing plumbing pipes or installing a new roof, you can talk to your insurance company to extend coverage.
Order the 4-point inspection early in the process, especially when buying an older home. Then, work with your insurance agent for guidance on how to proceed to make sure your entire house is covered under the policy.