When you purchase a new Sarasota or Longboat Key home, you may think that your insurance costs will go up.
However, according to insurance.com, in most cases the exact opposite is true. In fact, in nearly every case it is more affordable to insure a new home over an old home.
There are many factors which affect your new home insurance rates – and some of them may surprise you.
New Home Insurance Rates
To answer the original question, it is usually more expensive to insure an old home. This is for two main reasons:
- Repairs are more expensive: The more outdated the plumbing, roof, or electrical systems, the more likely that repairs will be more expensive. Not only is the repair itself generally more extensive, but may require remediation – such as removing asbestos which has been there for decades.
- Replacements are more expensive: Replacing components of the home may become very expensive if the original products or materials are no longer in production.
You may have to find an expert who recognizes the outdated system to work on it, or to obtain what you need through a special order. In many cases, such as with electrical systems, the entire system may need to be overhauled to meet new building codes, which can cost far more than a normal repair or replacement.
New home insurance is more affordable because warranties are in place, the new roof is expected to last decades, the plumbing and electrical systems are new and efficient – repairs and replacements should they be necessary are far more likely to be economical.
It is also assumed that barring a major storm or catastrophic event, there will likely not be a major claim for many years in regards the new home.
One final factor – If the home has a history of insurance claims, the rates are generally higher. A new home will have no such history.
Is Your New Home Insurance More Expensive than You Expected?
Knowing that your new home insurance should be affordable, there may be other factors which are affecting your new rates. Here are a few of the other factors which may be costing you more in your new home:
- Swimming Pools: Water features such as hot tubs and swimming pools are known to be “Attractive nuisances” which add risk to your homeowner’s policy. If your old home didn’t have a pool but your new home does, it is likely affecting the rate.
- Dangerous Breeds: If you have a dog on the “Dangerous Breeds” list, it will affect your new home insurance rates. Dog related insurance claims in 2017 were $686 million dollars, making dog bite claims one of the most common claims filed. Most insurance companies charge more for dogs on this list, while some will not even provide coverage to people with these specific dogs in the home.
- Proximity to Water: Flood insurance requirements for homes built close to any of our Sarasota waterways – whether canal, river, or Bay – may reflect a substantial rate increase over more landlocked homes. IT is important to understand the insurance policy options when choosing to build a property on the water.
When you are buying a new home – whether a new construction build or a resale – you should always speak to an insurance agent prior to a deal. Your insurance rates could be significantly different from home to home, even if the home’s values are comparable.
Call a local Sarasota insurance company to understand the full cost of purchasing your new home, which includes the amount you will need to pay for your annual homeowner’s insurance. You may be surprised at just how much the insurance policy on your new home will save you.
Lindahl Construction builds new homes and commercial property across the entire Sarasota and Longboat Key community. Call us today for more information,.