If you are considering the purchase of a century home, (actually any home that is 30 years or older would apply), make sure your Real Estate Agent includes a clause “Conditional on Obtaining Insurance”.
It seems Insurance Companies are becoming more particular with house insurance. Your Insurance Company may have concerns with the following:
- Knob and Tube Wiring (use the search option on this site for Knob & Tube Wiring for more details). Knob & Tube wiring is considered a higher risk mainly because there is no ground wire; the wires are highly susceptible to wearing and exposure, presenting a safety hazard. You may be required to replace all exposed knob and tube wiring with approved permanent wiring material before obtaining insurance coverage.
- 60-amp Electrical Serivce (use the search option on this site for 60-amp Electrical for more more details). Insurance companies are concerned that the 60-amp service poses the threat of overuse and overheating, increasing the risk of an electrical fire, and subsequent claim. Your insurance company will most likely require you to upgrade your electrical service to 100-amps.
NOTE: Should any electrical issues be present, be sure that your Real Estate Agent includes a clause “Conditional upon an ESA inspection”. Homes with wiring issues need to be inspected by the Electrical Safety Authority in Ontario, then deemed safe. Your Real Estate Agent should be knowledgeable to guide you through this process.
- Galvanized Steel Plumbing (use the search option on this site for Plumbing….Galvanized Steel & Leaded Pipes for more details). Galvanized steel pipes have an average life expectancy of 40 – 50 years. Over time, galvanized steel pipes begin to rust or corrode from the inside out, resulting in reduced water pressure and restricted water flow. This presents risks of leaks or ruptures in the pipes and potential for flood damage. Your insurance company most likely will require you to replace the galvanized steel piping with copper or plastic piping before providing you with insurance coverage.
- Wood Burning Stove or Wood Burning Fireplaces. Nothing beats a crackling wood burning fire, whether in a wood burning stove or fireplace….but insurance companies know that if a stove/fireplace is not properly installed and used properly, it can become a serious fire hazard. For this reason, your insurance company will require that your stove/fireplace be inspected by a certified Wood Energy Technical Training (WETT) Technician. Many home inspectors now offer this certification with their home inspection. Be sure that your Real Estate Agent includes the clause that your purchase is “Conditional upon WETT Certification”. Should your inspection be unsatisfactory, you do have the option of converting your wood burning fireplace to gas, or closing/eliminating it completely.
- Fuel Oil Tank (use the search option on this site for Oil Tanks for more details). If the property you are considering to purchase has an oil tank, most insurance companies will only insure a fuel oil tank if it is 20-25 years old and has been inspected and certified by a Technical Standards and Safety Authority (TSSA) Inspector. Again….be sure your Real Estate Agent inserts a clause in your offer that your purchase is “Conditional upon TSSA Inspection”. If your oil tank is 25 years or older, you may be required to replace it with a gas or electric furnace.
A quick summary….make sure to factor the cost of necessary upgrades, should any of the above apply to your offer to purchase. Usually your insurance company will give a 30 day grace to have improvements completed. Any questions? Feel free to contact me….
Barbara Niemann, Sales Representative
Re/Max Twin City Realty Inc., Brokerage (Kitchener Head Office)
Direct: (519) 588-5010