Homeowners insurance is an often-overlooked but significant cost in owning a home. Your insurance policy protects you against major losses in the event of a disaster, but you need to invest in premiums each month, which can be tricky for any family on a budget. However, you do have a measure of control. Your home electrical work in particular plays a big role in calculating your insurance payments, because outdated or faulty wiring can increase the risk of a fire. Read on to learn about what types of wiring can drive up insurance rates and how you can mitigate the costs.
The Insurance Company Makes the Call
If you don't know what kind of wiring you have in your house, you should have an electrician evaluate your system as soon as possible. Since the risk of bad wiring is so catastrophic, it might be hard to even insure a house that is too far out of date. “Some insurers will not insure you at all, some will require an inspection, and some will classify you as high-risk,” CEO of insurance-services company InsurEye Alexey Saltykov told the Financial Post.
Any of these features could raise your premiums:
- Knob and Tube Wiring: Knob and tube wiring hasn't been popular in almost 80 years, but many older homes still have this system. The insulation provided by the knobs and porcelain tubes isn't considered effective for modern-day electricity consumption rates and this system is a known fire hazard. Many insurers will force homeowners to replace knob and tube wiring or go without coverage at all.
- Aluminum Wiring: Aluminum wiring is more modern than knob and tube, used widely through the 1960s, but it also carries a risk of fire. Again, in order to qualify for insurance, you may have to replace the wiring or at least undergo a safety inspection by a qualified electrician.
- Electric Vehicle Charging Stations: If you install a station to plug in your car every night, you'll save on gas money, but will likely pay more in electric bills and insurance premiums. Many homeowners who install charging stations in common areas like the street or shared parking areas are required to cover increased costs for those areas as well.
Upgrade Your Wiring and Save
If you are facing high insurance premiums because of outdated wiring, it means that your house is also at a greater risk of fire. It's well worth your while to ask an electrician about what it would cost to replace your wiring system with a whole new setup to protect your home and family. Cheaper insurance is just the icing on the cake.
Give the electricians at your local Mister Sparky® for any electrical repairs or upgrades. We're always here to help!