When it comes to homeowners insurance, homes will normally be inspected once, when you apply for insurance. If the specific details of your home change (like replacing old electrical systems, changing a heating system, or installing a new roof) then a follow-up inspection may be warranted. 

One of the most important situations in a person’s life is buying their own home. One aspect of homeownership is home insurance. Since a person’s home is likely to be one of the largest portions of their equity, and liability, insurance is a must-have for Canadian homeowners. 

When you first apply for a home insurance policy, you may find out that your insurance company wants a home inspection. This is a fairly normal situation, and shouldn’t make you feel uncomfortable. Think of it as a way for the insurance company to learn more about the specifics of your home, so they can give you the proper insurance. 

When Do You Need a Home Inspection for Insurance? 

Simply put, you’ll need a home inspection for your insurance if the insurer requires it.

A homeowners insurance inspection might be the first time you’re forced to undertake a home inspection. However, not all homes require the same level of inspection. 

When you first contact your insurer for a homeowner’s insurance policy, they’ll have questions for you. Since your home insurance represents liability coverage, your insurance company will want to know the quality and condition of your home before they give you an insurance policy. 

The questions they ask and the answers they get will let you know if your insurance company wants a home inspection to be completed. 

Each insurer and policy is different, but in essence, insurers are more likely to ask for a homeowners insurance inspection if you are insuring an older home. Older homes may feature somewhat outdated technology, like oil heating tanks, alternative wiring, and more. 

These types of home building techniques are from a different era, and often featured less strict safety standards than current building techniques. In essence, this boils down to increased risk for the insurance company. 

To help combat that increased risk, your insurance company will likely order a homeowners insurance inspection. Stay tuned to find out how that works, what’s involved, and why they’re an important part of the insurance industry.  

How does a Home Inspection for Insurance Purposes Work?

As stated before, an insurance home inspection occurs whenever your insurance company feels there is an increased liability in insuring your home. They undertake the home inspection to better understand the specifics of your home and the inherent risks in the materials or specifics of it. 

Each home inspection is different, as each insurance company has different methods of undertaking a home inspection. In many cases, they will bring in a home inspection company to do the actual inspection. 

The inspector will enter your home and fill out a report, detailing the specifics of your home, with special attention to risks, be they fire, flooding, collapse or other catastrophic events. They’ll be looking at your HVAC system, your roof, your plumbing, your electrical system, your chimney, as well as the exterior of your home, including and trees or sources of water that could cause damage. Basically, expect your home inspector to look at every detail of your home. 

Why Home Inspections are Important

Home inspections allow insurance companies to get a closer look at your home. Some consider home inspections a nuisance, but the simple fact is that without them, many insurance companies would simply reject older homes when they applied for homeowners insurance. 

Even if they didn’t outright reject them, they would increase rates to compensate for the somewhat unknown level of liability associated with living in an older home. 

Essentially, a home inspection for insurance will have one of three possible outcomes. Either your insurance will be approved, it will be approved with certain conditions, or it will be denied. If it’s approved, then nothing changes from the standard insurance you’ve applied for. If there are certain conditions, they likely pertain to specifics that were uncovered during the inspection process.  

If your insurance is denied based on your home inspection, you may have to contact another insurance company, potentially one with more experience in insuring older or riskier homes. 

What to Expect During a Home Inspection

When the inspector comes to your home, they will walk through it, inside and out. They may bring special tools and equipment that allow them to measure and interpret the specifics of your home. 

As stated above, they’re looking for risk, so that the insurance company understands all the details of your home and the materials it is built of, so they can tailor your insurance policy for you. 

If the inspector has any questions, answer them truthfully. Trying to hide or understate the specifics of your home can void your insurance contract, and cause you to be on the hook for the full cost of any damages that occur if something were to happen in your home. 

Home Inspection Avoidance Syndrome

Because a home inspection is a somewhat invasive procedure, many new homeowners have a natural aversion to it. This is a fairly common response, but we hope that the knowledge we’ve imparted here can help you to understand that home inspections are a normal, and helpful part of the home insurance process. 

Your insurance company can’t make a determination on the liability associated with your home’s specifics without all the information. Home inspections help to reveal that information and turn it into actionable information for the insurance company. 

The first step to overcoming your aversion to a home inspection is to educate yourself about the specifics of the insurance home inspection process. If you’ve read this article up to this point, congratulations! You’ve taken the first steps to understand the home inspection process. 

Frequently Asked Questions

What makes a home uninsurable?

To be considered uninsurable, a home would have to require serious repairs or be in an unlivable condition. This would relate to dangerous building materials, unsafe heating or electrical systems, or other situations with the potential to lead to unacceptable risk for the insurance company.