Homeowners Insurance for Home Sellers

Real estate sellers all carry homeowners insurance.  But with all that has been going on in the insurance industry lately, a home policy just isn’t what it used to be. Premiums and deductibles are higher and cover less.

Home sellers, be aware that a home buyer may sometimes have difficulty obtaining insurance when they purchase your home.  That’s because a property’s claim history can affect its insurability.

Check Your Claims History

Before you put your home on the market, ask your insurance agent if there is anything in file that would prohibit someone else from getting a policy. Surprisingly, even an inquiry that did not result in a claim can show up in your history file. You may have to make a written request to have the entry removed from your records. Ask your insurance agent if the home is in the flood plain, and be aware that some of the flood plain boundaries have moved.

Watch Out for Water

The main culprit is water damage – which is obviously a problem here on the Gulf Coast.  Getting insurance can take a while if a home has had recent water claims, even if the source of the initial claim and all related damages have been completely repaired.

With the effects of water intrusion a larger question than in the past, check your home’s overall condition on a regular basis. Is the plumbing tight and the exterior in good condition? Check the caulking, window frames, paint job and roof.

Fill in Your Sellers Disclosure

Carefully disclose any pre-existing conditions and repairs on your Sellers Disclosure Form.  A discovery late in the game might be a deal-killer.

Don’t panic if this insurability question happens to the potential buyer of your house. It’s not an impossible situation, but it may cost time and delay your closing.

Roger Martin