Behind the Scenes of an Insurance Inspection

Insurance boils down to risk and how much the carrier is willing to take on; therefore, it is a reasonable expectation that an insurance inspection is conducted to make an informed decision. So, what can a potential policyholder expect?

Well, it depends on what exactly is being insured. The term “insurance inspection” can apply to any item requiring coverage. So, lets look specifically at a property risk inspection for valuing a home and how it informs the underwriter’s work so that they can create a fair and accurate rate or premium fee.

Insuring Your Policy Holder

An insurance inspection of a property for the purpose of reducing financial risk is centers on two questions:

1. What would be the replacement cost of the property if it were to be completely destroyed by a covered disaster such as a house fire?
2. What hazards or risk conditions exist that increase the chances of suffering a covered loss leading to a future claim?

There are four levels of property inspection that are available as an insurer: exterior observation and photo inspection, exterior observation and measurement inspection, high-value interior inspection, and 4-point inspection. For a new home, that has just passed a battery of local inspections by the authorities with jurisdiction, a brief, cursory inspection may be all you require. This may simply consist of an address and occupancy verification and photos of the property from all sides, including the roof.

When a Comprehensive Inspection is Required

There are some instances when a more comprehensive inspection is required. Particularly if it’s been a while since the home was purchased. During a full interior/exterior general inspection for insurance purposes, areas of the home generally assessed are:

• Interior components including walls, floors, ceilings, and stairs
• Exterior components including the roof, siding, gutters and downspouts, decks and porches, exterior structures, and any additional potential risk items such as swimming pools, trampolines or tree houses
• HVAC, electrical, and plumbing systems
• Fireplaces and heating stoves

Davies Insurance Risk & Inspection does a thorough job of completing inspections for insurance companies and providing enlightening inspection reports. Visit the Risk & Inspection Solutions area of our website for more information.