Insuring a 100-Year-Old Home Isn’t Simple—Here’s What Carriers Might Push Back On

Insuring a 100-Year-Old Home Isn’t Simple—Here’s What Carriers Might Push Back On

If your client is purchasing a home that's 30, 80, or even 130 years old, they may encounter unexpected challenges when securing homeowners insurance—particularly in California. As a home inspector, your report can be the difference between a smooth closing and a last-minute insurance denial.

Recent Developments Impacting Older Homes

In early 2025, California experienced devastating wildfires, including the Palisades Fire, which destroyed over 16,000 structures. These events have intensified the challenges within the state's insurance market:

  • Insurer Withdrawals: Major insurers, such as State Farm, have reduced their presence in California, citing increased wildfire risks and financial losses.

  • FAIR Plan Strain: The California FAIR Plan, designed as a last-resort insurance option, has seen a surge in policyholders, doubling since 2020. This influx has strained its resources, leading to discussions about potential surcharges for homeowners.

  • Regulatory Changes: The state has introduced reforms allowing insurers to use advanced catastrophe models for rate setting, aiming to stabilize the market and encourage insurer participation.

What Carriers Flag—And What Home Inspectors Should Watch For

As a home inspector, you’re in a unique position to identify issues that could complicate or delay insurance approvals. Here’s what to look for and highlight clearly in your reports:

Common Insurance Challenges for Older Homes

Outdated Electrical Systems

Homes with knob-and-tube wiring, aluminum wiring, or old fuse boxes are red flags. Some carriers won’t touch them. Upgrades may be required just to bind a policy.

Replacement Cost ≠ Market Value

A 4,800 sq ft farmhouse might appraise at $380K—but could cost $1M+ to rebuild with like-for-like materials. That difference can send premiums through the roof.

Historic Details = High Risk

Homes with custom windows, trim, woodwork, or plaster cost more to replace. Unless clients choose functional replacement cost (FRC) policies, they’re paying to rebuild the original aesthetic—not just the structure.

Exterior Materials

Asbestos roofing? Wood shake? Vinyl over rotted siding? These can make a home uninsurable—or drive costs up dramatically.

Outbuildings

Sheds, barns, ADUs, and garages require extra endorsements or riders. If they're not covered, a claim could be denied entirely.

Drop Risk

Even after approval, insurers can still drop the policy post-inspection (it’s happening a lot in California). Sometimes it’s due to issues like tree proximity, roof condition, or outdated systems that weren’t disclosed upfront.

Real Talk: Your Report Can Keep Deals Alive

Buyers are walking away from properties they love—not because of price, but because of surprise insurance costs. In one recent case, a buyer was quoted $12,000/year for an older home and pulled out at the 11th hour.

Your inspection report can help prevent this.

How You Can Help Buyers and Agents

  • Call out major red-flag items early—especially roof age, electrical, plumbing, and foundation issues
  • Flag any building materials that may affect replacement cost or insurability
  • Remind buyers and agents that some fixes will be required before policies are approved

Why Partner With Farmers Insurance – Young Douglas?

We’re a tech-driven California insurance agency that helps homebuyers get covered fast—even on complex properties.

Our Referral Partner Program includes:

  • A professionally designed Referral Partner PDF that shows how we promote you
  • Featured mentions in blog posts like this one
  • Cross-promotion on social media and email
  • Direct access to home insurance quote tools and our licensed agents

Check out our Referral Partner PDF or fill out the Referral Partner form.

Need a Fast Home Insurance Quote for a 100-Year-Old Home?

We handle:

  • Homes built before 1950
  • Properties with unique materials or layouts
  • Complex property setups with multiple structures

Get a free, no-obligation quote today and protect your client's closing timeline.

Request a Home Insurance Quote

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