Fixer upper insurance is often harder to get than buyers expect. A cheap listing price can hide costly coverage problems. Older roofs, outdated wiring, and aging plumbing all raise red flags for insurers. As a result, some carriers charge higher premiums, and others decline the home outright.
Lenders also require proof of homeowners coverage before closing. That means fixer upper insurance problems can delay or even derail your purchase. However, most challenges can be solved with planning. This guide explains what insurers look for and what coverage gaps to watch. It also covers the steps that help you get fixer upper insurance at a fair price.
Why Insurers View Fixer-Uppers as Higher Risk
Insurers price policies based on how likely a claim is. Homes needing major repairs typically carry more risk. For example, a roof older than 20 years is more likely to leak or fail in a storm. Many carriers limit roof coverage to actual cash value once a roof passes a certain age. As a result, you may only get a depreciated payout after damage.
Electrical and plumbing systems matter just as much. Knob-and-tube wiring, fuse boxes, and aluminum branch wiring increase fire risk. Polybutylene pipes, common in homes built from the late 1970s to the mid-1990s, are prone to leaks. In most cases, insurers ask about these systems during the application. Some require replacement within 30 to 90 days of the policy start.
In some states, older homes need a four-point inspection before a policy is issued. This inspection reviews the roof, electrical, plumbing, and HVAC systems. In Florida, insurers commonly require one for homes about 30 years or older. Typically, the buyer pays for it, often $100 to $200. A failed inspection can make fixer upper insurance hard to find from standard carriers.
Common Fixer Upper Insurance Coverage Gaps
A standard homeowners policy may not fit a home under renovation. The biggest gap involves vacancy. Many policies limit coverage if a home sits vacant for more than 60 consecutive days. For example, vandalism and glass breakage claims may be excluded after that period. If you plan to gut the house before moving in, this matters a lot.
Renovation work creates other gaps. Your policy may not cover building materials stored on site before installation. It may also exclude damage caused by faulty contractor work. Therefore, always confirm your contractor carries general liability and workers’ compensation coverage. Otherwise, an injured worker could file a claim against you.
Building codes are another issue. Standard policies typically pay to rebuild what existed, not to meet current codes. Ordinance or law coverage fills this gap. It is often offered at 10% of the dwelling limit, with options for 25% or more. Older homes need it most, since repairs often trigger code upgrades.
| Challenge | Why It Matters | Possible Solution |
|---|---|---|
| Vacancy over 60 days | Vandalism and theft may be excluded | Vacant home policy or endorsement |
| Active renovation | Materials and structure may lack coverage | Builder’s risk or renovation policy |
| Old roof (20+ years) | Actual cash value payouts or denial | Replace roof or get roof certification |
| Outdated wiring or pipes | Higher fire and water claim risk | Upgrade systems, provide receipts |
| Code upgrades after a loss | Standard policies exclude upgrade costs | Ordinance or law coverage |
How to Get Fixer Upper Insurance Before Closing
Start shopping for coverage as soon as your offer is accepted. Do not wait until the week of closing. First, order a full home inspection. Share key findings with an independent insurance agent. Independent agents can quote multiple carriers, which improves your chances. As a result, you can compare options quickly.
Next, ask about the right policy type for your plans. If you will live in the home during light repairs, a standard HO-3 policy may work. However, major remodels often need a builder’s risk or renovation policy. Vacant properties may need a dwelling fire or vacant home policy. If standard carriers decline you, your state FAIR Plan may offer basic fixer upper insurance as a last resort.
Check flood risk too. Homeowners policies do not cover flood damage. Look up the property on the FEMA Flood Map Service Center. NFIP policies typically have a 30-day waiting period. Also, note FEMA’s substantial improvement rule. If renovation costs reach 50% or more of the building’s market value, the home must meet current floodplain rules. This can raise costs in high-risk flood zones.
🏠 Get Free Home Insurance Guides
Free · No spam · Unsubscribe anytime
Finally, update your insurer as work progresses. Send receipts for a new roof, electrical panel, or plumbing. In most cases, these upgrades lower your premium. Some insurers also offer discounts for fortified roofs, alarm systems, and water leak sensors. Good records help keep your fixer upper insurance affordable over time.
Frequently Asked Questions
Can you get homeowners insurance on a house that needs major repairs?
Yes, but options may be limited. Typically, standard carriers decline homes with serious roof, electrical, or structural problems. However, specialty insurers and state FAIR Plans often provide fixer upper insurance for these homes.
Is fixer upper insurance more expensive than regular homeowners insurance?
In most cases, yes. Older systems and vacancy raise the risk of claims. As a result, premiums can be noticeably higher until key repairs are done and documented.
Does homeowners insurance cover renovation damage?
Usually, it covers sudden accidents like a fire during renovation. However, it rarely covers poor workmanship or stolen materials. For example, a builder’s risk policy can protect materials and work in progress on a major remodel.
Compare Home Insurance Rates
Ready to see if you could be paying less for homeowners insurance? Compare quotes from top insurers in your area. Getting multiple quotes is the most effective way to find a better rate.
(paid link)
Official Sources & Resources
For verified information on home insurance regulations and consumer protection:
- NAIC (National Association of Insurance Commissioners): naic.org
- Insurance Information Institute: iii.org
- FEMA (Federal Emergency Management Agency): fema.gov
- FloodSmart (National Flood Insurance Program): floodsmart.gov
- USA.gov — Housing: usa.gov/housing
Content last reviewed September 2026. If you notice any outdated information, please contact us.