Most owners of historic homes view themselves as “stewards of history,” and it is important to them that their insurance allows them to repair any damage with historically accurate or at least similar materials, said Kate MacDougall, a historic home specialist and senior risk consultant with Chubb Personal Risk Services in Phoenix, Md.
Not every insurance provider is willing to risk insuring a historic home, said Kevin Sullivan, a client executive with National Trust Insurance Services, a subsidiary of the National Trust for Historic Preservation in Baltimore.
“If you ask 10 insurance carriers, ‘Who wants to insure a Victorian home built in 1910?’ maybe two would say okay,” Sullivan said. “But one would charge a lot because it’s historic, and one would charge less because that company would recognize that the home is built with superior quality that has stood the test of time.”
Premiums for insuring a historic home are typically about 20 percent higher than for a standard home, said Shannon O’Hare, a client manager with National Trust Insurance Services in Baltimore.
The reasons historic homes cost more to insure come down to two main issues: materials and building codes. Historic homes often were constructed with materials that aren’t commonly used today. Insurers have to factor in the expense of replicating those features of the house if there’s a flood or fire.
“Replacing plaster walls costs more than replacing drywall,” Meadows said. “The type of lumber and moldings in historic homes is usually more expensive. It costs more to replace solid brass fixtures than brass-plate fixtures and to replace doors with solid-wood rather than hollow doors.”
Because building codes change frequently, chances are a historic home won’t be up to today’s standards.
“Some features can be grandfathered in and won’t need to be brought up to code, but others may have to be upgraded,” Meadows said, such as widening a staircase or changing the handrails.
Unique features in a historic home sometimes require a separate insurance policy, MacDougall said.
“For example, if the home has unique stained-glass windows by Tiffany or an antique chandelier or a marble mantelpiece designed by an artist, you may need to add coverage as you would for fine art,” she said. “A separate rider on your policy for these unique features provides special coverage for breakage or repair of those items as well as replacement costs.”
Designating a house as historic could also affect premiums.
“Sometimes designations include specific requirements, such as that all windows must be replaced with wood windows that replicate the style of the original windows,” Meadows said. Those specifications could raise the cost of repairing or replacing a home, which will be factored into the premiums.
Insurance companies unfamiliar with older properties may also prefer to avoid homes with a historic designation.
“Some of our customers come to us when their insurance has been canceled by their insurance company because they found out that the property is designated as part of a historic district or on a local, state or national list of historic properties,” Sullivan said.
An insurance inspection can provide helpful information to homeowners, Meadows said. An insurance inspection focuses on the materials and condition of the house to estimate future repair and replacement costs. It is different from a home inspection, which evaluates the property’s condition for the buyer.
“Depending on the age and value of the house, an interior and exterior inspection may be done with an infrared camera to look for leaks, sagging floors, missing shingles or anything that can reveal the condition of the property,” Meadows said.
Distressed historic properties are especially challenging to insure.
“If the historic property has not been renovated and isn’t in livable condition, you may need to find a special insurance company or perhaps buy a builder’s risk policy during renovations,” Meadows said.
Knob-and-tube wiring, an installation method for electricity used in the 19th and early 20th centuries, is the No. 1 reason some companies refuse to insure a historic home, Sullivan said.
“If 75 percent of a house is knob-and-tube wiring, then the homeowners may need to replace it before the house can be insured,” MacDougall said. “Sometimes, though, a contractor can explain that the knob-and-tube wiring only supports a couple of lights rather than the entire kitchen. In that case, an insurance company may be willing to cover it.”
The cheapest homeowners insurance isn’t always the best, O’Hare warned, because you want to make sure you have enough coverage when you need it. However, she said, there are a few ways to save on your premiums.
“Adding a centrally monitored security system, such as ADT or another system monitored by a third party that will alert the police or fire company for you, can save 5 to 15 percent on your premiums,” she said. “Choosing a higher deductible, such as $1,000 to $5,000, also usually lowers your premium.”
Owning a historic house comes with a special responsibility to protect its heritage. The right insurance coverage can provide peace of mind for an owner.