Landlord Tips & Tricks
April 25, 2023

4-point Inspection for Insurance

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Whether you’re considering buying a home or looking at selling your home, you’re going to want to ensure that you’re set up for success. A 4-point inspection can help you do just that. In this article, we’ll get into the nitty-gritty of 4-point home inspections. We’ll talk about what they are, why their important, and how they can help you make smart purchasing decisions.

What is a 4-point inspection?

A 4-point inspection examines the current condition of a house, apartment building, or other residential establishment. An inspector will review the four major systems in a home: roofing, electrical, plumbing and HVAC (heating, ventilation, and air conditioning).

In the review, a certified inspector will assess any present risks and how up-to-date the four key systems in your home are. This inspection will identify any areas that have the potential to result in an insurance claim. If the home fails part of the inspection, the inspector will go over what needs to be fixed.

Depending on where you live and the age of your house you may not need a 4-point inspection. However, if you’re hoping to get homeowners insurance, an inspection is required by all insurance providers. This test is an important factor in determining someone's eligibility to purchase a home.

What does 4-point insurance cover?

A 4-point inspection is generally a quick, visual assessment of the 4 major systems of a home. The extent of a 4-point system is enough to determine either a “pass” or “fail” grade. From this grade, an insurance company will determine whether the home meets its criteria for insurance.

Generally speaking, homeowners insurance earned from a 4-point inspection will cover the cost or a portion of the cost of repairs for your home and its contents in the event of a disaster. This coverage includes HVAC systems, furniture, clothing, kitchen appliances, and beyond.

4-point inspection vs full inspection

It’s important to note that a 4-point inspection cannot replace a full inspection as it only looks at the four major home systems rather than the whole house. In all, the inspection process takes about 30 minutes and is purely visual.

4-point inspections are specifically for home insurance providers to determine risk and are generally more prevalent in coastal areas. This is because these areas tend to be at a higher risk of catastrophic events.

In contrast, a full inspection (also known as a buyer's, real estate, or home inspection) is much more comprehensive. During a full inspection, a professional will look at everything including, but not limited to:

  • Roof and ceiling integrity
  • Home structure,
  • Electrical, plumbing, and HVAC systems
  • Crawl spaces and attics
  • Floors
  • Windows and doors

Depending on where you live, a full inspection can be required for the sale of a home. For home buyers, this provides insight into the true condition of the home and can offer leverage when negotiating the cost.

For homeowners looking to sell, this can be a great way to anticipate any repairs you may need to make before selling. It is important to note that a home inspection is different than a home appraisal, but can occasionally be helpful in a home appraisal.

4-point inspection vs wind mitigation inspection

A wind mitigation inspection identifies and assesses your home's wind-resistant features. These features can include door and window coverings, roof shapes, roof-deck attachments, and roof coverings. Similar to a 4-point inspection, a wind mitigation inspection is necessary for insurance companies to issue insurance.  

Ultimately, the point of this inspection is to inform you and your insurance provider of how resistant your home is to wind damage. This is the only type of inspection that could lead to a reduction in the cost of your insurance policy.

4-point inspection cost

The cost of a 4-point inspection can vary based on the state and the inspection company. In most cases, an inspection will cost between $75 to $175. It is crucial to make sure that the company is licensed and capable of properly evaluating your home or future home’s current state.

Who pays for the four-point inspection?

In almost all cases, the homebuyer will pay for any inspections required by insurance.

Can I use the home inspection report instead?

While there is some overlap between a 4-point inspection and a home inspection report, you will need both when purchasing and insuring a home. The 4-point inspection is designed specifically to inform insurance companies about the condition of your home.

4-point inspections do not operate on a grading scale. The only outcomes are a “pass” or “fail.” The focused nature of a 4-point inspection gives these providers a clearer indication of how much of a liability your home will be. From there they can make insurance decisions about premiums, rates, and beyond.

How to prepare for a 4-point inspection

As with any assessment, you’ll want to put your best foot forward for your 4-point inspection. You will want to repair any obvious or known damages that may be present.

Beyond fixing what you can, there are a few other things you can do to bolster your odds of approval. Here are a few things you should prioritize when preparing for your inspection:

  • Repair any exposed or frayed wiring
  • Identify leaks and water damage
  • Replace rotting or damaged wood
  • Replace old or damaged plumbing fixtures such as washing machine hoses or faucets.
  • Ensure the function and up-to-code heating and cooling systems.
  • Replace any missing or broken shingles
  • Ensure that all fire alarms and carbon monoxide detectors are functioning
  • Ensure that all doors and windows have locks
  • Identify any signs of moisture or sunlight coming into the attic.

While this is not a comprehensive list, following these guidelines can help maximize your odds of getting approved by an insurance provider. Overall, a 4-point inspection is a fast and inexpensive way to guarantee the condition of your home and avoid any future headaches. If the home assessed fails its 4-point inspections, there are a few things you can do.

  • Negotiate with the seller to make necessary repairs
  • Use an insurance provider that does not require a 4-point inspection

A third option may be to ask the insurance provider to accept a failed inspection under the condition that the necessary repairs are made within a specific time frame.  

If you’re considering selling your home, this type of inspection can give you a general overview of what may need to be addressed before selling. For homebuyers, this tool can be used to determine if a property is worth the investment.

Key takeaways

Whether you’re looking to buy a home or simply renew your insurance policy, a 4-point inspection is going to be essential for providing your insurer with information about your home's risk. 4-point inspections, while not required, are an important player in securing insurance for your new home. The streamline and specified nature of the inspection do not make them interchangeable with full inspections or mitigation inspections. Once you’ve received a passing grade, you–and more importantly, your insurance provider–will have a more clear understanding of the financial risk of your property.

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