What is a 4-point inspection?

Older houses have a unique charm and character that many new houses lack. But before you purchase an older home, it’s important to understand how the age of the house can affect your home insurance. Your insurer might require a four-point inspection before you can purchase a new policy or renew an existing one.

A four-point inspection is a type of home inspection that looks at the major systems and structures of an older house. Its purpose is to identify the risks of insuring the home and determine your home insurance eligibility. Home insurers can also use the inspection results to determine how much your policy will cost. 

What does a 4-point inspection include? 

The four major components of your home include the HVAC system, electrical system, plumbing system, and roof. During a four-point home inspection, a professional home inspector examines these items to determine their condition. Here’s a closer look at what the inspection focuses on for each component:

• HVAC system: The inspector will check the heating, ventilation, and air conditioning (HVAC) system for proper cooling and heating functions, signs of duct leakage, and general wear and tear. 

• Electrical system: The home inspector will look at the type of wiring (i.e., aluminum or knob and tube), condition of the electrical panel, outlet locations, and type of grounding.

• Plumbing system: The inspector will determine the type of pipe material and condition of the pipes and fittings, evidence of leaks or water damage, and the age of the water heater. 

• Roof: The inspector will check the material, age, and condition of the roof, as well as its structural integrity and whether the roof has proper ventilation.

When do you need a 4-point inspection? 

A four-point home inspection may be required when you purchase home insurance for an older home. Some insurance companies only require an inspection when you initially buy the policy, while other insurers require an annual four-point inspection for policy renewals. 

If you’re looking at buying a home that was built more than 30 years ago, you’ll probably need a four-point inspection to get homeowners insurance. So, why are four-point inspections necessary? 

If a home is several decades old, the roof and major home systems are typically coming to the end of their useful life. And before an insurance company agrees to insure your home, it wants to know how likely a claim will be based on the age and condition of the main systems. If the inspection uncovers problems that could lead to a costly claim, the insurance company might refuse coverage or require repairs before insuring the home.  

It’s important to note that a four-point home inspection isn’t the same thing as a full home inspection, or buyer’s inspection, which is usually a condition of a home sale. Full home inspections are much more comprehensive and focus on additional things like basements, fireplaces, attics, windows, doors, foundations, and appliances.

8 tips for preparing your home for inspection

If your home insurance company is requiring a four-point inspection, there are a few things you can do to prepare for it. Often, small repairs can improve your score. Here are some strategies you can use to prep for a four-point home inspection: 

1. Replace missing or damaged roof shingles.

2. Clear roof debris and clean gutters.

3. Replace broken electrical outlets and install GFCI outlets if any are missing. 

4. Fix leaky faucets and seal dripping pipes.

5. Gather documentation about system repairs and maintenance.

6. Change the HVAC system air filter.

7. Turn on the HVAC system to make sure it blows hot and cold air.

8. Declutter the areas around inspection points, like under sinks.

How much does a 4-point inspection cost? 

A four-point home inspection typically costs between $50 and $100, according to HomeGuide. But you could pay more than that depending on factors like your location, the size of your home, and the age of the home. 

Because four-point home inspections are less in-depth and time-intensive than full home inspections, they’re usually much cheaper. The buyer is typically responsible for the cost, especially if the inspection is required by the homeowners insurance company. 

The cost of four-point home inspections can vary. To avoid overpaying, it’s a good idea to get quotes from a few different local inspectors. Look for those that are licensed or certified, otherwise the insurance company may not accept the results of the inspection. 

What happens after your inspection?

After your four-point inspection, the inspector will send the results to the insurance company, which will review the findings. Not only will the insurer use the results to determine your eligibility for home insurance coverage, but it can also be used to determine your policy cost (called your premium).

Depending on the findings of a four-point inspection, a few things can happen:

• The insurer will determine you’re eligible for coverage and underwrite the policy: If the inspection shows that the home is in good condition, the insurance company may decide that you qualify for coverage and issue the policy. 

• The insurer will offer you coverage but with exclusions: It’s possible that the insurance company will agree to issue you a policy — but with certain coverage exclusions. For instance, if your roof is nearing the end of its life, the insurer might only insure the roof for its actual cash value (ACV), which would factor depreciation into any claim payout.

• The insurer will offer you a policy if you agree to make certain repairs: If the inspector finds small issues but no major safety concerns, the insurance company may offer to insure you after you make agreed-upon repairs. 

• The insurer will deny coverage: An insurance company may deny coverage if your home gets a very low score on a four-point inspection or if the findings indicate that the home is too risky to insure. If you have an existing home insurance policy, the insurer could even cancel your coverage or refuse to renew the policy.

What to do if your home fails

Homes don’t exactly pass or fail a four-point inspection. Instead, the inspector provides a detailed report to the insurer with their findings, and the insurance company uses that information to determine whether it will insure your home (and if so, for how much). 

If your home “fails” a four-point inspection — meaning issues pop up — you’ll receive a written letter detailing which parts of the home scored low and why. Depending on the findings of the inspection, the insurance company might give you the option to make repairs. 

Typically, home repairs must be made within 30 to 90 days of receiving notice from your insurance company. Once the issues have been fixed, you can either have the same inspector re-inspect the home, or submit proof of repairs to the insurance company. At that point, the insurer could issue a new policy or renew an existing one. 

If the insurer refuses coverage and you aren’t given the option to make repairs, it doesn’t necessarily mean that your home is uninsurable. You just might need to shop around and look for an insurer that specializes in older homes.

Another option is to get home insurance through your state’s Fair Access to Insurance Requirements (FAIR) Plan. FAIR Plans are a last-resort option for homeowners who can’t get insurance on the voluntary market. These plans offer limited coverage and often have high premiums, but they can provide dwelling insurance for older homes with outdated systems.