Insurance and Electricity: Will Your Policy Cover Outdated Wiring?

Does Home Insurance Cover Electrical Fires Caused by Old Wiring?

Your home insurance is supposed to protect you from disasters, but outdated electrical wiring can complicate - or even void - your coverage.

The Short Answer

Yes, usually - standard home insurance covers fire damage regardless of cause.

But - insurance companies may:

• Deny coverage if you knew about hazards
• Refuse to renew your policy
• Charge higher premiums
• Require upgrades before coverage

How Electrical Systems Affect Insurance

Getting Coverage

When you apply for home insurance, companies assess your risk. Electrical concerns include:

High Risk (May Refuse Coverage):

• Knob and tube wiring
• Fuse boxes (not breakers)
• 60 amp or lower service
• Visible electrical hazards
• Aluminum wiring (some companies)

Moderate Risk (Higher Premiums):

• 100 amp service (may be insufficient)
• Mix of old and new wiring
• Two-prong outlets
• Panel at capacity

Low Risk (Standard Rates):

• Modern 200 amp service
• All circuit breakers
• Grounded outlets throughout
• Recent electrical inspection passed

Existing Coverage

If you already have insurance:

Your policy typically covers:

• Fire damage from electrical causes
• Damage to electronics from power surges (limits apply)
• Loss of use while home is repaired

But if claim is filed:

• Investigator may find electrical code violations
• Pre-existing hazards you knew about could affect claim
• Future coverage may be denied or premiums raised

Types of Wiring That Concern Insurers

Knob and Tube Wiring

What it is: Pre-1950 wiring with ceramic knobs and tubes

Insurance status: Many companies will NOT insure, or require:

• Professional inspection
• Higher premiums
• Agreement to upgrade
• Shorter policy terms

Why: Fire risk from:

• No ground wire
• Deteriorated insulation
• Not designed for modern loads
• Often hidden and unmaintained

Aluminum Wiring

What it is: Wiring used 1965-1973 as copper alternative

Insurance status: Some companies refuse, others accept with:

• Professional inspection
• Special connectors installed (COPALUM or similar)
• Higher premiums

Why: Fire risk from:

• Connections loosen over time
• Oxidation creates resistance
• Higher failure rate than copper

Fuse Boxes

What it is: Older electrical panels using fuses instead of breakers

Insurance status: Many companies will refuse or require:

• Immediate upgrade
• Higher premiums
• Inspection

Why: Risk from:

• Temptation to use wrong fuse size
• Can't handle modern loads
• Indicates very old system overall

How to Keep Your Coverage

Be Honest with Your Insurer

When asked about your electrical system:

• Describe it accurately
• Don't hide known issues
• Ask what upgrades they require

Why honesty matters:

• Misrepresentation can void entire policy
• Claims can be denied for non-disclosure
• Better to know requirements upfront

Get a Professional Inspection

Proactive inspection helps because:

• You learn about issues before insurer does
• Can address problems on your timeline
• Documentation of good condition
• May qualify for discounts

Make Recommended Upgrades

If your insurer requires or recommends upgrades:

• Get multiple quotes
• Document all work done
• Send documentation to insurer
• Ask about premium reduction

Insurance Premium Savings

After Electrical Upgrades:

Typical premium reductions:

| Upgrade | Potential Savings |

|---------|------------------|

| Panel upgrade (100A to 200A) | 5-15% |

| Whole-house rewire | 10-20% |

| Smoke detector hardwiring | 2-5% |

| Surge protection | 1-3% |

Actual Dollar Example:

Before upgrades: $2,400/year premium

After panel upgrade + rewire: $2,000/year premium

Annual savings: $400

10-year savings: $4,000

Combined with avoided fires and damage, electrical upgrades often pay for themselves.

What to Do If You're Denied Coverage

Options:

1. Get inspection and quotes

• Know exactly what needs fixing
• Get written estimates
• Ask insurer what would satisfy them

2. Make required upgrades

• Panel replacement
• Wiring updates
• Address specific concerns

3. Shop around

• Different companies have different standards
• Some specialize in older homes
• May find coverage at higher premium

4. Consider specialty insurers

• Some cover homes other companies won't
• Expect higher premiums
• May require more frequent inspections

Brooklyn-Specific Insurance Considerations

Pre-War Buildings:

Many Brooklyn brownstones and pre-war buildings have:

• Original or partially updated wiring
• Mixed systems from multiple renovations
• Knob and tube remnants

Insurance reality:

• Some major insurers refuse these properties
• Specialty insurers are an option
• Premiums can be 20-50% higher
• Electrical upgrades can significantly reduce costs

Multi-Family Buildings:

If you own multi-family:

• Insurance scrutiny is higher
• Electrical issues affect all units
• Upgrades may be required for coverage
• Liability concerns are greater

Protect Yourself

Document Everything:

• Keep records of all electrical work
• Get permits and inspection certificates
• Photograph your panel and major work
• Save all receipts

Review Your Policy:

• Know what's covered
• Understand exclusions
• Know your deductible
• Update coverage after improvements

Stay Current:

• Annual electrical self-inspection
• Professional inspection every 3-5 years
• Address issues promptly
• Keep insurance company informed of upgrades

Need an Electrical Upgrade?

Jetco Electrical helps Brooklyn homeowners meet insurance requirements:

✓ Panel upgrades

✓ Rewiring services

✓ Knob and tube replacement

✓ Inspection documentation for insurers

✓ Work meets all codes

Protect your home AND your coverage.

Call: (667) 455-6368