Barndominiums are all the rage these days. They are a great way to have the best of both worlds—the rustic charm that comes with a barndo plus the conveniences of a modern home. But many people don’t realize that these unique homes can be very difficult to insure.
The main reason barndominiums are difficult to insure is their remote location. Insurance companies consider homes in rural areas a high risk because of their limited access to fire and police protection. They are also far from each other, making it difficult for neighbors to help in an emergency.
This article will walk you through why barndominiums are so hard to insure. But before we get into that, you should know that it is still possible to find insurance for your barndominium. You’ll just need to be a little more creative in your search.
1. The Location of Your Barndominium
If your barndominium is located in a rural area, it will be tough to find an insurance company willing to cover it. That’s because rural areas are considered higher risk than urban areas.
For one, emergency services (like fire and police) are often much farther away in rural areas. This means it would take longer for them to respond to an emergency at your barndominium than in an urban area.
Another reason is that homes in rural areas are often spread out more than those in urban areas. This makes it more difficult for neighbors to help in an emergency.
If your barndominium is located in a rural area, you might have to look harder for insurance than everyone else. However, you can start by contacting local insurance agents and asking if they have any recommendations for companies that insure rural barndominiums.
2. The Percentage of Living Space vs. Storage, Workshop, or Work Space
Another factor that can make it difficult to insure your barndominium is the percentage of living space vs. storage, workshop, or other space.
Many people choose to move into barndominiums precisely because of the balance they can offer between work and living space. For example, you could turn the entire ground floor into a workshop and dedicate the second floor to your living quarters.
However, most insurance companies want to see that the majority of your home is used as living space. They generally consider anything under 50% to be too high risk. This is because they see homes with a lot of storage or workshop space as more likely to have fires and other accidents.
This is why it’s so important to ensure that your barndominium is set up in such a way that the majority of it is living space. This will help you get the coverage you need.
3. Building Code Issues
Let’s face it. Some barndominiums are just not up to code.
This can be a significant problem when it comes to insurance. These companies want to make sure your home is safe and up to code before they insure it. Electric and plumbing installations are usually their biggest concerns.
If your barndominium is not up to code, it will be very difficult to find an insurance company willing to insure it. You might have to make some significant changes before you can get coverage.
4. The Cost of Your Barndo
The cost of your barndominium can also make it difficult to insure. This is because insurance companies use the value of your home to determine your premium. If your barndominium is worth more than the average home of the same size, you will have a hard time finding an insurance company willing to cover it.
This is why getting an accurate estimate of your barndominium’s value is crucial before you start shopping for insurance. You can do this by talking to local real estate agents or appraisers.
5. The Type of Construction
The type of construction is another factor that can make it difficult to insure your barndominium
because some materials are more likely to have problems than others. For example, stick-built homes are more likely to experience fires than those built with steel frames.
This is why it’s important to ensure that your barndominium is built with a type of construction that’s less likely to have problems. If you’re unsure what type of materials are in your barndominium, ask your builder or look up the building permit.
6. The Risk of Inclement Weather
Some places are just more prone to inclement weather than others. This can be a significant problem when it comes to insurance.
Picture this:
Your barndo is in a place known for tornados and hurricanes and doesn’t even have a basement. The insurance company may deem it too risky to insure, even if you have all the precautions in place.
On the other hand, if you live in an area with little to no risk of bad weather, you’ll have an easier time finding an insurance company willing to cover your barndominium.
7. The Age of Your Barndominium
Let’s say that you are renovating a 100-year-old barn into a barndominium. This can be a significant problem when it comes to insurance. These companies want to make sure your home is in good condition before agreeing to anything.
I’m not saying that you can’t get insurance for an old barndo, but there is potential for a lot of back and forth. You might have to get multiple inspections and make sure that all of the repairs are up to code before you can get insurance.
8. Barndo Security and Safety Features
Lack of security features such as burglar alarms, fire sprinklers, and security cameras can make it difficult to insure your barndominium.
The insurance company will assume that your home is more likely to be broken into or damaged if it doesn’t have these features. This is why it’s so important to talk to other barndo owners to know the security features that will get you in the good books of your insurer.
9. The Type of Coverage You Need
If you need specialized coverage for your barndominium, you might have a hard time finding an insurance company that’s willing to provide it.
This is because most insurance companies only offer basic coverage for barndominiums. You might have to get a separate policy if you need coverage for things like floods, earthquakes, or wind damage.
You should also be aware that some insurance companies might not cover all of the contents of your barndominium. If you have expensive items such as art, jewelry, or electronics, you might need a separate policy to insure them.
On a related note, if you’re thinking of getting a mortgage on your barndo, there are a few nuances you should be aware of. I’ve written a complete guide on barndominium financing, where I also discuss how many years you can finance your barndo. Don’t miss it.
10. Your Personal Situation
Your personal situation can also make it difficult to insure your barndominium.
For example, if you have a poor credit score, you might have a hard time finding an insurance company that’s willing to cover you.
Insurance companies use your credit score to determine how likely you are to file a claim. If it’s poor, the insurance company will assume that you’re more likely to file a claim, and that can result in higher rates.
It’s also important to note that some insurance companies might not insure you if you have a criminal record.
