As buyers tour open houses this season, one quiet budget breaker keeps slipping under the radar: homeowners insurance. Financial columnist Liz Weston of NerdWallet warns that the true price of a home can spike if the property carries unseen hazards that make coverage hard to find or costly to keep. The message lands at a time when buyers in several states are facing fewer carrier options and higher premiums, turning a routine closing step into a deal-maker or deal-breaker.
Weston’s guidance arrives as shoppers juggle rates, inspections, and bidding wars. What they may miss is how a home’s risk profile shapes long-term costs. Premiums can jump. Deductibles can rise. In some cases, coverage may not be available at all without upgrades. That kind of surprise can wreck a carefully planned budget.
“The price of homeowners insurance probably isn’t top of mind. But homes with hidden risks can make getting coverage difficult, expensive or both. Learning how to identify them could save you a bundle,” Weston said.
Why Insurance Now Shapes Home Deals
The squeeze comes from two sides. On one side, buyers face more frequent claims from severe weather and aging infrastructure. On the other, insurers are reworking how they price risk and where they are willing to write policies. That leaves certain properties stuck in a narrow lane of coverage choices.
Even when a home passes inspection, the insurance quote can still shock a buyer. Carriers look at factors that may not show up in a quick walk-through. Those details can nudge a quote up by hundreds or even thousands of dollars a year.
The Hidden Risks That Spike Premiums
Weston urged buyers to scout for red flags early. Some are structural. Others are location-based. A few are lifestyle quirks that insurers flag as higher risk.
- Replacement cost: A high rebuild estimate increases premiums, even if the purchase price seems fair.
- Roof age and material: Old or damaged roofs often trigger higher rates or coverage limits.
- Electrical and plumbing: Knob-and-tube wiring, outdated panels, or old pipes can be a deal-stopper for some carriers.
- Water exposure: Past leaks, a below-grade basement, or flood-prone lots raise the chance of claims.
- Fire exposure: Proximity to brush, limited hydrants, or remote access can push premiums up.
- Attractive nuisances: Unfenced pools, trampolines, and certain dog breeds may lead to surcharges or exclusions.
Any one of these can change the math on a mortgage. Several at once can send buyers hunting for last-resort coverage with slimmer protections and higher costs.
What Smart Buyers Do Before Bidding
Weston’s advice is simple: price the insurance early, not after the offer is accepted. She suggests getting a quote based on the address and basic details, then firming it up after the inspection. That helps expose risk factors when there is still time to walk away or negotiate repairs.
Buyers can also ask sellers for past claim histories and proof of recent upgrades. A new roof or modernized electrical system can help lower premiums and ease underwriting. If a home sits near water or brush, requesting a hazard report or local fire score can save guesswork.
Shop across multiple carriers, including regional insurers that know local hazards well. Independent agents can compare options. If one company declines, another may write the policy with different terms. Look closely at deductibles, sublimits, and exclusions so the cheapest quote does not hide gaps.
How Sellers Can Keep Deals on Track
Sellers who prepare can reach more buyers. Disclose upgrades and provide permits. Trim vegetation and address minor hazards. If the home sits in a higher-risk zone, have a recent insurance quote or mitigation plan ready. That transparency can calm buyer nerves and keep a deal from stalling late in escrow.
Market pros say a tidy insurance file now carries the same weight as a clean inspection report. It helps buyers underwrite the real cost of living in the home before emotions take over.
What This Means For The Market
Insurance is no longer a footnote. It is part of the price tag of homeownership. As carriers refine risk models and weather claims mount in some regions, more buyers will weigh coverage alongside interest rates and taxes.
Weston’s bottom line is plain and timely. A beautiful listing can hide a pricey policy. Buyers who spot risks early protect their budgets and their peace of mind. Sellers who fix hazards and document improvements protect their offers.
Expect more shoppers to ask for insurance quotes before making bids. Expect more agents to push early screening. And expect that, for many homes, the real number to watch is not just the mortgage payment. It is the premium that follows the keys.
