Log homes are different than your regular home, and many homeowners and even prospect buyers tend to consider them better than your traditional stick-built homes. They often have superior craftsmanship, rustic appeal, can be extremely energy efficient, and make usage of wood’s natural “thermal mass” effect, which keeps log home interior temperatures warm and comfortable.
Like any home, a log home needs insurance. But, due to their nature, are log homes more expensive to insure than regular homes? They are made entirely from wood, after all, and many of them tend to be located rurally or “countryside.” Moreover, some log homes are dated to be well over 100 years old!
One of the most critical ways to keep your log home insurance budget-friendly is to understand the nuances that come with insuring log homes. When armed with the right knowledge, homeowners (or prospective buyers) can make more informed decisions about their insurance needs and budget. Without further waiting, let’s dive into the world of log home insurance and determine whether log homes are more expensive to insure than regular homes.
Log Home Insurance
Log home insurance is, in short, a specialized form of property insurance designed specifically to protect log homes. It offers coverage to serve the unique characteristics and risks that come with log home construction. Log home insurance may offer protection for the physical dwelling, liability claims, and personal belongings. As log homes have many distinct features, most policies will consider things like maintenance requirements, fire resistance, and replacement costs.
Log home insurance, like home insurance, may not be mandatory unless you have an ongoing mortgage and your lender requires it.
How is log home insurance different from regular home insurance?
While log home and regular home insurance share many similarities in terms of the kind of coverage they provide to protect against damages to your personal belongings, liability claims, and damage to physical property, there are several key differences to note. Here are some of the ways in which log home insurance may vary greatly from traditional home insurance:
Construction Materials: Log homes are constructed using logs as the primary building material, which sets them apart from traditional homes made of materials like brick, wood frame, or concrete. The unique construction of log homes can impact insurance coverage and premiums due to factors such as fire resistance, durability, and maintenance requirements.
Replacement Costs: The cost of rebuilding or repairing a log home can differ from that of a traditional home due to the specialized nature of log construction. Log homes may require specialized craftsmen, materials, and techniques, which can affect the replacement cost estimation used by insurance companies.
Fire Risks: Log homes may be perceived as having a higher fire risk due to the combustible nature of logs. Insurance companies consider fire safety measures such as fire-resistant coatings, chimney systems, and proximity to firefighting services when assessing insurance premiums for log homes. Luckily, most modern log homes are made to be more fire-resistant.
Policy Endorsements: Log home insurance may offer specific endorsements or riders tailored to the needs of log homeowners. These endorsements can provide coverage for log-specific risks, such as damage caused by wood-boring insects, log shifting or settling, or coverage for outbuildings like log cabins or detached structures.
These are just a few key differences to note. Further variation may exist depending on the policy and depending on the log home you want insured.
Log Home Risk Characteristics- What do insurance carriers look for?
There are many risk factors considered when insuring a home, and unfortunately, log homes are looked at with even more scrutiny. There are only a handful of carriers who will insure log homes, so the ones that do make sure they fully understand the property features before they agree to terms to insure the property. We have 3 different insurance carrier partners who currently insure log homes/cabins. Each of these 3 carriers has its own specific underwriting guidelines.
There are 3 main additional factors that our insurance company partners look at when they consider insuring a log home.
1. What type of log home is it? This is specific to whether the home is a kit log home or a custom log home.
Kit Log Homes- This is a log home that is built by using a prebuilt package of pre-cut logs. You can typically find a log home builder who will offer a number of different packages and options, but at the end of the day, the structure is pre-cut to exact specs at the builder’s location. As long as the company stays in business there will likely be replacement logs available for purchase.
Custom Log Homes- This is a log home that is built from scratch. While the home will typically have design plans, the logs are milled and delivered by length but are completely custom. There will not be any available replacement logs that are exactly alike as they were custom to the specific build. These custom builds offer the most flexibility and personalization in a project.
2. What protection class is the home located in?
3. If the home is in a protection class greater than 9, is it less than 7 miles from the reporting fire department? Let’s explain these items:
Protection Class- Simply put, this is a fire protection rating. There are 10 rankings that are used numbered 1-10 (1 being the highest quality and 10 being the worst). Distance to the responding fire department, quality of the fire department (volunteer or municipality), and the nearest water source are all factors used to come up with a score.
Any home that is rated with a 6 or less is typically in some type of city setting, 7 and above typically means the home is in a rural setting, and anything classed as a 10 is typically greater than 7 miles from a responding fire department.
If your log home is less than 7 miles from a responding fire department, we can likely help you find insurance for your log home, and most of the time we find our carriers are competitively priced against the marketplace. We have carriers who will only insure kit homes, while we have others who will only insure custom log homes, and we even have a carrier who will do both.
The biggest struggle we have found with insuring log homes is the relative distance to a responding fire department. Anything more than 7 miles can really be a challenge.
The Cost of Log Home Insurance vs Regular Home Insurance
Is the insurance more expensive on a log home? The quick answer: yes. Log homes, on average, are more expensive to insure than your regular home – even if that log home and regular home were of equal value.
Technically, fire risk may not be the biggest reason for this. Most log homes are less at risk of residential fire than your traditional homes due to their “fire-resistant” material. The biggest reason for the price increase when compared to regular home insurance is the remote location of most log houses. Log homes are also generally more expensive to build, due to their unique construction style.
However, that doesn’t mean that all log homes are more expensive to insure than regular homes. Insurance costs for log homes still vary based on the type of log home, its specific location, its size, the actual insurance policy, coverage options, deductibles, and so forth. A small cabin in the woods generally won’t be more expensive to insure than a multi-story mansion with a pool and AirBnB guest suites.
Actual Cost Examples for Log Homes we insure.
Let’s go over 3 specific examples of log homes we currently insure.
Example 1. The first example is a Kit Log home located on approximately 20 acres that was built in 2003 with a really nice stick-built metal-clad pole building. The home is insured for $580,000 with a $1,000 deductible and the insurance cost of the home is $1,580 per year. This example is in a protection class 9 area with the responding fire department being located around 4 miles away.
Example 2. This is a custom-built log home in protection class 10, but the home is less than 7 miles from the responding fire department. The home is situated on 40 acres and was built in 2006. The home is insured for $400,000 using a $1,000 deductible. It carries an annual insurance cost of $2,545 per year. There are some additional endorsements on this policy that are included in the aforementioned premium cost. These include water backup, home cyber coverage, service line coverage, and there is a secondary barn insured for $150,000.
Example 3. The last example is a custom log home that was built in 1998. It is located 5 miles from the nearest fire department and is insured for $433,000 and has a $2,500 deductible. The annual insurance cost of this log home is $1,030 per year.
Each home listed above does include an auto/home discount. In most cases, the log home insurance plans will be much better priced if you package your personal auto insurance with the same carrier. Most of the time we see 25% or greater discounts by combining the auto insurance with our log home policies.
Hitching Insurance Sells Log Home Insurance in Ohio & Surrounding Areas
Hitchings Insurance loves log homes and is happy to now be offering insurance coverage for log homeowners. We believe that these properties require expert knowledge and superior craftsmanship to withstand the test of time. Don’t let one unexpected event eradicate your investment! Your log home is a marvel – and it’s no wonder why you love it. Having property insurance for your log home can help be financially protected against potential losses.
Now that you understand the intricacies involved in insuring log homes, it’s time to act and secure the right insurance coverage for your unique property. One of the most effective ways to obtain accurate information tailored to your specific needs is by requesting a log home insurance quote from those who know and understand them.