Manufactured Home Insurance

Manufactured or mobile housing units come in a broad array of sizes and styles, from a compact 500 square feet to generous 3,000-square-foot floor plans.

What separates them from traditional “stick-built” houses is that they are constructed off site and then transported to and assembled on the property they will become part of. Often less expensive than other houses of their size and design, manufactured housing can be very appealing to potential homebuyers.

Due to the differences between “stick-built” housing and manufactured housing, insurance companies determine their values and assess risk for manufactured homes differently than they do for other housing units. Depending on the circumstances, manufactured homes can also need forms of insurance that other homes do not. To make sure that they have the best insurance coverage for their needs, owners of manufactured homes need to be aware of these variations and take them into consideration when crafting and layering their homeowners’ insurance policies.

Standard Coverage

Like homeowners of every kind, most owners of manufactured housing will find that they are required to have a least a basic homeowner’s insurance policy in order to purchase and construct their homes, particularly if there is a mortgage involved. Standard homeowners’ insurance policies provide coverage for:

  • Damage to the home or property.
  • Damage to or loss of personal possessions.
  • Personal injury liability.

Most policies protect against damage caused by bad weather, landslides and theft, among other things. Insurance companies will insure policy-holders’ possessions up to standard value limits. For example, standard policies may cap the maximum payout for a piece of a jewelry at $1,500.

Personal injury liability covers the costs, up to established limits, of legal and medical bills associated with a visitor or service provider (i.e. anyone who does not reside on the property) being injured on the premises. Depending on the policy, this coverage may extend as far as protecting the policy holder against any injuries they, their families or their pets cause to another person off site, as well.

Policies that include Additional Living Expenses (ALE) coverage will contribute to the day-to-day living expenses of families whose homes are damaged severely enough that they are forced to temporarily relocate while repairs are made.

Standard homeowners’ insurance for manufactured or mobile homes comes in three levels of reimbursement. Actual cash value policies offer the lowest levels of reimbursement for lost or damaged possessions but are the least expensive type of insurance for homeowners to buy. Replacement cost policies are slightly more expensive but cover a policy holder’s belongings for the full amount it would cost to go out and buy a comparable item brand new. Extended value policies promise homeowners as much as 25 percent more than an item is worth at the time of insurance if it ever has to be replaced using insurance claim funds.

Standard manufactured home insurance policies are subject to strict limits. They do not cover all types of emergencies and typically only insure personal belongings up to provider-established category limits. For example, individual pieces of jewelry might only be covered up to $1,500, regardless of their actual cash or replacement values. Standard policies do not cover damage caused by flooding, earthquakes or human-caused events such as nuclear attacks. Insurance companies’ policies on sheds, garages and other outbuildings not attached to the insured house will vary.

Owners of manufactured homes seeking to purchase insurance policies must also be aware of and take into consideration issues and concerns that owners of “stick-built” homes do not. A common example is transportation insurance, which protects the home from damage between its manufacture and the completion of on-site assembly. Manufactured and mobile homes also depreciate differently than other homes over time, which homeowners must be aware of when selecting coverage.

Optional Coverage

Many owners of manufactured homes elect to layer or stack additional, optional forms of coverage with their base policies to obtain coverage that comprehensively meets their needs. Although there are many forms of supplemental coverage for owners of manufactured homes to choose from, the most commonly purchased types are:

  • Flood, Hazard or Catastrophe Insurance. This can supply the owners of manufactured homes with protections against many forms of disasters that are exempt from standard coverage. For example, floods, acts of terrorism and earthquakes are not covered by most insurance policies. Policy holders at higher risk for these events or those who are otherwise concerned, can braid these policies with their standard policy to create full coverage for themselves and their homes.
  • Floater insurance. This is used to insure specific, highly valuable belongings or collections that would otherwise be insufficiently or inconsistently covered. It can also be used to ensure that policy holders recuperate the full value if the item is lost in cases where the limits on other policies are set too low.
  • Scheduled Personal Property Insurance. This provides full coverage for unique or expensive pieces of art, jewelry, designer clothing or other high-cost possessions.
  • Personal Electronic Equipment Insurance. This insures expensive digital and electronic devices and audio-visual equipment beyond standard category cutoffs to their full values. It may include additional coverage for related costs, such as installation, as well.
  • Dog Bite Insurance. This stacks with standard homeowners’ insurance toensure that policy holders are fully covered in the event that one of their pets injuries someone. It is especially recommended for owners of large or aggressive dogs.

Many forms of optional coverage require that policy holders have the insured items professionally appraised to document their real values.

How to Save on Coverage

As with other forms of insurance, the costs of policies covering manufactured homes are determined by the:

  • Cost and condition of the property to be covered.
  • Perceived risk levels of the property.
  • Insurance claims history of the property and the owner.
  • Geographic location of the property.
  • Competition and standards within the insurance industry.

Although some of these factors are outside an owner’s control, many can be positively impacted by simple actions or decisions. Easy maintenance and security improvements, for example, can improve the condition of a property and lower an insurance provider’s perceived risk of insuring that property. This commonly results in lowered premiums. Examples of easy security improvements include installing deadbolts or security systems.

In some cases, homeowners can benefit from making insurance companies aware of changes to their neighborhoods. For instance, they may qualify for lower premiums if a Neighborhood Watch is established or new fire hydrants are installed nearby.

Owners of manufactured homes can also potentially reduce insurance costs by taking advantage of insurance industry policies and common insurance company practices. Examples include:

  • Raising the deductibles on their policies.
  • Paying off their mortgages.
  • Shopping around for the best rates.
  • Purchasing all of their insurance policies from the same provider.
  • Remaining responsibly insured by the same provider over time.

Owners of manufactured homes have a wide variety of options and opportunities when it comes to proactively and cost-effectively insuring their homes and belongings. Taking the time to understand those options and to ask questions of qualified agents when needed is the first step to making the most of them.

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