Point Insurance Inspections
we have been receiving several inquiries regarding "Four
Point Inspections" this month's tip will discuss "Four
Point Insurance Inspections" written by guest "tipper"
Four Point Insurance Inspection is a little known inspection
service being offered, for a fee, by the inspection profession
in some specific areas. It appears however, that this service
opportunity is expanding. The following is provided as background
information about this program.
Four Point Insurance Inspection was created after Hurricane
Andrew struck Florida in 1992. It is performed on behalf of
the insurance companies and, typically, as a requirement for
the insurer offering insurance to the new homeowner. After
last year's barrage of hurricanes in Florida, the Four Point
Insurance Inspection has taken on added importance. As insurance
companies are beginning to see the benefit of the inspection,
the program is spreading to other areas of the country. The
benefit to the insurance company is, obviously, reduced loss
risk on homeowner's insurance policies. This is an area of
business that has, for many years, been a money loser for
2002, the Florida Legislature passed a law that combined the
Florida Residential Property and Casualty Joint Underwriting
Association (FRPCJUA) and the Florida Windstorm Underwriting
Association (FWUA). This resulted in the creation of Citizens
Property insurance Corporation (Citizens), which more efficiently
and effectively provides insurance to, and serves the needs
of, homeowners in high-risk areas and others who cannot find
coverage in the open, private insurance market. It is funded
by premiums paid by the insured and from other insurance companies
paying into the program to reduce their overall losses.
operates under the direction of a seven-member Board of Governors,
appointed by the State Treasurer for three-year terms, representing
geographically diverse regions of the state. The State Treasurer
also appoints a technical advisory board to provide information
and advice to the Board of Governors.
Citizens operates only in Florida, I personally know an inspector
in central Missouri who has transitioned his entire business
into one that deals only with insurance companies. He has
shared with me some impressive statistics showing how he has
saved the small regional companies he deals with substantial
Four Point Insurance Inspection consists of the following
(Heat, Ventilation & Air Conditioning
insurance companies are looking for the four systems to
be in generally good working condition and fulfilling their
intended function. If the home is an older home the insurance
companies want to see that the systems have been updated.
In most cases, the forms are provided by the insurance companies
to their clients. The clients then ask the inspector to
fill the form out during the course of the home inspection.
are other types of specialized programs that are similar
in nature to this type of inspection and may exist in specific
markets. For example, some states require low income buyers
to obtain an inspection of a home prior to purchase to obtain
a low interest loan. In Missouri, for example, the Missouri
Housing Development Commission (MHDC) has an inspection
requirement that is similar to a Four Point Insurance Inspection.
Another example would be in California where many homeowner
insurance companies require verification of foundation attachment
for homes built prior to 1965.
summary, the Four Point Insurance Inspection program is
gaining in popularity and will likely continue to expand
as the insurance companies recognize the value of the inspection
and the savings benefits it provides to the insurance carrier.
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