Manufactured Housing News

Manufactured and mobile homes have become an attractive and affordable housing option for many individuals, couples, and families. Whether you're considering a new or used manufactured home, it’s good to understand the nuances of homeowners insurance and how it applies to you. Unlike traditional houses, mobile or manufactured homes require specific coverage that’s tailored to their standards. 

The team at Triad is here to help you dive into the differences in insurance for new vs. used manufactured homes. 

Understanding Manufactured Homes and Insurance

Manufactured homes are built in controlled environments, following federal standards that are set by the Department of Housing and Urban Development (HUD). These houses, unlike modular homes or traditional homes, are built off-site and then transported to their final location. The building codes set by HUD make sure that manufactured homes meet minimum safety and durability requirements. However, these homes can still face risks, which is why they require specialized insurance.

Mobile home insurance is specifically designed to cover these risks. So how does that change when you purchase a new mobile home versus a used one? 

Buying a brand-new manufactured home often comes with certain insurance benefits. These homes are built to meet the latest construction standards and building codes, which can translate to lower insurance costs. Here's why:

1.    Replacement Cost Coverage

New manufactured homes usually qualify for replacement cost coverage. This means that if your home is damaged or destroyed, the insurance company will cover the cost of replacing it with a similar model. This is a huge advantage, since older homes often only qualify for actual cash value coverage, and there are often deductions for wear and tear.

2.    Compliance with Modern Codes

Manufactured homes built recently have to comply with updated HUD guidelines, which ensures better resistance to environmental risks like hurricanes or earthquakes. Insurance companies might reward this with lower premiums.

3.    Fewer Maintenance Concerns

New homes have less wear and tear, reducing the likelihood of costly claims. Insurance policies for new homes may include broader coverage since there’s a smaller risk of structural or mechanical issues.

4.    Optional Features and Discounts

Many new manufactured homes are equipped with features like security systems, which can lower your insurance premiums. Insurance companies frequently offer discounts for safety features that reduce potential claims.

Meanwhile, there can be certain challenges that come when you purchase a used mobile home. While these pre-owned manufactured homes are much more affordable, and they can come ready to move-in, they might result in more upkeep or less resale value. You might run into some obstacles such as:

1.    Depreciation and Wear and Tear

Over time, manufactured homes experience depreciation, which affects their insurable value. Older homes are more likely to have wear and tear, which can lead to higher premiums or exclusions in coverage. For example, an older roof may not be covered if it leaks due to lack of maintenance.

2.    Outdated Construction Standards

Older homes built before the latest HUD updates may not meet current housing and urban development requirements. As a result, insurance costs may be higher to account for increased risk.

3.    Potential Inspection Requirements

Some insurers might require an inspection of your used manufactured home before issuing a policy. Any structural or mechanical issues discovered during the inspection could lead to higher premiums, or even denied coverage.

If you’ve considered these potential challenges and still feel the cost of a brand new mobile home outweighs the benefits, a used mobile home can still be a great option. Talk with your insurance company to find the best plan for you that will cover risks and allow you to get something back on your investment down the line.

Whether you buy used or new, you’ll have a lot of options for different insurance plans. When comparing policies, consider these tips:

1.    Understand What Your Home Insurance Covers

Look for policies that offer comprehensive protection, including coverage for your home’s structure, personal belongings, and liability. Make sure that the policy includes coverage for natural disasters if you live in a high-risk area.

2.    Shop Around

Not all insurance companies specialize in mobile or manufactured homes. Take time to compare quotes and evaluate customer reviews to find a provider that understands your unique needs.

3.    Replacement Cost vs. Actual Cash Value

If possible, choose a policy with replacement cost coverage. While it may have a slightly higher premium, the peace of mind it provides is well worth it.

Deciding between a new or used manufactured home involves careful consideration. Manufactured homes are built to provide affordability and flexibility, but their age and condition can majorly influence your insurance cost and coverage options.

Related: Key Differences in Insurance: Modular vs Manufactured Homes

New manufactured homes might offer replacement cost coverage, lower premiums, and comply with modern codes. On the other hand, used homes can still be insured effectively with the right approach, and might be more affordable and move-in ready.

Whatever you choose, working with an insurance company that understands the specific needs of these homes will help protect your investment and give you confidence for the future.