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Insurance for mobile and manufactured homes

Thousands of Americans purchase mobile homes each year. If you're one of them, you probably know that today's mobile homes offer quality construction and modern amenities for a much cheaper price compared to site-built homes. Depending on where you live, construction costs per square foot for a new "manufactured" home average anywhere from 10 to 35 percent less than a comparable site-built home, excluding the cost of land, according to the Manufactured Housing Institute (MHI). Prices can range from $20,000 for a single-section home with basic features to more than $100,000 for a deluxe multi-section home.

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insurance for mobile homesWhile mobile homes are relatively inexpensive to buy, they can be costly to insure.

The MHI defines mobile homes as "a single-family house constructed entirely in a controlled factory environment, built to the federal Manufactured Home Construction and Safety Standards, better known as the HUD (Housing and Urban Development) Code." The organization prefers the term "manufactured home," noting "mobile home" is the term used for homes built prior to June 15, 1976, when the HUD Code went into effect.

Regardless of which word you use, mobile home insurance is basically the same as conventional home insurance, says Bob Lapinski, spokesperson for State Farm. In both cases, the coverage and the claim process are the same. For instance, if you purchase a policy that includes "replacement cost," your mobile home insurance will cover the cost of replacing whatever has been damaged, up to your policy limit.

In general, when insuring any home, there are three major risk areas you want to insure against: damage to your home, theft of property from your home, and your legal liability for injuries or property damage.

"Insurance costs are based, number one, on exposure to risk," Lapinski says. Insurance companies assert that, statistically, there's a greater likelihood for some of those risk factors with mobile homes.

According to Lapinski, fires are a case in point. Mobile homes are not necessarily more likely catch on fire, but they are more likely to be extensively damaged if they do. If a fire breaks out in a mobile or manufactured home, it may spread more quickly, Lapinski says.

Mobile homes are not necessarily more likely catch on fire, but they are more likely to be extensively damaged if they do.

Mike Cok, vice president of specialty product management for Farmers Insurance, says that "manufactured homes are subject to the same loss peril as site-built houses." However, he notes that storms and other turbulent weather seem to impact mobile homes more than site-built homes. When high winds blow through, mobile homes are lighter than site-built homes, and tend to blow over more easily. "And that speaks to the importance of getting the right coverage," he says. Farmers Insurance owns Foremost Insurance Company, which insures between 20 to 25 percent of the mobile home market and offers customized coverage for manufactured homes.

"Our customers in hurricane prone areas have a different set of issues compared to folks that live in wild fire areas," Cok says. "These are some of the factors that drive price."

Another hazard for mobile homes can be frozen pipes, Lapinski says. Some manufactured or mobile homes may not be as well insulated as site-built homes and their pipes can freeze.

Holding down costs

Winterizing or insulating your mobile home is one easy solution to the problem of frozen pipes. This can also lower the cost of heating and cooling your home. It can cost twice as much to heat and cool an older mobile home, as it costs in a site-built home of similar age and size.

Some insurers also encourage or even require you to have your mobile home secured to the ground with approved tie-downs and ground anchors. Tie-downs can help save your home from tipping over during windstorms.

Premiums for mobile homes can have a wide range.

The age and type of mobile home you buy can also play a role in your home insurance rates. All mobile homes built after June 15, 1976 must adhere to the HUD code regulations, which include federal standards for design and construction, fire resistance, energy efficiency, and quality. In addition, double-wide and multiple-section mobile homes can be less expensive to insure than single-wide mobile homes.

Rates can run the gamut

There are insurance pricing factors you can't control. If you live in an area with a comparatively high crime rate, or where there has been persistent flooding, you can expect higher premiums.

But mobile home owners should pay attention to more than the cost of a policy. Some policies are comprehensive, while others cover only specific causes of loss or "named perils." Liability coverage, deductibles and coverage limits can vary from company to company and from policy to policy.

As a mobile home owner, you need to shop around for the best deal and the best policy to suit your needs.

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