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Topic:   Knob & Tube Wiring Uninsurable? - 2662 visits (1 today, 8 this week)

wes owens
Member


Posts: 214
From:Florence, SC
Registered: Aug 2004

posted December 11, 2005 10:19 PM            

Has anyone heard about insurance companies now refusing to insure any house with knob and tube wiring?
Just curious. I read an electricians post that stated this info and was wondering if anyone else had heard it.

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Wes Owens
Absolute Home Inspections,LLC

John Ghent
Member


Posts: 354
From:Trumbull, CT
Registered: Aug 2001

posted December 12, 2005 03:19 AM            

Yes, and many also will no longer insure a house with 60amps.

Greg Bell
Member


Posts: 156
From:Titusville Florida
Registered: Oct 2002

posted December 12, 2005 04:49 AM            

Add aluminum wiring to that list also.

Jerry Peck
Member




Posts: 7895
From:Pembroke Pines, FL
Registered: Feb 2003

posted December 12, 2005 05:26 AM            

Add service equipment and panels with fuses to that list.

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Jerry Peck
South Florida

Scott Patterson
Member



Posts: 2969
From:Ridgeland (Jackson), MS
Registered: Mar 2001

posted December 12, 2005 05:32 AM            

USAA will not insure homes with FPE panels, I don't know about Zinsco. My daughter and son-in-law found this out this past summer.

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 12, 2005 11:29 AM            

And wood roofs in high fire hazard areas like all of San Diego County.

Actually, with everything on the above list, there are insurance companies that will insure houses with those things. However, the premiums typically are much, much higher. It usually is worthwhile to have all those items replaced by the seller while they still own the house and then get the lower insurance on the better stuff.

Michael Greenwalt
Member


Posts: 22
From:Milford KS
Registered: Sep 2005

posted December 19, 2005 03:08 PM            

I know here that State Farm, Farmers, USAA and others will not insure Knob&Tube or under 100 Amps. However re-wiring K&T can cost upwards of $40,000 and is simply not feasible. As stated there are insurance companies that will insure either as is or with a certification from a licensed contractor after a thorough inspection. As we have a lot of K&T around here, this is critical.

Scott Patterson
Member



Posts: 2969
From:Ridgeland (Jackson), MS
Registered: Mar 2001

posted December 19, 2005 03:43 PM            

quote:

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However re-wiring K&T can cost upwards of $40,000 and is simply not feasible.

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Keep in mind that nothing last forever. Galvanized pipes need replacing as do cast iron and clay sewer lines. I see a good amount of K&T and all of it has had crumbling and cracked insulation and some of it has no insulation.

We as home inspectors can't worry about the replacement cost, if we do it just might cloud our judgment.

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 19, 2005 04:15 PM            

Even here in high-cost-of-living San Diego, I have not seen a K&T rewiring bid "upwards of $40,000." The highest I've seen was $9,750 for a 2,300 SF house.

If someone is bidding $40,000 on a re-wiring job, that, to me, would mean that they don't want the job. As an example, I inspected a 4,000 SF house for a Realtor. It had significant foundation problems. The Realtor got bids of $17,000, $23,000, and $57,000. When she called me to get comments on the bid, I said it sounded like the $57,000 outfit didn't want the job. She said, "Yeah, they already told me that they didn't want to go all the way out to La Mesa [10 miles from where the company is located], so I thought that's why they bid high."

Recommend that your Clients get at least three bids. Then pretend like you're at the Olympics: Throw out the high and the low and take the middle one.

Vince Santos
Member


Posts: 657
From:Canton, MI
Registered: Aug 2003

posted December 19, 2005 09:31 PM            

quote:

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USAA will not insure homes with FPE panels, I don't know about Zinsco. My daughter and son-in-law found this out this past summer.

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I inspected a home for someone I work with at my regular FT job and they had an FPE panel. She told me her insurance company jacked her rate way up because of it. I told her to find out how much it would cost to replace the panel as it will be more affordable in the long run.

Ken Amelin
Member


Posts: 47
From:Cape Cod, MA
Registered: Mar 2001

posted December 20, 2005 05:19 AM            

We should be telling our clients to replace FPE panels. They are not safe.

Its insurability or the insurability of any item/component is not within anyones standard of practice or responsibility (that I am aware of).

I believe that telling someone that it may cost more to insure or may not be insurable is crossing the line into another persons expertise/profession.

Michael Greenwalt
Member


Posts: 22
From:Milford KS
Registered: Sep 2005

posted December 20, 2005 06:17 AM            

Oh absolutely, I agree, the cost of repairs isn't a consideration during an inspection. But I can't help but run figures through my head sometimes as I look at issues with a house.
Now the $40,000 cost for replacement of K&T was a figure thrown out ballpark but it isn't necessarily unheard of. For instance look at thest two, one for $20,000 and another in a lawsuit estimating between %50,000-$100,000 cost. http://mt.gov/doa/stab/pdf/warren.pdf http://ths.gardenweb.com/forums/load/wiring/msg081409221010.html
It mostly depends of course on the level of destruction necessary to meet the requirements of the insurance underwriters. Any case, I forgot to mention Met-Life, they absolutely hate K&T wiring.

As the season has slowed down, I can finally spend a few minutes reading more on this bulletin board. I really see some good information on here that has no doubt made me a better inspector. Thanks for all the help throughout the year. I hope to be able to give something back. Merry Christmas.

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And second place is wayyyyyy back there:::::

John Steinke
Member


Posts: 124
From:Reno, Nv.
Registered: Jul 2003

posted December 20, 2005 06:23 AM            

I cannot agree with the anti-FPE hysteria. Perhaps they are not my favourite panels, and perhaps they are no longer made for the US market-BUT....

Contrary to popular rumor, they NEVER lost their UL lable; they continue to be made by Schneider- the parent of Square D- in Canada, and (as documented in the IAEI magazine) the much circulated CPSC investigation bore no fruit.

Let's not throw tha baby out with the bathwater. Expecting an early panel to perform as a new one would is as unreasonable as expecting a Model T to perform like today's Saturn.

There is also the need to base your opinions on facts, and not just gossip. Just because "everyone says" does not mean "everyone " is correct. The cant against FPE is, in my opinion, exaggerated way beyond any objective look at the evidence would suggest.

As for insurance companies...well, they are probably best left to speak for themselves. Anyone checking their own car insurance rates will likely find rates that vary by as much as 400%.

In a similar manner, this very site has posted links to Canadian sources, that confirmed a point I have long made: Knob & tube is not inherently unsafe; any hazards that may exist invariably come from incompetent attempts to alter, add to, or 'improve' the system.

If you want to be critical of an older home, it is simply enough to point out that our lives have changed considerably since many homes were built, and to look for half-baked efforts to "fix" things.

Jerry Peck
Member




Posts: 7895
From:Pembroke Pines, FL
Registered: Feb 2003

posted December 20, 2005 06:52 AM            

"Contrary to popular rumor, they NEVER lost their UL lable;"

Depends on whether you are referring to the panels or the breakers. As I understand it and have read in various places over the years, "the breakers" lost their UL listing, then got it back. I'm not sure whether or not that applied to "the panels" too.

"I cannot agree with the anti-FPE hysteria."

"Hysteria" implies there is no need of basis for it. There is.

Now, if you choose to put your clients at risk, so be it. Just keep your insurance up to snuff for your electrical contracting.

I've met other electricians who feel as you do, however, by-and large, most electricians feel that SAFETY is what they are there for, and IF THERE IS ANY DOUBT, you do not use something with any type of failure history. The others, they say '*I* haven't had one fail yet', but, do they actually test the breakers for their ability to trip as required, do you?

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Jerry Peck
South Florida

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 20, 2005 09:09 AM            

quote:

---

We should be telling our clients to replace FPE panels. They are not safe.

Its insurability or the insurability of any item/component is not within anyones standard of practice or responsibility (that I am aware of).

I believe that telling someone that it may cost more to insure or may not be insurable is crossing the line into another persons expertise/profession.

---

I am knowledgable about the insurance industry here and their proclivity to either not insure a home with FPE panels (or K&T wiring or less than 100 amp service capacity) or to charge outrageous premiums for it, so I convey that information to my Clients and recommend that they start shopping around for insurance immediately just in case the seller/buyer decide on escrow credits or a lower price rather than immediately replacing the panel or other electrical components.

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 20, 2005 09:14 AM            

quote:

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Now the $40,000 cost for replacement of K&T was a figure thrown out ballpark but it isn't necessarily unheard of. For instance look at thest two, one for $20,000 and another in a lawsuit estimating between %50,000-$100,000 cost. http://mt.gov/doa/stab/pdf/warren.pdf http://ths.gardenweb.com/forums/load/wiring/msg081409221010.html

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Lawsuits, especially non-small claims court lawsuits, are rarely for the actual amount of damages. If the actual damages are $5,000, then one would want to sue for $50,000 and settle out of court for $10,000. That way, everyone is happy. Win-win.

I've seen many a home here with electrician estimates to rewire houses. K&T here typically comes in old home with nice huge attics and/or nice huge crawl spaces, so it's really not that difficult (read, not that expensive) to rewire those older homes. Of course, sometimes the rewiring won't win any House Beautiful awards.

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 20, 2005 09:22 AM            

quote:

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Expecting an early panel to perform as a new one would is as unreasonable as expecting a Model T to perform like today's Saturn.

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I thought the Model T did perform like today's Saturn.

quote:

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There is also the need to base your opinions on facts, and not just gossip. Just because "everyone says" does not mean "everyone " is correct. The cant against FPE is, in my opinion, exaggerated way beyond any objective look at the evidence would suggest.

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There's a lot of evidence out there on the Internet:
http://www.inspect-ny.com/fpe/fpepanel.htm
http://www.inspect-ny.com/fpe/fpe.html
http://www.inspect-ny.com/fpe/fpecpsc.htm
http://www.inspect-ny.com/fpe/fpetest.htm

quote:

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Knob & tube is not inherently unsafe; any hazards that may exist invariably come from incompetent attempts to alter, add to, or 'improve' the system.

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And therein lies the problem. It is much easier to incompetently alter, add to, or improve K&T systems than current systems.

Just like it's easier to incompetently get a fuse working again with a little ol' penny than it is to get a defective breaker working again.

The harder it is to incompetently alter something, the more likely it is that a qualified professional will be called in to do it right.

I believe the CPSC ran out of money and, thus, quit doing testing on the FPE panels. Additionally, by that time FPE was probably
already out of business from the billions of dollars of lawsuits against it.

Scott Patterson
Member



Posts: 2969
From:Ridgeland (Jackson), MS
Registered: Mar 2001

posted December 20, 2005 10:20 AM            

Let's not forget ZINSCO! IMO, they are worse than FPE!

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 20, 2005 10:37 AM            

Hey, Scott.

Although I have personal experience (bad experience) with Zinsco panels, I can't find any information about them like I can FPE panels. Do you have some sources?

There are a lot of electricians here who have no problems with Zinsco panels, stating that while they are old, usually they just need a good cleaning.

My own preference is to replace them but my recommendation to my clients is to have them further evaluated by a licensed electrician. If they happen to get an electrician who will sign of on it, then they might also get a second opinion. And make sure to get both opinions in writing, signed and dated on company letterhead.

Jerry Peck
Member




Posts: 7895
From:Pembroke Pines, FL
Registered: Feb 2003

posted December 20, 2005 11:30 AM            

Zinsco did not go through the reviews that FPE did, however, I also agree with Scott in that Zinsco is as bad as, if not worse than, FPE. My house had a Zinsco in it as every house in my neighborhood did. Some have been replaced, some have had fires in them, and some are still arcing along.

I HAVE SEEN (in other homes during inspections) Zinsco panels with their bus bars burned all the way through, making the panel below them inoperative as there was no power down there. And I have seen what some people do to correct that, and it is scary.

There are A LOT of old and obsolete panels which should be replaced 'just because' they are old and obsolete, however, Zinsco and FPE NEED to be replaced for safety reasons - the risk of problems with them is much greater than with other panels (and, no, I do not have back-up written documentation on that, only all the stories from other HIs and electricians and my own experiences with them).

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Jerry Peck
South Florida

Scott Patterson
Member



Posts: 2969
From:Ridgeland (Jackson), MS
Registered: Mar 2001

posted December 20, 2005 01:02 PM            

Russel, I think that Doug Hansen in CA has some articles on Zinsco. I agree they are hard to find.

Zinsco is the only panel that I have ever seen that the breakers do a pole dance down the bus bars! Not once, not twice but three times this has happened to me when I removed the dead front. I had breakers to start sliding down the bus bars. One of reasons I have considered wearing a pair of Depends during inspections!

Needless to say I no longer take the dead front covers off Zinsco!

Russel Ray
Member



Posts: 2759
From:San Diego, California
Registered: May 2002

posted December 20, 2005 01:05 PM            

quote:

---

Needless to say I no longer take the dead front covers off Zinsco!

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Nor do I or my inspectors. We treat the FPE panels the same. We consider both brands to be problematic in many respects, so we're going to recommend further evaluation by a licensed electrician who, simply because he is a licensed expert, quite probably will find additional problems. We also state that we did not remove the panel covers because of the various problems associated with them.

Craig Martin
Member


Posts: 61
From:East Dundee, IL
Registered: Feb 2005

posted December 21, 2005 06:45 AM            

I'm going from memory here, but I think I'm pretty accurate - let's not forget that Federal Pacific Electric was sued after they were sold (I believe for not disclosing problems associated with FPE breakers). They settled for around $40 million and released from any future liability. Think FPE thought there were problems with their product??? As far as the UL label - that is another story.

Craig Martin
East Dundee, IL

Byron Lentz
New Member


Posts: 9
From:Tulsa, Oklahoma
Registered: Jun 2005

posted December 21, 2005 06:42 PM            

As a part time electrical contractor, I have seen a lot of Zinsco failures, there is also a lot room to be badly installed. They have made me a lot of money in the past