Homeowner's Insurance for a Manufactured Home

The NADA Guides have appraisal criteria for manufactured and mobile homes. It is very specific and starts with the maker, model, etc. and will take into account features and upgrades on the home as well as overall condition. Our property manager uses this system and it is very straightforward when we negotiate to purchase homes.

I am not sure I understand part of your question above though. I am assuming your mortgage is going to be for the value of the home and the property. So if the home is lost to a fire or natural disaster the insurance won't pay off the value of the mortgage, because after all you still have the land. The insurance we use will insure the NADA value of the home, but our situation is a little different in that the lots and homes are not owned together.

I live in Colorado and we have had our share of fires the last 5-6 years.  Between 2 fires, approximately 1,000 homes were destroyed. Today, only about 50% have been rebuilt because owners were not able to afford to rebuild as their insurance did not have a replacement clause.  My sister bought a modular and they use one through AARP, but it is not Hartford, which is the normal company that AARP contracts with. I don't know the name of it, but I could ask her tomorrow. I'm sure they don't write just for AARP, so maybe you could check with them.  I know she had some issues for awhile as she was not happy with coverage and the cost. I'm going to ask her if she knows if her policy covers replacement and if not, maybe she too should reconsider. They've done so much to the property since buying the home. They have put in barns, sheds, and other out buildings, fences, etc.  We are able to look up our county's assessed property values on line.  Maybe you could look there or even call as most all that info is public information. We can look up by name or address and it lists assessed value of home and land separately.

Also, check into the fact that it is on a slab, that might make your insurance a little cheaper - We got our insurance through our car insurance agent at Farm Bureau. He found one for us and bundled it with our car insurance. Utilize your agent to find the best deal for you. Your taxes should break it down into land and home as well. You can go online and see what the property taxes and building taxes were for the place last year. Most county and cities have it all online.

An insurance company would not pay you for your land value. If your house were destroyed you still own the land to sell it and recoup the land value.

I can’t understand why an insurance company would pay you for land unless they take ownership of the land. That wouldn’t make sense.?

We won't write them once they are a certain age. We have an outside company we can use at that point but they too are actual cash value and not replacement cost. Insurance is a risk business and manufactured homes I'm guessing are a higher risk.

They would never pay off your mortgage unless you owe less than the home is worth. They won't pay off the land. They are higher risk because they are more prone to burn completely if they catch fire. They also start depreciating immediately. It's all about the risk the insurance company is assuming. I personally would not ever consider buying a mobile/manufactured home. It's a risk you are going to have to decide if you are willing to assume.

The prefab/manufactured homes still don't have good coverage. My son found this out when he tried to buy a house. They wouldn't issue the mortgage on it because of that. He quickly backed out of that and bought "regular" home.