If you haven’t noticed, there’s a tiny house movement, spurred on by shows such as HGTV’s Tiny House, Big Living and Netflix’s Tiny House Nation, which inspire homeowners today to downsize their home space to fit their lifestyles and teaches them how to create them using the latest space-saving and design-savvy ideas.
Why are tiny houses so popular? It’s not just about the adorable small home you’re buying at an affordable price. Some tiny house dwellers managed to build their downsized dream home for as little as $8,000. And Tiny Home Builders sell homes ranging in size from 16 feet to 32 feet long for prices between $28,700 to $44,500.
But before you get swept away with the idea of moving into your own tiny house and heading south for the winter, there are special considerations as far as home insurance goes. After all, you’ll want to protect your investment, whether it’s $8,000 or $45,000.
What Is a Tiny House?
Tiny House Living is a movement that focuses on simplifying your life, getting rid of the clutter (and the need to get into debt) and creating a smaller carbon footprint. There’s great freedom to living debt free and “stuff-free”. For many, however, the freedom includes the chance to move around with their tiny house in tow. Some tiny homes can be transported, much like you would an RV.
The Minnesota Department of Labor and Industry released an informational sheet on what classifies a tiny house, and many states are following suit. The state recently added a section to Minnesota’s residential building code, known as Appendix Q, describing a tiny house as, “a dwelling 400 square feet or less in floor area excluding lofts.” The sheet continues on to explain all the code requirements a prefabricated tiny house must meet to comply with the state’s residential code.
But not all tiny houses are fixed in place. Some tiny houses are fitted with wheels and can be towed wherever you decide, making this lifestyle even more attractive to younger generations, as well as those ready to retire and explore the continent.
Can I Insure My Tiny House?
“Insurance for tiny houses is kind of a collision of opposing forces,” says Michael Giusti, an insurance analyst at InsuranceQuotes.com. Tiny houses are all about breaking with tradition and rewriting rules. Insurance is all about strictly defining rules to understand potential risks. When you need insurance for a tiny house, the devil is in those rules.”
As Giusti mentions, there are rules you need to follow in your quest to break free. If your home is prefabricated and displays a construction seal certifying that the house was built according to code, insuring your tiny house is fairly simple.
To confirm the tiny house can be insured without too much hassle, look for the construction seal. You can typically find the plate or decal under the kitchen sink. If it’s not under the sink, be sure to ask the manufacturer or the person you’re buying the tiny house from where the seal is located. The plate includes important information such as:
- Date of manufacture
- Company, name and address of manufacturer
- Type of construction
- Model number
- Design loads
- Building codes
- Label and serial numbers
Tiny House Insurance
If your home meets local building codes and displays a construction seal or plate, you can purchase a regular homeowners insurance policy for your tiny home. You’ll probably save considerable money insuring a tiny house because your replacement cost limits will likely be much lower than a larger home and its contents.
But if your home is not purchased from a manufacturer and you build your own tiny house, you’ll need to take a few extra steps before you can insure it. According to Giusti, the tiny home must be “inspected by the county and adhere to zoning rules, among other things. If all checks out, then maybe a homeowner’s policy would work.”
Before you go out shopping for your next tiny house or building your own, Giusti advises you “have a serious conversation with your insurance agent and get a plan before investing time, money and energy into the home.”
Tiny House on Wheels Insurance
Insuring tiny houses on wheels gets a bit more complicated because they’re not always considered a house. According to the Minnesota residential code, a mobile tiny house is considered “temporary living quarters for recreational, camping or seasonal use but not as year-round dwellings.” In addition, “these trailers are often constructed to ANSI standard (A119.5) and are self-certified by the manufacturer.”
In Giusti’s experience, “If it can be moved it will likely need to be classified as a mobile home or RV. To be insurable, it would need to be certified as one of those things.” If your tiny house can move, it may be considered a recreational vehicle (RV) more than a home. You’ll need RV insurance instead of a homeowners policy.
There’s an issue, though. Many RV insurance policies don’t allow you to live in your mobile tiny house year-round. Fortunately, there are insurers that offer full-time RV insurance, allowing you to live in your tiny home on wheels year-round.
The Bottom Line
The tiny house movement looks like it’s here to stay. If the idea of living small for a bigger, richer life sounds about right to you, you’re among a growing number of people who agree. Just remember the practical side of tiny house living, such as insurance. Giusti puts it best: “The allure of a tiny home is to break all the rules people take for granted and live on your own terms, but to insure a tiny home, there are a lot of traditional rules that still need to apply.” As long as you know what the rules are beforehand, you’ll be golden.
Photo by Tony Anderson / GettyImages