Embedded home insurance is a powerful way to remove an increasingly troublesome closing risk.
Consider: In a single month in 2024, a record was set when 60,000 homebuyers canceled their home purchase agreement. The culprit? The editors at Insurance NewsNet suggest, “Insurance might not have been the only reason for the high number of cancellations. But experts believe it was a major factor.”
1. Embedded Home Insurance
Small wonder so many builders now rely on embedded home insurance to help reduce missed closings. Meritage Homes (#5 on the 2025 BUILDER 100) is a good example. Several years ago, they collaborated with Westwood Insurance Agency to create Meritage Homes Insurance Agency, lowering closing risk and simplifying home buying for their customers. Westwood, founded by a home builder, helps provide home insurance for more than 100,000 new home closings each year and represents more than 40 high-rated insurance company partners.
“The economics of the embedded option have exceeded our expectations,” reports Brian Hall, president of financial services at Meritage. The 30-year home building veteran says, “Working with Westwood, our in-house insurance agency pre-underwrites our homes so the buyer has an insurance quote before they purchase. Home insurance is in the news a lot these days. Insurance pre-qualification helps remove the uncertainty around obtaining insurance.”
2. Site Location Information
If an embedded insurance solution was all an insurance agency offered, that might be enough in a challenging market. But for home builders like Meritage the value-add of their Westwood relationship goes much farther.
Take the rising frequency of extreme weather across coastal states and the Midwest. Meritage and other home builders now look to insurance experts like Westwood for site location guidance.
“In the last couple years, the conversation around weather risk is common. ‘Do we buy lots here? Or buy there?’ is being asked more frequently. Home insurance is a determining factor in many markets,” Hall says. “Discussions around insurance availability and cost are significantly more prevalent today than they were even just a few years ago.”
Westwood’s growing advisory role can help home builders steer clear of development areas that may present insurability problems today or in the future. Tom Kriby, vice president of client development and partnerships at Westwood, has seen firsthand how critical that guidance can be.
“We recently assisted a very large builder with a land review in their Sacramento division,” explains Kriby. “They came to us looking for guidance on land evaluation and potential home insurance costs. We worked with our insurance company partners to review scores from five disaster risk models, and they made a land purchase which took into consideration the information we provided.”
3. Resilient Construction
Meritage goes even further to address the new normal presented by weather and home insurance. “California is our most complicated market,” reports Hall. “But even inland areas in Colorado and Texas represent risks from hail and wind.”
That means turning to the resilient construction playbook and a trusted insurance agency like Westwood for recommendations.
Meritage is already well down that risk-aversion path. “Meritage carefully assesses the cost of insurance when underwriting, which is particularly important for our primarily entry-level customers. It has become a critical discussion our teams have before every deal,” Hall asserts.
The builder is also advancing a pair of demonstration homes in California (fire) and Florida (wind) to show the real-world value of resilient design and construction. “We want to show industry officials what’s possible through resiliency,” Hall says.
Today it’s a game-changer to know there are strategies, techniques and insurance experts like Westwood available to help builders minimize insurability risk and ensure buyers can move confidently forward on their home purchase with pre-qualified insurance certainty.
Learn more about how teaming up with Westwood Insurance Agency helps reduce the risk of missed closings and insurability concerns as it helps buyers lock up quality home insurance protection with simplicity, value and confidence.
