MDT at Paragon Home Inspections, LLC wrote:
One problem with K&T is that whatever the condition of the original
material, it's seldom properly connected to more modern wiring:

http://www.codecheck.com/images/CCWe18.gif

and every incorrect junction is a potential problem.

Another is that users may overload K&T circuits - a single K&T circuit
often serves potential loads that would be split between multiple
circuits in a more recenly installed system. In my area it's not
unusual to find a single K&T circuit powering all the lights and
receptacles in three or four bedrooms and a bath on a top floor, but
power demands have increased (no window ACs back then!) and users many
be tempted to "overfuse" such circuits in an attempt to supply
sufficient power to loads at multiple locations on a single circuit.

So depending on the situation, when you have electrician throughly
inspect a K&T installation and identify existing defects you will often
find it's also desirable to pull additional circuits to meet modern
demands - in which case it's likely not all that much more expensive
to bypass the K&T with new circuits entirely.

Michael Thomas
Paragon Home Inspection, LLC
mdt@paragoninspectsDOTcom
847-475-5668

.
I agree with all of this but the most dangerous part are comnnections
buried in walls where they cant be inspected and may catch fire under a
long list of possible reasons.

insurance has good reasons for their rules...........