Homeowners Insurance
What is Homeowners Insurance?
Homeowners Insurance provides you with the coverage in case of a disaster. In the event of a disaster your homeowners insurance will provide you with financial protection. A homeowners insurance policy insures the home in which you live along with the possessions you keep in it.
Home Insurance is a Package Policy
Homeowners insurance is purchased in a package policy. A package policy means that it covers both damage to your property and your liability or legal responsibility for any injuries and property damage you or a member of your household cause to other people. Homeowners insurance also covers damage caused by household pets.
A homeowners insurance policy covers most disasters, however there are some exceptions such as floods, earthquakes and poor maintenance (Also known as wear and tear). If you want coverage for floods or earthquakes, you will have to purchase separate policies. However, maintenance related problems are the homeowners responsibility to take care of. In fact, keeping up with the maintenance of your home will help to reduce the likelihood of a loss in the future. A good example of this is the replacement of a roof that is showing signs of wear.
Overall it is very important to have homeowners insurance coverage that suits your specific needs. You never know when a loss is going to occur and you are going to need the money to fix it. Take Hurricane Katrina for example; there were many of people that were without homes because they didn’t have flood insurance. That is why it is very important that you get the proper coverage.
Remember that standard homeowners policies do not cover flooding so you will have to purchase that separate through your homeowners insurance agent. Discuss all of the possible exposures with your agent, broker, or insurance company.
Replacement Cost
Replacement cost coverage is available for the structure of your home; This allows you to repair the home to the state that it was before the damage took place. Actual cash value coverage is replacement cost less depreciation. The older your possessions are, the less you will recover from the homeowners insurance company.
Renters Insurance
Not only is insurance coverage available for homeowners it is also available for the people who rent apartments or houses. If you rent a house and you have a renters insurance policy, you will be covered in the event of a loss. The coverage for a renter is relatively inexpensive and will cover your property, your liability, and loss of use of the home due to a covered loss.
Coverage Types
The standard homeowners insurance policy includes four different types of coverage.
1)The coverage for the structure of your home is offered by the homeowners insurance company. This means that they will repair or rebuild your home in the event of a covered loss.
2)The coverage for your personal belongings that you have in your home is also covered by the homeowners insurance company. This means in the event of a claim that is covered by your insurance policy, your personal belongings will be able to be replaced. Note: It is a good idea to carry replacement cost coverage for your contents. This way, your items are not depreciated if there is a loss. With replacement cost coverage, your property can be replaced with items of like kind and quality.
3)Liability protection covers you in case of a law suit against bodily injury or property damage that you are your family members caused to another party.
4)Additional living expenses if you are temporarily unable to live in your home because of an insured disaster.
There can be more to a home insurance policy and there are limitations for certain types of property. It is best to discuss these options with a representative at the time your are applying for coverage.
Homeowners Insurance Company: How To Choose One
It is almost inevitable that when purchasing a new home the homeowner will be required to also purchase a home insurance policy. Many mortgage companies who are granting the mortgage loan will require that proof of the Homeowners insurance policy be shown before the closing on the house. This ensures that their investment into that home is safe in case of damage or destruction.
There are an overwhelming number of Homeowners insurance companies to choose from, making it difficult to determine what is right for you and your home. Many mortgage companies will suggest a Homeowners insurance company that they work in conjunction with, but this does not mean you have to use that insurance company to cover your home insurance needs.
Before jumping in and accepting the first quote that comes along, it is best to call around to a few different insurance companies and see which coverage plan is right for you, since different companies will offer different plans and different discounts.
The first thing you should ask about when determining which insurance company to use is whether they offer special discounts. Depending on the company you may find discounts ranging from fire resistant, security system discounts to senior citizen or dual insurance discounts.
A dual insurance discount usually means that you will receive a discount from the company if you have more than one type of insurance through them, so check with your current car insurance company to see if they offer special rates to loyal customers.
Keep in mind that in a similar fashion as creditors looking at your previous credit history, insurance agents will be looking at your credit history as well as your past insurance history. For those who may have a high car insurance crash history or for those who have a bad credit history, this could mean higher premiums in the long run.
Insurance companies are taking a gamble on you and although they assume that they may have to help replace something in your home along the way, if you are already a “high risk” client, this means you will have to pay for those risks because it is more likely their services will be needed sooner than later.
Most basic Homeowners insurance policies will cover the house for a total replacement cost as well as the possessions of the home for a total replacement cost. Because of this, insurance agents will be asking in depth questions about the home you are about to purchase such as square footage, the age of appliances, the air conditioning and heating units, the age of the plumbing and electrical system, and even the style of flooring, countertops and cabinets.
Although you might want to try and save money by stretching the truth about the age of the plumbing system or the style of the countertops, remember that you will only receive the replacement costs for what you have told the insurance company, so it is important to be as accurate and truthful as possible.
Many insurance companies will include in a quote special needs perils such as flooding, hurricane or earthquake insurance. Nevertheless, if you know you live in a high risk area for any of these particular perils it is best to ask if those are covered under the basic policy. You dont want to get started on an insurance policy and realize that you are not fully covered.
The same can be said for special possessions like computer equipment and jewelry or furs. Often times a separate policy or a clause in the policy is needed to insure any special possessions for their full replacement cost, so be sure to ask the insurance company about these items.
All in all it is most important to find a Homeowners insurance company that is reliable, has a reputable name and has been in business for a long time. This may mean asking friends or family members who are current homeowners who they use for their home insurance, or even searching ratings for the best Homeowners insurance companies.
Remember that they will have a large portion of your financial investment and the possessions inside in their hands, so it is important that you feel confident in the policy and company you select.
Best Homeowners Insurance Rates – How Can You Get Them?
Best Homeowners Insurance Rates – How Can You Get Them?
Rating of Homeowners insurance depends on various factors. The most knowledgeable buyer usually finds the best home insurance rate. To get the best homeowners insurance rate, you should do a bit of research work. If you cannot time yourself for it you can of course seek professional help. This approach is timesaving but you have to be cautious about your advisor.
Here are some tips to get the best homeowners insurance rates.
1. First of all you should get the basic understanding about your home insurance rate and the different policies. You have to know who regulates the rate. It is the individuals of an insurance company who decide on the home insurance rates and these rates are regulated by the insurance department of the state. The state insurance department is the approving authority; it is only after their approval the rates can be passed on to the customers.
2. Before applying for homeowners insurance, you should shop around, so that you get the best homeowners insurance rates. To maximize your options you should make a search of your own. Enquire with your local bank, lenders and credit unions. Today, many banks have official websites; you can send your enquiry online. After completing your search, compare with those available in the advertisements. This will make it easier for you to get the best deal.
3. Some insurance companies provide more than one kind of insurance policy. For example, they will give you better rate if you buy auto policy along with home insurance. It also helps you get better home insurance rates.
4. Many insurance companies are associated with security companies like Brinks or ADT, these companies offer you better rates if you install a home security system.
5. Not only better rates, you can even get discounts if you are ready to install motion sensors or video surveillance cameras in your home, provided by the associate companies of home insurance company.
While keeping these points in your mind, you can get the best homeowners insurance rates.
Homeowners Insurance Discounts: The Best Methods Of Finding Them
There is no way around needing Homeowners insurance if you are about to embark on the journey of purchasing a home. Depending on the size of the home, Homeowners insurance can cost as little as $400 a year to as much as $2000 a year, if not more in some parts of the country. The amount of Homeowners insurance you receive will also be determined by the value of the interior property, including the upkeep of remodeling on the home, as well as whether your policy will include valuable electronics and jewelry.
Once you have determined what type of policy you would like to implement, you can begin discussing yearly and monthly costs with insurance agents. One thing to keep in mind while you are searching for Homeowners insurance is that the rates wont vary that much between each company, but there are small ways to save a few dollars to a few hundred dollars, simply by finding some Homeowners insurance discounts that are available.
One of the easiest ways to receive a discount on Homeowners insurance is to install a home security system, and not the type that barks and growls. Many insurance companies are actually paired up with security companies like ADT or Brinks and will give you a discount for using that insurance company and that security company as well.
Even if you get Homeowners insurance and decide to go back later and install a security system, dont forget to go back and call your Homeowners insurance company once the system is installed so that you can receive a discount on your insurance. Further discounts may be given for motion sensors or even for video surveillance cameras installed on the home.
Another great way to receive a small discount on your Homeowners insurance is through fire and carbon monoxide detectors and fire resistant doors, brick and even walls. Remember that not all companies will offer the same discount for fire resistance and fire protection, so it is best to do research on how much of a discount can be received before diving in to remodeling the entire house for fire resistance.
Keeping up with newer appliances is another excellent way to help receive a Homeowners insurance discount. Older appliances are more likely to develop bad electrical connections, which can make the home susceptible to fire.
The first place to begin updating appliances is in the kitchen because kitchens are on the top of the list for places where fires begin. Many other insurance companies will offer a discount for new plumbing and electrical systems, or simply for a home that is less than ten years old altogether.
While some homeowners arent willing to consider a higher insurance deductible, or the price they will pay before the insurance will begin paying for loss or damages, asking for price quotes with higher deductibles is an excellent way to receive a discount on your insurance.
Most Homeowners insurance companies start out with a minimum deductible of $250 to $500 dollars, but try raising the deductible by $250 and see how much this will save you a year. Often times, this can make a difference of nearly $100-$150 a year on the total insurance bill.
Remember, though, that if you choose this route, you may end up paying more than that $150 savings a year if something happens to your home and you have to pay the higher deductible. Simply weight the negatives and positives and decide if a higher deductible is right for you.
The final sure fire way to receive a Homeowners insurance benefit is to belong to a club or certain group. This could simply mean being in the “65 and older” club and receiving a senior citizens discount, or it could also mean already being a member of the bank where you are looking to purchase Homeowners insurance. Some insurance companies also give a discount if you plan on having both your car insurance and Homeowners insurance with that company.
Before settling for the first set of numbers thrown at you by the insurance company, be sure to ask about these discounts and make your assets work for you when shopping for Homeowners insurance.