To determine how much insurance
to purchase, an accurate appraisal of the home for replacement
cost should be made. Working with your insurance company is important
in this process. Most insurers recommend or require that a homeowner
insure the dwelling for 100 percent of its full replacement value.
Some homes, very unique ones such as national register-types
or very elaborate ones, cannot be insured for exact replacement
since some features are not replaceable in either workmanship,
materials or practical costs. The insurer and/or the agent is
the best source for these issues.
Coverage for personal property is
different. Most policies provide actual cash value coverage for
contents which includes depreciation, or full value contents
without depreciation. Actual cash value means that if a power
surge blows out a 10-year-old television set, the homeowner should
know what to expect. Unlike full value contents coverage, which
would essentially provide a new television set, actual cash value
coverage allows the insurance company to calculate the useful
life of the item and then depreciate the item to present value.
A depreciated 10-year-old television set would be insured for
only a fraction of its original cost. A homeowner may want to
consider replacement cost coverage to be sure that the contents
are adequately insured.
In addition to making sure that
contents are covered for replacement cost rather than actual
cash value, homeowners should purchase additional coverage for
items that would ordinarily be subject to loss limitations. Virtually
all policies cover contents loss up to the policy limit for items
that include furniture, clothing, toys, accessories such as lamps
and other items which are used for decor. Explicit limitations
are set in the policy for high-cost items such as jewelry, fine
art, furs, electronics, collectibles, oriental rugs and antiques.
If a thief comes in and steals a two-carat engagement ring, it
will not be covered well enough without what is commonly known
as a personal property rider to cover specific, costly items.
For more information on home owners insurance visit our specialist
site below.
Home
Owners Liability Coverage
Liability insurance is very important
to a homeowner's coverage because it helps protect the owner
and the family from financial disaster if someone files a claim
against the homeowner's policy, sues the homeowner or if the
courts hold the homeowner legally responsible for someone else's
injury or property damage. The standard liability limit for most
policies is $100,000, but many people believe that additional
protection is needed , especially if the homeowner has sizable
assets.
For a small increase in premium,
an additional $300,000 to $500,000 may be obtained. Liability
coverage protects in three ways: Personal liability, damage to
the property of others, and medical expenses for injury to others.
Another way to protect one's assets
is to consider an Umbrella Policy which usually adds $1 million
(or possibly more) in excess liability coverage to the homeowner's
property and automobile insurance policies. It also covers claims
excluded from most basic policies such as libel, slander, defamation
and mental anguish.
For example, most policies provide
liability coverage that covers not only accidents that occur
on the insured property but accidents that occur elsewhere. If
the family dog bites a neighbor in front of another neighbor's
house, for example, the dog owner's homeowner's policy will usually
compensate the neighbor for injuries and necessary medical expenses.
For more information on home owners insurance visit our specialist
site below.
Theft Off Premises
Most policies automatically insure
against the loss of personal property even if that property is
not on the insured premises when it is lost. If one goes to the
airport with several suitcases and they are stolen, this is probably
covered. Talk with your agent and/or your insurance company for
details.
Additional
Living Expenses
Another automatic benefit of which
many homeowners are unaware is coverage for living expenses if
the covered premises is damaged to the point of being uninhabitable.
Not only should the policy pay for the cost to repair the damage
to the dwelling, but it should also reimburse the homeowner for
the additional expenses of living elsewhere while the repairs
are being made. For more information and rates on home owners
insurance visit our specialist site below.
What
Can A Homeowner Do To Be Prepared?
How does someone find
out what is and what is not covered? Read the policy carefully.
It's not likely to be fun reading, but the good news is that
if one reads and understands his or her policy before it is needed,
this knowledge may save unexpected financial losses should a
problem occur. It is always best to talk with one's insurance
agent or the company that issued the policy for details.
Understanding your home owners insurance policy is best handled before a claim is made. In the case of
the contents, an inventory of items room by room is important
to have with information such as the date purchased, serial number,
the original cost of each item and a brief description. Video
tape or still photos is very helpful along with the inventory.
These items should be stored in a safe place such as a safety
deposit box in a bank or savings and loan institution and not
in the home because if the home is destroyed, the chances are
the inventory and related photos or tape may also be destroyed.
Save
Money On Your Home owners Insurance
Insurance is a highly
competitive business and the price paid by the consumer for homeowners
insurance may vary by hundreds of dollars, depending on the insurance
company with which the consumer intends to do business.
Companies offer several
types of discounts, but they may not always offer the same discount
or the same amount of discount. That is why the consumer should
ask his or her insurance agent or company representative about
any discounts that are available.
What should a prospective
homeowners policy holder think about when assessing which policy
to obtain? Here are several ideas for potentially lowering costs.
-
Shop Around
Prices vary so it pays to shop around. Ask friends, check the Yellow Pages,
refer to consumer guides, insurance agents, the consumer phone line of
the state's insurance commissioner's office and the companies for price
information.
-
Raise the deductible
Deductibles are the amount of money the homeowner pays toward a loss before
the insurance company starts to pay according to the terms of the policy.
Deductibles on homeowners policies typically start at $250. By increasing
the deductible to $500, $1,000, $2,500, or $5,000, discounts may be obtained,
depending on the insurance company.
-
Buy home and auto policies from the same
insurer
Some companies that sell homeowners and auto coverage may reduce their
premium if two or more policies are purchased from them. When buying a
home, consider how much insuring it will cost. A new home's electrical,
heating and plumbing systems and overall structure are likely to be in
better shape than those of an older house. Insurers may offer a discount
if the house is new. Choice of construction materials and design could
reduce the premium. Brick, because of its resistance to wind damage, is
better in Georgia. Proximity to fire station, firefighters and fire hydrants
also affects premiums.
-
Insure the house, not the land
The land under the house isn't at risk from theft, windstorm, fire and
other perils covered in a homeowners policy. Therefore, the value of
the land should not be included in deciding how much homeowners insurance
to buy.
-
Beef up home security
Some insurance companies offer discounts for smoke detectors, burglar and
fire alarm systems, or dead-bolt locks. Others offer discounts for homes
equipped with a sprinkler system and fire detection and burglar alarms
that ring at the police station or at a monitoring facility. Before buying
such a system, consumers should check with their insurers to validate
that such as system will be eligible for a discount and how much the
device or system would cost. Most importantly, the consumer should know
how much may be saved on premiums.
-
Stop smoking
Smoking accounts for more than 23,000 residential fires in a year nationwide.
That's why some insurers offer to reduce premiums if all the residents
in a house do not smoke.
-
Seek out discounts for seniors
Retired people stay at home more and spot fires sooner than working people.
Retirees also have more time to maintain their homes. If a homeowner
is at least 55 years old and retired, he or she may qualify for a discount
at some companies.
Compare the limits
in the policy with the value of the possessions in the home at
least once a year.
Policies should cover
any major purchases or additions to the contents of the home.
Remember that additions to the physical structure of the home
should be reported to your agent or insurance company for a reevaluation
of the limits of your policy. In addition, review your contents
which may require a special scheduling on your policy. Such items
include jewelry, watches, furs and computers to name a few. If
you have sold or given away special schedule items, they should
removed from your policy.
Are You Adequately
Protected?
Because there are so many options
and variables associated with home owners insurance we recommend
that you find a company in your area that specializes in home
owner insurance. It is very possible to save hundreds of dollars
a year by simply shopping rates and coverage.
For more information
or a quote on homeowners insurance fill out our free home insurance
quotes request form
Related Articles: Homeowners Insurance Tips - Homeowners Policy Needs
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