Posts Tagged ‘homeowners insurance policy’

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Your Guide to Understanding your Homeowners Insurance Policy

Friday, June 11th, 2010

Your homeowner’s insurance policy sits in your filing cabinet, safe and sound. You know you have a policy; you know you chose a good, solid policy; and you know that you always pay your premiums.

But do you really know what is in your policy and do you fully understand your rights and obligations under your homeowner’s insurance policy?

If not, then you’re not alone. Most homeowners, in fact, do not take the time to really understand the ins and outs of their homeowner’s insurance policy. And we all know the saying: what we don’t know can hurt us.

With that said, it is probably a good time to pull that policy from your filing cabinet and begin to read it so that you develop a clear understanding of the policy and what is contained in it. Along the way you may have difficulty understanding the policy because of the language used.

We have therefore set up a quick guide so that you can understand your homeowner’s insurance policy so that you can make better decisions regarding your policy:

  • Damage to House - Ever wonder what it means when it says “damage to house?” This part of the policy essentially covers any damage to the house itself. The damages that you can claim on your house are up to the face amount of the policy. In other words, if the face amount of your insurance policy is $200,000, you will receive that much if your home is completely destroyed.

  • Other Structures - Other structures in a homeowner’s insurance policy usually means outbuildings, such as detached garages, sheds and fences, just to name a few.

  • Damage to Personal Property - In addition the structure itself, your homeowner’s insurance policy also covers the contents of your home. Such personal property that may be covered includes: furniture, clothing and personal effects. Highly valuable items, such as jewelry and antiques, may need to be covered under a separate policy.

  • Comprehensive Personal Liability - This type of protection covers you from any accidents incurred by other people while on your property. Your homeowner’s protection for comprehensive personal liability will cover you, regardless where you go.

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Have you Reviewed your Homeowners Insurance Policy Lately?

Thursday, June 3rd, 2010

We’re all guilty of it. We get our homeowners insurance policy, pay the monthly premium, and then forget about it.  However, this may not be the best strategy, as it’s usually not very pleasant to find out that you’re not properly insured until a crisis happens.

It is important, regardless of where you live in the country, to take the time to review your homeowner’s insurance policy on a yearly basis. It doesn’t take long, and it could save you big in the event of a catastrophe.

Here’s what you’ll need to do:

  • Make sure you have the coverage needed. It is important to review your policy each year to ensure that your home and your possessions are adequately covered in the event of a disaster. In other words, make sure your policy covers you in the event of a total loss.

  • Pay close attention to policy limits and exclusions. Not all homeowner’s insurance policies are created equal, so check your policy to make sure that the exclusions and policy limits of your policy are reasonable and that your deductible is manageable.

  • Don’t assume your homeowner’s insurance policy covers all natural disasters. Ask your homeowners insurance company about natural disasters, such as floods and hurricanes. If your policy doesn’t cover these disasters (most don’t), take out another policy that will.

  • Update your home’s inventory. It is always best to have an updated inventory of the contents of your home in case you need to file a claim with your insurance company. It is often convenient to videotape the rooms of your home and narrate the contents, including their dates of purchase and their purchase price. Then, keep the video somewhere safe; preferably in a fireproof safe or safe deposit box.

  • Search several websites to ensure that you are still getting the best price for your homeowner’s insurance policy. But remember, cheaper isn’t always better! Take care to make sure that you are receiving a competitive rate on your policy, and that the company your policy is under is reputable and financially stable.

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Understanding Fire Insurance

Thursday, May 20th, 2010

Most homeowners and renters have some kind of fire coverage if they carry an insurance policy. For those who do not have the coverage, it is something you might want to seriously consider. Fires can strike anytime, anywhere, without warning. If you are lucky to come away from it with your life, you will most likely have lost much or all of what you owned before. Fire insurance can ensure that you have the coverage to get back on your feet and replace what you had.

Understanding Fire Insurance

Even those who do have the coverage do not often understand what fire coverage really is and how it works. After all, no one really expects a fire, nor is the insurance used by every individual who has it.

Most fire insurance policies consist of at least four parts: coverage for your home, coverage for outlying structures (not attached to the home), your personal property, and loss of use or living expense coverage (allowing you to get back on your feet and find another place to live either during repairs or permanently).

Most fire policies do limit the amount of coverage, so if you have additional valuables, such as jewelry, furs, etc. You might want to consider housing those in a safe place where there is little risk of fire or get yourself additional endorsements on your insurance policy. It is an important thing to consider, especially if you are someone who would prefer to rebuild rather then to move elsewhere permanently. If your dwelling was older, your city might require code upgrades. In this case, the insurance company coverage cap might put a damper on repairs without an additional endorsement.

All Your Stuff

Whether it is with a video camera or snapshot kind of camera, catalog everything that you own. If you own the property and the dwellings, document it. Go through the house and document all your personal property, in writing and on video or in pictures. You need to know what you have and what it is worth and so does the insurance company. This will benefit you a lot if you ever have to file a fire claim. Once you do this, ensure that your insurance company has a copy and give one to a family member or put one in a safe deposit box.

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Homeowner’s Insurance: Home Inventory Tips

Monday, April 19th, 2010

When you purchase a homeowner’s insurance policy, one of the most important parts of that policy is up-to-date documentation of the things that you own. If you own many items, it can seem like an overwhelming task to take inventory of each and every little thing that you want covered by your policy. Sure, it takes some time and effort, but it is well worth every second in the event of theft or some other disaster that takes away or destroys the possessions you cherish so much.

Sure, it is doubtful that every little thing could be replaced, especially those things with sentimental value, however, you can still benefit from insurance by not having to spend out of pocket to replace some of your more expensive treasures. After all, you probably worked pretty hard to buy those things in the first place. Here’s a few tips for taking a home inventory that will make things a lot easier in the long run.

Inventory

You can print off a checklist from some websites or get one from your insurance company. However, it is also advisable to just go from room to room and start making a list of what you own. Be sure to include any serial and model numbers, brand names and other pertinent info. For major purchases, hang onto the receipts in case you need them later on to prove ownership or purchase price.

Spreadsheet

With today’s programs like Excel and other spreadsheet software, you now have a great tool to track your items and easily update the list. Prepare a spreadsheet listing the item, the brand, the make /model/serial number, location within the home, purchase date and price, replacement cost/depreciated value and any notes you feel are important about the item.

Photos

Take photos of everything. Take several, in fact. Capture the item itself on file, serial numbers and other info and even distinguishing marks.

Backup

Print hard copies of your spreadsheet and photos. With your receipts, keep the originals, but make copies of them as well. It is also good if you can scan them into your computer. Back everything up on CD or flash drive, that way, you always have a copy.

The Insurance Company

Provide the insurance company with a copy of your home inventory list and photos, as well as receipts, if you choose to include those. This will go into your file as a permanent part of you policy, as long as it is active.

Updating

If you buy something new and want it covered, update your list and add a new photo or set of photos. Make sure the insurance company is made aware of the update too. Remember to delete any items you no longer own and let the company know that as well.

The good news is that if you follow these steps, you will only have to do a major home inventory one time. Updating the list will then be as easy as 123 and everything you own will be covered in the unfortunate event of a loss.

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Protecting Your Home and Everything You Own

Friday, March 19th, 2010

The majority of us work extremely hard for what we have. We take pride in our homes and the things we have acquired through the years. It doesn’t make us materialistic; simply happy to have what we have. However, disaster and chaos can strike at anytime, often without warning. The prospect of losing everything, or even a portion of everything, is certainly not a pleasant thought. What can you do to prepare for the worst?

Homeowner’s Insurance

If you own your home, homeowner’s insurance is a great thing to have. More often than not, your mortgage company will demand carrying of a homeowner’s policy as part of the terms and conditions for your mortgage. Homeowner’s insurance can take care of everything from minor repairs to major repairs and replacement of things contained within the home. You will, of course, have to take inventory of your valuables (including pictures) for them to be covered by the policy, but it’s well worth the time and energy spent to know your losses will be covered.

Homeowner’s policies typically cover theft and disasters. Should a burglar break in, you can count on your policy to reimburse you for the things that were taken. Should you spring a leak, your homeowner’s insurance is there. Most natural disaster’s will be covered too, however, there are often loopholes that preclude certain disasters, flooding being a popular example. Nevertheless, you can often add-on to your policy with disaster-specific insurance to ensure every possibility is covered. Homeowner’s insurance will also cover accidents that might occur involving guests on your property on inside your house.

Renter’s Insurance

You’re a renter, therefore, your landlord carries the homeowner’s insurance, so you don’t need to have insurance, right? Think again. The landlord’s policy is not going to cover the loss of your personal property or any accidents that occur within your home. for a small price, you can get a renter’s policy that will cover your belongings, guest accidents, and certain disasters that your landlord’s policy won’t cover, keeping you protected. It’s a small price to pay to wipe extra worries away.

Whether you own or rent, it is always a good idea to carry some kind of home insurance coverage to ensure that all your assets are always protected.

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Important Steps to take if your Home is Damaged in a Storm

Friday, February 12th, 2010

The next time the wind is howling and the rain is pelting against your windows, you may be in for a big surprise, as often strong storms can lead to a damaged home.

Once the storm has cleared and you are able to clearly see the extent of the damage, you must act immediately so that you can be assured that you are covered under your homeowner’s insurance policy. In other words, if you delay filing a claim, you may be out of luck when it comes to recovering money for your damaged home.

Here are some helpful tips for taking care of business if your home becomes damaged by a storm:

  • Pull your homeowners insurance policy out and carefully read the policy’s terms and conditions so that you can be sure that your policy covers your specific type of damage. For example, a leaking rook would likely be covered, but a flooded basement likely would not.

  • Call in a contractor to assess the damage and provide you with a repair estimate. It is important to get a quote (or several, if necessary), so that you can make the determination regarding whether your damages exceed your policy’s deductible. In other words, it doesn’t make much sense to contact your homeowner’s insurance company and begin the tedious process of filing a claim if your damages amount to only a few hundred dollars.

  • Once you have received a quote, it is time to make a call to your homeowner’s insurance company. However, think hard about whether you want to make a claim, as this could potentially raise your homeowner’s insurance rates. In other words, if the damage is minimal and your homeowners insurance would only cover a few hundred dollars, you may be better off paying for the damages out of pocket and forgoing the process of filing a policy, as the increase in your homeowner’s insurance premiums will likely exceed the damage amount.

  • Don’t forget to take pictures of the damage and keep all receipts and repair paperwork so that you have a clear paper record of the damage and the subsequent repair.

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What you need to Know about Home-Based Businesses and Homeowners Insurance

Thursday, February 11th, 2010

Did you know that your homeowner’s insurance policy may not cover your home-based business?

If not then you are among the majority of people who don’t realize that their homeowner’s insurance policies may not cover losses incurred with their home-based business. With that said, you can secure additional insurance to protect your business from nearly anything from theft and property damage to employee protection and liability.

Your home-based business should not rely solely on your homeowner’s insurance policy, so it is important to consider commercial insurance to protect yourself, your employees, your business and your assets from a variety of misfortunes.

As a small business owner with a home-based business, here are a few types of commercial insurance policies to consider:

  • Business interruption - If you are unable to operate your business due to a natural disaster, commercial insurance may cover your losses for a specific length of time.

  • Crime - If your home-based business is affected by criminal activities, such as theft, vandalism or even computer hackers, your losses may be covered under a commercial insurance policy.

  • Disability - If you have an employee who can not work due to an injury, your commercial insurance policy may pay a portion of his or her salary.

  • Product Liability - If you sell products then it is probably in your best interest to carry product liability insurance. Product liability insurance can protect you and your business from negligence claims that result from your products.

  • Property and General Liability - General liability coverage protects your business and your assets from natural disasters, as well as bodily injury, medical expenses and legal costs.

  • Internet-Based Business - Internet-based businesses can take out coverage that protects their business from damages incurred by hackers and electronic copyright infringement, among other things.

Don’t let your home-based business become jeopardized because of a lack of proper commercial insurance. Talk to your insurance agent about the extent of your homeowners insurance and get the appropriate commercial insurance to protect yourself, your business and your employees.

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When to Contact your Homeowners Insurance Company

Tuesday, February 9th, 2010

We all want to make sure that we have the best, most comprehensive homeowners insurance so that we can be sure our home, our valuables and our families are adequately protected in case of a home-related disaster or injury.

But many of us simply don’t take the time to consider the many things that can affect our homeowner’s insurance rates. In particular, the homeowner’s policy that you originally took out years ago may not work well for you today.

So, the question is: are you adequately protected? The only way to make sure that your homeowners insurance is still adequate is to contact your homeowner’s insurance agent on a regular basis; at least every two to three years. In addition, it will probably benefit you to contact your homeowner’s insurance agent when:

  • You perform extensive renovations, improvements or upgrades - Any remodeling or renovation projects that add to the value of your home should probably be reported to your homeowner’s insurance company. In addition, take pictures, keep receipts and even video record your new improvements so that you have proof should you need to file a claim. Some of the reasons you may contact your homeowners insurance company include: deck, finished basement, addition or large remodel, such as a bathroom or kitchen.

  • You purchase expensive artwork, jewelry or antiques - The addition of expensive personal effects to your home will probably require an additional policy rider. Since most homeowners insurance policies do not cover such expensive things as jewelry and antiques, your homeowner’s insurance agent will probably recommend an extra policy to cover these items.

  • You install a swimming pool, hot tub or trampoline - Any type of outdoor recreational item that may create additional dangers should be reported to your homeowner’s insurance company. In the case of trampolines, some homeowners insurance companies do not even allow them because they pose too big of a liability issue. Don’t get caught with inadequate homeowners insurance should a guest become injured in your swimming pool or on your trampoline! Be prepared and always provide this information to your homeowner’s insurance agent.

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Practical Homeowners Insurance Tips to Remember

Tuesday, February 9th, 2010

One of the first things you must do when shopping for a home is to shop around for the best homeowner’s insurance rates. Many individuals, excited about the whole home buying process, tend to neglect the important of a comprehensive, affordable homeowner’s insurance policy. However, a homeowner’s insurance policy can be your saving grace should your home become damaged or completely destroyed.

With that said, there are a number of practical tips that all homeowners should remember when it comes to homeowner’s insurance:

  • Always check the company and research the agent’s qualifications before purchasing homeowner’s insurance. Make sure that you understand your agent’s qualifications, and that you have a good rapport with him or her.

  • If homeowner’s insurance rates are too steep for your budget, consider raising your deductible to lower your rates. Also keep in mind, however, that a larger deductible will equate to more out-of-pocket expenses should you need to file a claim.

  • Remind your homeowner’s insurance agent about items that can lower your premiums, including fire extinguishers, deadbolts, smoke detectors and home security systems.

  • Consider updating your home to better withstand weather conditions (and prevent homeowner’s insurance claims); this may include stronger roofing materials, better windows and a newer electrical panel.

  • Ask your homeowners insurance company if they provide automatic payment systems or web payment systems; these will make the process of paying your homeowners insurance easier, and may allow you to receive rate discounts from your homeowner’s insurance company.

  • Make sure you have adequate coverage, including replacement cost value. Make sure your valuables, such as antiques and jewelry, are also covered (these may require a separate policy).

  • Consider video taping your home for home inventory purposes. Walk from room to room, properly recording all furniture, electronics and personal items and store the videotape in a separate, safe location, such as a safety deposit box.

  • Consider purchasing separate insurance, depending on where you live. For example, you may want to purchase flood insurance if you live in a low-lying area, as standard homeowner’s insurance policies typically don’t cover flood claims.

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Your Common Homeowners Insurance Questions Answered

Thursday, January 28th, 2010

Homeowners insurance is more than just a requirement for a home loan; it is a must for all homeowners who want to protect themselves, their families, their home and their assets.

Don’t take your homeowners insurance policy for granted, as it may one day protect all that you have worked so hard for. With that said, there are a number of common questions homeowners have when it comes to homeowners insurance:

Q:  Does my homeowners insurance cover natural disasters?

A: Perhaps. Certain natural disasters, such as wind or hail damage, are typically covered by most homeowner’s insurance policies. However, natural disasters such as earthquakes and floods are not. The only way to find out what disasters are covered by your homeowners insurance policy is to read the policy. Both flood and earthquake insurance policies can be purchased through the federal government.

Q: Does my homeowners insurance protect my most prized possessions?

A: This is a gray area. Your homeowners insurance should be adequate enough to cover the assets within your home; however, if you have many possessions that are of significant value, such as jewelry and antiques, it is best to take out additional insurance to cover their value.

Q: Will my homeowners insurance provide me with enough money to rebuild in case I lose my home to a fire?

A:  Again, perhaps. There are two different types of policies you can take out: the replacement value or the current value. In other words, if you take out only enough insurance to cover the cost of your home, this may not be enough to build anew home; in which case you would fall short of rebuilding your home. Make sure your policy is written as such as provide you with enough money to rebuild your home and replace its contents.

Q: Where can I shop for homeowners insurance?

A:  Homeowners insurance can be purchased through your local insurance company or it can be purchased online. There are many websites that allow you to get online homeowners insurance quotes and also compare costs between insurers. Many times, purchasing homeowners insurance through the same company who carries your auto insurance policy can save you money, as many insurance companies offer multi-policy discounts.

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