Owning a home is a huge undertaking. It involves a big investment and a lot of responsibility. It is imperative that you protect your investment by obtaining homeowner’s insurance. This will help reimburse you in case your house sustains damage, you are a victim of theft, or someone visiting your property sustains an injury.
A lot of renters do not think about buying renter’s insurance. In the event of a fire, for example, you own belongings would not be covered under insurance your landlord carries. You need to get your own policy to cover your stuff in the event of a fire, flood, or even burglary.
To lower the annual insurance premiums on your home, increase your deductible amount. Although this means that minor claims such as leaky pipes, broken windows or the like will not be covered, these types of damage typically only cost a couple hundred dollars to repair, which will be less than you save.
Be aware of what your home insurance actually covers. A regular home insurance policy doesn’t cover things such as flood damage. This type of insurance needs to be purchased separately through the Federal Emergency Management Agency. Another thing to consider is earthquake damage. If this is something that you may experience, you will have to buy specialized coverage from a private home insurance company. Luckily, both of these types of coverage are relatively inexpensive.
While you may live in an area not frequently flooded, weigh the cost of flood insurance against the possibility of flooding. Roughly 25% of federal disaster claims due to floods originate in areas not designated as flood risks. If you reside in an area that is not known for flooding, you may find this portion of your insurance cost is reduced.
Insurance Policy
Check the provisions for “due diligence” on your homeowner’s insurance policy. If you have neglected to keep up with regular home maintenance, your insurance policy may not cover the problems that result from that negligence. Check with your insurance agent about what types of documentation is required to prove you have been doing the maintenance.
Installing an alarm or security system is advisable if you are on the hunt for a new insurance policy. Doing this could reduce the annual premium you pay by more than 5 percent! Your home security system should tap into a local police station or other official center; this ensures that you will have sufficient documentation in the event of a burglary or break-in.
When considering insurance for your home, it may be beneficial to have an alarm system installed. Not only will this be beneficial for your own safety, but your insurance rates will reflect the added security as well. After providing proof that your system is monitored by an agency, you may qualify for up to 5% off your rates.
To save money on your homeowners insurance, you should pay off the mortgage as soon as possible. Most companies will consider you a smaller risk when there is no debt against a property and you will take better care of the property. Look into how much faster you can pay the loan off, by refinancing at 15 years instead of 30.
You want a policy with “guaranteed replacement value.” This covers the cost of a new home as opposed to the value of the old one which is gone.
Document all of your valuables including jewelry if you want to be covered for them. It takes some time and effort, but the only way your insurance company can get a good idea of what you have had damaged, lost or stolen is with a good photo record that will help to show what the accurate replacement value of your goods is.
If you own a very valuable object, you should consider getting insurance on it. Many insurance companies offer customized services and adapt to particular situations. You should get a professional to evaluate the value of your object; if your valuable possessions should be destroyed or damaged, the insurance would have to give you the equivalent of the estimated value.
If you are planning on remodeling or upgrading your home, remember that the project can potentially affect your premiums. Policies will increase depending on what kinds of products you use in your home extensions. Wood is more pricy than cement and steel in terms of being insured, because it can be damaged by weather or fire.
Putting an addition onto your home will increase your homeowner’s insurance rates because there’s now more home to insure. Minimize the increase by being smart with your building choices. If you can arrange for steel-framed construction, you may be able to pay less by choosing this less-flammable material. Consider the new roof’s fire rating as well.
Keep your homeowners insurance policy up to date. If it’s been a few years since you purchased your policy, you might be under insured. If you’ve made improvements to your home, your policy might not reflect the increased value. Building costs have gone up too, so review your policy yearly, and if needed, make changes to be adequately covered.
When putting on an addition, think about insurance costs during design. Using high-quality materials can reduce the increase in insurance your addition will bring. These materials are not going to be affected by natural disaster or time, which means you may not be charged as much.
No homeowner should forgo purchasing homeowner’s insurance. Once the deductible is met, homeowner’s insurance protects the policy holder from damage that the house may sustain from fire and other accidents, pays for loss from theft, and pays for medical treatment of any visitor who is injured on the property. This makes homeowner’s insurance invaluable to all homeowners.