Homeowners Insurance – Everything You Need To Know
Are you thinking about applying for homeowners insurance? Are you wondering how to value your property or how your premiums will be determined? Here is everything you need to know about homeowners insurance before applying.
Factors That Determine Your Premiums
1. Characteristics And Features Of Your Home
Your premium amount should be determined by the age of your home, the type of structure, the roof, the garage, the electrical wiring and much more. If you have an older home, you should expect to pay more premiums. Also, the amount of premiums paid can differ depending on the type of material used to construct your home such as brick, stone, synthetic siding and much more.
2. The Location Of Your Home
Your home insurance premiums can be affected by your home’s location. For instance, if it is close to a fire, locations with exposure to extreme weather conditions such as earthquakes, tornadoes, hurricanes and much more. The premiums are bound to increase if your home is located in an area with too many security issues.
3. Safety Devices
Have you installed burglar alarms, fire extinguishers, sprinkler systems or smoke detectors in your home? By enhancing the safety of your home, you can always count on lower home insurance premiums. Therefore, regardless of where you’re staying, you need to install these features to get a lower rate on your homeowners’ insurance policy.
4. Personal Conditions
Your own personal situation can affect your home insurance policy considerably. For instance, if you’re a smoker, you should expect to pay more for your policy than a non-smoker. If you have a good credit rating, you should also pay lower home insurance premiums because you’re financially stable.
5. Home Insurance Claims History
Have you ever claimed anything on your home insurance? The more you claim, the higher your home insurance premiums. Therefore, the longer you take without claiming anything on your home insurance, the lower your home premiums should go.
Do All Homeowners Need Home Insurance?
If you own a car, you need to purchase auto insurance. However, that’s not the case with home insurance. It’s not mandatory for all homeowners to get insurance for their homes. However, that’s only applicable for those who have purchased their homes with cash. Note that, if you financed your home purchase with a mortgage, your lender will encourage you to apply for an insurance cover.
That way, your home is protected in the event of any damage from unforeseen circumstances such as disasters or fires. If you live in a location prone to earthquakes and flooding, your mortgage lender should advise you to apply for flood or earthquake insurance depending on the circumstances in question. Once your mortgage is completely paid off, there is no need to purchase home insurance.
However, it’s prudent to keep the insurance plan active, to make sure your home is protected in the event of anything. If you own a condo or co-op, you might be required to purchase home insurance or condo insurance. You can check with your co-op board to find out the type of insurance required in this case.
If you’re thinking about insuring your townhouse, you should find out from the association the master policy in place. Most of these master policies cover the entire structure and the common areas of your home but you need renter’s insurance. However, if there is no master policy in place, you will need to apply for homeowner’s insurance on your own.
The Home Inventory
Once you have purchased a home insurance policy, you need to create an updated policy that allows you to expedite a claim if one is necessary. A home inventory makes it easier for the insurance company to settle your claim, whenever you need one. Also, you can verify your losses when filing your income tax return with a clearly written inventory.
Your home inventory should contain your list of possessions with a complete description of each item. That includes the make and model as well as where each item was purchased. Don’t forget to include sales receipts, appraisals or purchase contracts if you have them.
Homeowners insurance is crucial since you will never know when your home is damaged. Use this information to determine whether home insurance is the right thing to do.
Tips When Choosing Car Insurance
Choosing the right car insurance can sometimes be an overwhelming process, especially if you don’t know what to look for. One mistake many people make is going with the first option they come across because they want to avoid spending time in the process. Investing some time and effort is important because you will be able to find the right car insurance that meets your needs, and even pay lower premiums. Different companies offer different types of coverages and pricing, and you may end up with the wrong option if you are not careful.
Below are some great tips that will go a long way in helping you choose the right car insurance policy.
Decide on the kind of insurance you need
A comprehensive car insurance is a great choice for customers with a new or valuable car or a car loan where the vehicle is the security of the loan. This is also a good option if you are looking for top level cover. A third party property policy is a good choice for people with cheap cars and wants to protect against major liabilities like being at fault and causing property damage to someone else’s property. Fire and theft coverage is another alternative, but it doesn’t cover the crash damage.
An insurer who provides good customer service is more likely to provide you with great insurance products. You want to go with an insurer who will be able to handle any issues quickly and efficiently. One way you can determine whether they provide good customer service is getting on the phone and calling the claims department. See the time it takes to get through and if the help offered is friendly and capable.
Do an annual rate check
Check rates from other companies to make sure you are getting the best deal. There are many online comparison tools you can use, helping you find the best possible deal for you. There will be many other factors to consider apart from pricing, but you want to get the cover you need at the lowest price. A personalized quote is no immediate and you will have to wait for a call back from the insurance agent, but going online is more time efficient.
Set the right deductible
A higher deductible will lower your premiums, but that means paying more out of your pocket when you are involved in an accident. If you have a good driving record and you have not had any accident that was your fault, then you can gamble and choose a higher deductible. You can expect to make savings of up to 40 percent.
Take advantage of discounts
Insurers will provide discounted rates to drivers considered to be a lower risk or those who have taken a driver-training course. Having auto theft and other safety equipment installed can lower your costs. Another option is bundling your car and home insurance, but it is important to combine the policies and see which of the option is cheaper.
Beware of Scams
There are crooked drivers who stage accidents that result in insurance claims against you. If you want to avoid this, then you should practice good driving practices. If you happen to be involved in a crash, the first thing to do is photographing the crash scene and call the police to report the incident. Insurance claims against you can increase the premiums you will be paying.
Watch out for minimum coverage
The state legal minimums for insurance coverage should be considered as just minimums. It is recommended to go for policies that have higher limits. If you are involved in a crash and held liable and you only have the state minimum required coverage, you may end up paying for the other person’s damage. If you don’t have a liability coverage, you will be responsible for paying for the pain, suffering, and other damages as a result of the crash. The insurer will not provide you with a lawyer or pay for one if you are sued.
Choosing the right car insurance is important because you need to have the right insurance cover for your vehicle. You will also have a chance to find a cover with lower premiums.
Why Auto Insurance Companies Prioritize Grades And Other Strange Things
When talking about auto insurance, most people wonder why certain cars are cheaper to insure, why insurance companies want you to get good grades, and why accidents that aren’t your fault can actually make it harder for you to get coverage. However, the answer isn’t that strange, and it all comes down to personal habits and responsibility. Insurance companies want to reward people who make good choices, who are going to be careful, and who are not likely to need too much help.
However, many companies do offer accident forgiveness, and are more than willing to work with people through small repairs. In fact, getting these repairs put in to the company, instead of keeping them a secret, can also help bring down the amount of money that an insurance policy costs. This again comes down to personal responsibility, but also to honesty, something that makes the job of claims agents much easier.
Getting good grades sends a signal to the insurance company that the person driving is able to follow rules, generally be on time, and to keep track of their own affairs. This translates over to driving safely, not speeding, and keeping up to date with all of the necessary maintenance that keeps a car in good condition. People who do this, are then offered a lower rate on their insurance, as they are less likely to cause problems.
People who get faster cars, with certain paint colors, and certain modifications, are more likely to speed, to try and show off for their friends, or to disregard the rules. Even if it just one time to test how fast the car can go, this can end in a fatal accident that harms the driver, those around them, and costs a large amount to repair. This is why cars that are seen as boring, are giving a greater discount, as they don’t tend to encourage these behaviors.
Getting into an accident, even if it isn’t your fault, is one of the ways that insurance companies can gauge if you are paying attention. Someone who is truly paying attention, can generally avoid the bad actions of others. While it is easy to focus only on the road, it is important to focus on the cars all around you as well, and insurance companies want to make sure that they reward you for doing so.
Finally, older cars are likely to need more work, so they are more likely to stall out and cause an accident, or to have a major problem. This means that insuring them is more expensive, covering the cost for their eventual break-down. The way insurance companies see this, and the way you should as well, is as a means of protecting the value of your car, ensuring you actually get paid out for the full value when it does break-down, instead of a partial value that will leave you without a car.
While these behaviors are easy to track from afar, there are a number of companies who have begun offering dash cams and other tracking software to their clients as well. These track things like speeding, running red lights, the amount of time spent driving, and so much more. These too operate on the premise of discovering who is responsible and rewarding them for that behavior. Many people who have older cars, have chosen a fancier model, have an accident that wasn’t their fault, or who have gotten bad grades find that these help them reduce their monthly payments.
Overall, good drivers are going to get a reduction in the amount of money that they need to pay for auto insurance, people who aren’t good drivers or who are at risk of being bad drivers, will not get rewarded, but do have steps they can take to reduce the amount that they pay.
Hopefully understanding all of the factors that go into making decisions about how much it costs to offer auto insurance to a person will help you be a safer driver, but will also help you save money over the next few years. You might be surprised how much you can save, with just these little changes.