Characteristics of a Good Home Insurance Services
Having an insured home is not a luxury, it is a necessity. It protects your home and belongings against damage and theft. Mortgage companies also require the borrowers to have an insurance for the property. And refuse to make a loan or finance a residential estate transaction without it. Owning a property is not a requirement for buying an insurance. As many landlords require their tenants to have a renter’s insurance. While unlike health insurance and auto insurance. It is not a strict legal requirement to have a home insurance services it is still wise to possess one.
Homeowner’s Policy Provides Coverage
A standard homeowner’s insurance policy provides coverage to the insurer in the following circumstances;
The Extent of Coverage under Home Insurance
If your home is damaged in a fire, hurricane, vandalism etc. it will be covered by your home insurance company. However, the damage from floods, earthquakes and poor residential maintenance is not covered under the general policies. Other structures on your property, like a garage or a shed, need to be covered under separate policies. Your belongings in a house, such as clothing, furniture, electric appliances are also covered under the policy. You can also get an ‘off-premises’ clause for the belongings lost off the property, such as jewelry. You must keep in mind that the coverage for belongings on the property can only be provided at the value of 50- 70% of the total amount of insurance you have on the property on average.
Personal Liability Characteristics
Liability clause in a home insurance policy provides coverage from lawsuits filed by others. This clause also includes pets, so if your dog bites a neighbor, the damages can be covered under it. Or if a guest slips on your stairs and successfully sues you for pain and suffering, it will also be
covered in this clause.
Additional Living Expense
If you find yourself in a situation where you have to live in rental property or a hotel. While your house is being built, those expenses will be covered under this clause. It would provide you reimbursement for rent, restaurant meals and other incidental costs.
Different Types of Coverage’s
All policies are different in what extent they provide coverage for. The more costly they are, the greater their extent of coverage.
There are essentially three levels of coverage:
Actual Cash Value
This policy covers the house along with the value of your belongings after deducting depreciation.
Extended Replacement Value
This is an inflation buffer policy. It is also the most comprehensive. As it pays for whatever costs for rebuilding even if it exceeds your policy limits. However, the typical ceiling for this coverage is 20-25% higher than original value. When inflation is taken into account, most analysts insist on buying this clause for your home insurance policy. As it renders the rising costs for rebuilding or repairing your home and your possessions relatively meaningless.
This clause deals with the original value of the house or property. And provides the actual cash value without any deductions for depreciation.
Exclusions in a Home Insurance Policy
A homeowner’s policy provides coverage for the most scenarios where a loss could have occurred on your property. There are still some events which are excluded from it. These events include acts of war. Such as your home getting destroyed in a grenade or missile attack during some skirmish in a war. It also excludes your property getting destroyed by an ‘Act of God’, for example a flood, or an earthquake.
If you live an area which is in frequent threat from floods or hurricanes. And If you want coverage against such incidences, you would want additional clauses for them which will cost more.
The Rates for a Home Insurance Policy
The claim frequency and severity play a considerable role in determining rates. For example if there are more than one claims relating to the same issue, like water damage, wind storms etc.
You must understand that while insurers must pay the claims, they are also in this business to make money. Insuring a home for which multiple claims have been made in the past three to seven years. It can bump your home insurance premium into higher pricing. Even if the responsible party was a previous owner. You may even find yourself completely ineligible. Based on the number of recent past claims filed for a home insurance policy.
The neighborhood, crime rate, and building material availability also play a part in determining premium rates. Coverage options like deductibles or added riders for art, wine, jewelry, etc. can also significantly increase your premiums.
Pricing and eligibility for home insurance also varies. Depending on an insurer’s preference for:
- Certain building construction materials
- Roof types
- Condition or age of the home
- Internal heating or cooling systems type
- The proximity to the beach
- Existence of a swimming pool
- Security systems and more.
An ill-maintained home decreases the odds an insurer will pay a claim for damages. You must also strive to choose a home insurance services near me so you can easily maintain contact for damages.