Archive for July, 2010
Home Insurance Rate – What To Look For When Shopping
Homeowner insurance premiums are on the rise. There was a time when the home policy was the best and least expensive of all the property and casualty insurances. The homeowner policy is under attack. There are many more exposures than ever before. Toxic mold has caused some real problems in some areas of the country and caused the premiums to rise dramatically. Some states exclude coverage for toxic mold entirely. Natural disasters have had an affect on rates. The recent barrage of hurricanes has caused supply shortages and these shortages increase the demand and the price for repairs. These expenses are passed on to the policyholders eventually.
The rates are calculated by insurance company fiduciaries. They look at the cost of claims and the cost of doing business and compare it to the company revenue to come up with your rate. You have no control over how the companies derive their rates. They have to get approval from their state insurance departments before setting rates or increases. They cannot arbitrarily come up with a figure.
What Can You Do?
1.Understand Your Policy – Make sure that you know what kind of policy that you have right now. If you are making your first purchase then you need to research the kind of policy that you want. Replacement cost or Actual Cash value are your two major choices. Replacement Cost policies replace your structure or contents with material of like kind or quality with no depreciation. The actual cash value policy settles your loss by taking the replacement cost and subtracting depreciation because of age or use.
2.Self Insure – The best way to purchase insurance is to self-insure by using the highest deductible that you can afford. Homeowner policies have a much lower frequency of claims as compared to auto insurance. Low deductibles no longer justify the higher premium.
Use your declarations page when you comparison shop and make sure that you receive all the discounts. Multi-policy, protective device discounts, and retirement discounts are available on almost all homeowner policies. Check our recommended insurers for rates.
Tags: Auto Insurance, Barrage, Declarations Page, Deductibles, Depreciation, Doing Business, Exposures, Home Insurance Rate, Homeowner Insurance, Homeowner Policies, Homeowner Policy, Hurricanes, Insurance Company, Insurance Premiums, Natural Disasters, Policyholders, Property And Casualty, State Insurance Departments, Supply Shortages, Toxic MoldRelated posts
Home Insurance Quotes
With all the rising costs in the world consumers are looking for ways to cut costs and save money. Americans spend billions of pounds every year on their home insurance policies. It does not take a genius to figure out that every homeowner needs insurance, most people consider their home to be their greatest asset.
Thousands of homeowners are reaping the rewards that comes from filling out a FREE home insurance quote. Many are receiving 25-30% discounts on their policies while becoming more educated about the home insurance that is right for them. Here are a few tips that might help you when you are shopping for that “Perfect” insurance policy.
Increase Your Deductible
Just like auto insurance, policies have deductibles, and the same rule of thumb applies–carry the highest deductible you can afford. The higher your deductible, the more premium credit you can expect to receive from your insurance company. Your savings could reach 25% by increasing the deductible from £100 to £1000.
Improve Your Home Security
Most insurance companies offer discounts for smoke detectors, burglar alarms, dead bolts, fire extinguishers, and Neighborhood Watch Areas. Homes with a fire and burglar alarm system hooked up to a third-party monitoring company receive higher discounts than homes with local bell alarms.
Consolidate Policies
Insuring two or more vehicles with the same insurance company can save you 10 - 15% on your premiums. If you cover your homeowners insurance and auto insurance together, you can reduce your premiums by another 10 - 15%.
Construction Type
Before buying a home, consider its construction type, such as frame or concrete block and steel (CBS). A wood frame house typically costs more to insure than one built mostly of concrete.
Verify Distance To Fire Stations And Windstorm Areas
If you live in the country, you’ll probably pay higher rates for your insurance than if you lived in town. Why? It’s because of the longer distance to your local fire station. If you live more than 5 miles from the nearest fire station, and more than 1,000 feet from a fire hydrant, you will most likely pay a higher premium.
Before purchasing your home, you may want to get a quote for both and flood insurance. Insurance companies may not offer you windstorm or flood coverage, depending upon the area in which you live. If your home is in a hurricane prone area and your insurance company offers windstorm coverage, then installing approved hurricane shutters should result in a premium discount.
Claims Free Record And Renewal Discounts
If you have not had a claim under your policy during the past 3 - 5 consecutive years, you could receive up to a 15% discount, depending on the insurance company. Plus, most companies will discount your premium if your policy has been in force for 3 straight years.
Mortgage Free Discounts
Some insurance companies target who have paid off their mortgage and offer them premium discounts of up to 5%.
New And Renovated Home Discounts
A majority of insurance companies offer a discount for new homes, and you may qualify if your home was built in the last 10 - 15 years. Also, a recently renovated home costs less to insure, so find out when the last major electrical, heating and plumbing update was completed on the home.
Live-In House Keeper
Some insurers offer up to a 2% premium credit if you have a live-in employee as they feel it could reduce the likelihood of burglary.
Conclusion
After reviewing the foregoing savings tips, you may think that if you added up all your credits you could receive a 70 – 90% reduction in your premiums. Unfortunately, it doesn’t work that way. Certain safety or other measures you take may qualify you for being placed with the “preferred” company of a particular insurance group. This “preferred” company will be able to give you more premium credits than a standard company is able to.
Tags: Americans Spend Billions, Auto Insurance Policies, Burglar Alarm System, Burglar Alarms, Concrete Block, Construction Type, Dead Bolts, Fire Extinguishers, Frame House, Home Insurance Policies, Homeowners Insurance, Insurance Company, Insurance Policy, Neighborhood Watch, Premium Credit, Rule Of Thumb, Smoke Detectors, Windstorm, Wood Frame, World ConsumersRelated posts
Home Insurance Coverage - How To Get Affordable Home Owner Insurance
When you first buy a home, you may become overwhelmed by all of the extra costs you never thought about having. One of those costs may be home insurance coverage. Young homebuyers may not see the need for such costly insurance, but anyone who has used their home insurance knows exactly how important it is. Many mortgage companies require specific coverage plans. Even if you choose to buy your home, without financing it, you will need home insurance coverage. Take a look at this information to learn more about home insurance plans.
When You Need It
You may think home insurance is only good in natural disasters. When a tornado, hurricane, or earthquake damages your home, your plan should cover the damage. However, there are many times you can use your home insurance coverage regardless if there is a natural disaster or not. Consider this scenario: Your hot water heater bursts and no one is home. There is so much water on your floor that your expensive hard wood flooring is completely ruined.
With home owner insurance, you would simply be responsible for your deductible. The coverage would pay for the flooring to be replaced and often will even pay for a new hot water heater. Of course, these terms all depend on the type of plan you have, but for the most part, home insurance is beneficially for large as well as small disasters.
How To Pay For It
Choosing how you pay for your home insurance coverage can be important. Some owners would rather add their insurance right into their mortgage payment. Many banks prefer you to do it this way and are happy to accommodate. Other insurance companies will allow you to pay the premium monthly, every six months, or yearly. Select companies will even offer additional discounts for those who make one yearly payment. Consider these things when setting up your home insurance. You may get a great deal when you choose the right payment arrangement.
Tags: Affordable Insurance, Banks, Costly Insurance, Earthquake Damages, Hard Wood Flooring, Home Insurance Coverage, Home Owner Insurance, Homebuyers, Hot Water Heater, Hurricane, Insurance Companies, Insurance Plans, Mortgage Companies, Mortgage Payment, Natural Disaster, Natural Disasters, Payment Arrangement, Select Companies, Six Months, TornadoRelated posts
Home Insurance. Flood Alert
The Royal Institution of Chartered Surveyors warns that if you can’t get insurance for your house, you’re in big trouble. Mortgage lenders won’t lend on houses that are uninsurable and as a result its value could fall by up to 80%.
It’s a high flood risk that’s most likely to make your house uninsurable. According to a recent survey, 6.5 million homes are already at risk from flooding of which 1.5 million are in high risk areas. The government has completed flood defences in many such areas and protection for a further 80,000 homes is due this year. But concerns have also been expressed about a further 120,000 new homes planned for the Thames Gateway which are potentially in a high “at risk” zone. Yet many areas remain vulnerable. And if global warming continues, by 2030, the 1.5 million at risk could mushroom 3.5 million. Back in 2003 the Association of British Insurers (ABI) agreed the principles which committed UK insurers to offering home and contents insurance for properties in areas which are assessed to be at a flooding risk once in seventy five years or more. The rider was that the flood defences had to be already in place or would be completed by the end of 2007.
The Department for Environment, Food and Rural Affairs (DEFRA) has the responsibility of developing and maintaining these flood defences but within the insurance industry there’s widespread concern that insufficient progress is being made. As a result the insurers have has warned the government that there could be widespread withdrawal of insurance cover if progress is stepped up.
In the mean time, those in areas threatened by flood water could find their insurance premiums soaring. Whilst the insurance industry agreed to provide insurance cover, their commitment was simply to maintain premiums at “reasonable” levels. But there was no definition of what “reasonable” means. As a result premium increases of 60% have been common with up 400% increases in bad areas. In a tiny number of cases, cover has been withdrawn altogether, mostly in country areas where DEFRA considers the cost of defending a cluster of a few homes to be uneconomic.
Environmentalists warn that unless DEFRA gets it’s skates on, the UK ’s current bill for flood damage could rise from £950 million a year, to £3.2 billion. After all, the average insurance claim for household flood damage is £30,000 – that’s even higher than fire damage. And localised events like the 2004 flood at Boscastle, Cornwall , can cost the insurers over £15 million.
If you are in any doubt whether your home or proposed home, is in a flood risk area, you should visit www.environment-agency.gov.uk. This is DEFRA’s web site where you can check whether they think your home is at risk of flooding. Their maps were originally designed for planning purposes and provide information on a post-code basis.
Whilst many insurers use the DEFRA information, others like More Than, have their own flood maps. These assess homes individually rather than post code areas. This means that if your existing insurer increases your premium for flood risk and uses the DEFRA information, you may still be able to get a cheaper rate from an insurer using it’s own flood data if its data identifies that your property is beyond the “at risk” zone.
The ABI has recently added to the pressure on DEFRA to accelerate the building and upgrading of flood defences. It has warned that unless the government increases its spending on flood defences, the insurance industry may not continue their commitment to the 2003 principles.
That would be bad news for many homeowners.
Tags: Association Of British Insurers, Environment Food, Flood Defences, Flood Risk, Flood Water, High Risk, Home And Contents, Home And Contents Insurance, Institution Of Chartered Surveyors, Insufficient Progress, Insurance Flood, Insurance Industry, Insurance Premiums, Mortgage Lenders, Risk Areas, Royal Institution Of Chartered Surveyors, Rural Affairs, Thames Gateway, Tiny Number, Uk Insurers