Posted by Tom Carolan on Fri, Nov 13, 2009 @ 04:44 PM
Are you a resident of California? Texas? Mississippi? Louisiana? Florida? If you can answer yes to any of those then you're all too familiar with the difficulties people face obtaining homeowners insurance when they live in a high risk area. Insurance companies are often very reluctant to insure homes in an area that presents a high risk of actually having to file a claim, and as a result there are thousands of homeowners left homeless and heartbroken after a natural disaster strikes.
The government, after paying out billions of dollars in storm damages under federal disaster programs, has finally established a series of mandates intended to protect houses in high risk areas through the development of a "shared" market, a series of involuntary homeowners insurance plans and guidelines that ensure that everyone has the protection they need, regardless of where in the country they happen to live.
Voluntary Homeowners Insurance
If you've purchased a homeowners insurance policy through a company such as Allstate or State Farm you're already familiar with the concept of voluntary homeowners insurance. Voluntary homeowners insurance is a booming business in
the U.S., made even more so by the fact that most homeowners are required to have insurance if they are renting or have not yet paid off their mortgage.
Voluntary homeowners insurance is exactly what it sounds like-voluntary. Companies offer this type of coverage because they choose to, and because of this they have an almost limitless freedom to decide what they are and are not going to cover under their standard policies. Earthquake and flood coverage tend to fall into the "not" category, making it difficult for homeowners in high risk areas like oh, say, California or the Gulf of Mexico (earthquake and flood zones, for anyone who hasn't had the pleasure of watching their bookshelves dance at two in the morning or taking a swim down Main Street on a summer's afternoon) to find the coverage they need.
Involuntary Homeowners Insurance
Because most homeowners insurance providers don't want to find themselves saddled with a property they can almost guarantee is going to cost them money in the long run the government has stepped in and established the involuntary insurance market-i.e. guidelines stating that certain individuals in certain areas are required to be covered, at a reasonable cost, and certain insurers are required to provide that coverage. This can take the form of the FAIR plans or the Beach and Windstorm plans available in some areas, along with other state funded programs, or go through FEMA (as in the case of the National Flood Insurance Program).
There are many people who don't believe that the government has the right to force insurers to provide coverage, claiming that the costs don't justify the returns; however, without involuntary homeowners insurance programs there are thousands of individuals from coast to coast who would find themselves without a home or any hope for their financial future after taking care of the damages. Sometimes, it's a very good thing that big brother is watching.
Posted by Tom Carolan on Fri, Nov 13, 2009 @ 04:09 PM
Got homeowners insurance questions? Here are the top five homeowners insurance questions complete with answers.
- What does homeowners insurance cover?
Homeowners insurance protects your home and your personal possessions from damage due to fire, lightning, burglary, vandalism, and acts of nature. It also protects you against liability lawsuits if someone is hurt in your home and they sue you.
- How much insurance do I need?
You need enough homeowners insurance to cover the cost of rebuilding your
home if it's destroyed, to replace your personal possessions if they're damaged, and to protect you from liability lawsuits.
To assess how much home coverage you need, get the square-foot building costs in your area from a builder or a realtor, then multiply that figure by your home's square footage. For coverage for your personal possessions, take an inventory on everything you own and use the total value. And for liability insurance, figure enough coverage to protect your assets in the event you're sued.
- What about flood and earthquake insurance?
Most standard homeowners policies do not provide flood or earthquake coverage. If you live in a flood or earthquake zone you'll need to get additional insurance.
- Where can I get cheap homeowners insurance?
Insurance premiums can vary by hundreds, even thousands of dollars a year from one company to another, so the best way to get cheap homeowners insurance is to comparison shop. www.InsuranceBestPrices.com enables visitors to easily comparison shop the top insurers in the industry, helping them to secure the most coverage for the lowest cost.
- How do I find a good insurance company?
Most states maintain a department of insurance website that provides a host of consumer information, including claims that have been filed against insurance companies. Also visit the "Resources" page of InsuranceBestPrices.com for some great online tools to help you find the best insurance coverage for your home.
J.D. Power & Associates rates homeowners insurance companies based on input from customers who own insurance policies with those companies. These ratings give you a good idea of how an insurance company treats its customers and how it pays its claims.
Posted by Tom Carolan on Fri, Nov 13, 2009 @ 03:52 PM
If you plan to buy a home or condo, you must have Home owner insurance. Not only does it protect your home investment, it is also a requirement when you buy a house and lot through mortgage.
Home insurance is a protection given to your house in case it is damaged or needs repair.
One effective way in buying a condo insurance, another term for home insurance is to inquire first at your existing insurance company, whether it is life insurance or car insurance.
Some insurance companies have different types of insurance policies. Moreover, many insurance companies grant discounts if you buy several insurance policies with them.
There are many types of coverage to choose in buying home owner insurance. HO-1 is the basic type to protect your property from 11 threats which include fire, vandalism, lightning, theft, major breakage and overflow of water from plumbing. The HO-5 policy covers everything except flood, war and earthquakes.
If you need to insure your house from natural disasters, you need to buy a separate condo insurance. Another consideration before buying your home insurance policies is to make an estimate on how much it would cost for you to rebuild your house in case it is damaged or destroyed.
The insurance company has its own guidelines to estimate the replacement expenses together with the corresponding premiums. Of course, the higher the replacement expenses, the higher the premium.
The premiums for your home owner insurance also differ depending on where you live, the value of your house, your length of stay in your house, and the number of insurance claims in your neighborhood. So better to shop around and compare home insurance providers.
If you want to save on your condo insurance, look for ways that can help get lower premium. For example, you can install effective security system, fire protection system and maintaining a 100 feet around your home.
If your neighborhood is prone to flood, your basement and its furnishing are not covered unless you have a separate flood insurance. In other words, know your major risks and do something about it to make it disaster-resistant.
Depending on your insurance company, there are policies that cover the contents of your house. Know which items are part of the home owners insurance. These can be any valuable items such as jewelry, expensive equipment, computers, artworks and more.
There are also riders that you can add on to cover your living expenses when you have to stay somewhere while your house is on reconstruction. Another coverage that you should check is your liability in case a guest is injured by slipping off your stairs. There is a type of condo insurance that covers liability expenses while you are away.
Increase your deductible. It can save you up to 25% over a 5-year or 7-year period. When you pay the lower deductible on your home owner insurance, you are only wasting your money particularly when you have never filed a claim [because you never meet the deductible].
Finally, you have to maintain a good credit rating. When the insurance company knows that you have good credit standing [by paying your bills on time], you may get good premium rates for your home owner insurance.
Posted by Tom Carolan on Thu, Nov 12, 2009 @ 12:37 PM
As the weather cools and families spend more time indoors, the risk for home fires increases this time of year. Appropriately enough, October is Fire Safety Month according to the Home Safety Council. Here are some of the top recommended tips for preventing fires in the home this season:
Cooking is the most common cause of residential fires, according to the Center for Disease Control (CDC). Although it may not seem like a big deal to leave the room for a few minutes while cooking, it's never a good idea. It only takes a few seconds for a simmering dinner to turn into a charred kitchen. Make sure when cooking that flammable objects are kept far away from gas and electric stove tops including dish rags, paper towels, etc. Also, never leave children unattended in the kitchen while food is being prepared.
Someone is injured in a fire every 30 minutes in the United States. And every 158 minutes, a fire related death occurs.
-CDC- Fire Deaths and Injuries Fact Sheet
Smoking is the leading cause of fire related deaths. Of course your best bet is to quit. However, if you must smoke, do it carefully. Smoke outdoors and purchase fire-safe cigarettes if possible. Always use an ash tray to extinguish your cigarettes and make sure there are no warm embers in the ashtray before emptying in the trash.
Heating: If you have a furnace, it is recommended that you get it inspected by a professional at least once a year before the winter season. A heating and air professional will be able to tell you if you need your furnace cleaned or repaired. If you have a fireplace in your home, be sure to have your chimney cleaned once a year to avoid chimney fires. Also, make sure the area in your home in front of your fireplace is clear of furniture, drapery or any other flammable objects. If you use space heaters in your home, be sure they have been safety inspected and never leave them on when you are not in the room. Again, keep them away from flammable objects.
Candles are popular around the holiday season but extra precaution should be taken whenever you have candles in your home. First of all, electric candles are much safer and should be used whenever possible. However, if you must opt for the real thing make sure you keep the candles in a safe place where they cannot ignite other objects. Also, make sure to blow out candles before leaving the home or going to bed for the night.
Other Tips:
- Test your smoke and fire alarms to ensure they are functioning correctly
- Plan a fire evacuation plan with your family