Personal Insurance - Homeowners
Homeowners, Ask and Ye may Save
Homeowners Insurance, offering a package of Property and Liabiliy coverage, is a good bargain for the consumer. To pay properly for potential losses, however, care must be taken to meet the consumer's wants and budget.
A customer purchasing a Homeowners Policy should ask some standard questions, such as: What are the replacement cost provisions? How much liability will be provided? What is the choice of deductibles? Should jewelry, furs, special collections and other personal items be protected with coverage? What discounts are available for items such as smoke detectors? And these are not the only questions. Catastrophe such as Floods and Earthquakes are not covered by Homeowners Insurance, a separate policy must be purchased to gaurentee coverage.
A periodic Homeowners Polcy checkup is also a good idea, since circumstances and personal property may change. Home renovations or beginning home-based businesses warrant policy adjusting.
There are ways to reduce Homeowners' premiums without sacrificing much in the way of coverage. One way is to reassess the value of your possessions yearly, since an excess of coverage is a waste of money. Is the lip of that Ming vase now glued on? If so, it is not worth $25,000 anymore. Also, installing burglar alarms, smoke detectors and deadbolts may earn you discounts. Some insurers even offer discounts to non-smokers, since smoking indoors is a major cause of household fires.
The following is a list enumerated by Radio Shack in cooperation with the National Crime Prevention Council and the National Sheriffs Association outlining practices which can make a family safer. Following these may help lower your Homeowner's premium:
- Make sure that all doors to the outside are metal or solid (1 3/4 in. hardwood) and are equipped with a sturdy deadbolt lock (1 1/2 in.)
- Always lock your home when you go out, even if only for a few minutes.
- Secure sliding glass doors with commercially available bars or locks.
- Make sure your windows, especially at ground level, have good locks.
- Make sure all porches and other entrances are well lit.
- Trim any bushes or treee that hide doors or windows, and keep ladders, tools, toys and recreational equipment inside when not in use.
- Never hide your house keys on the premesis; give them to a trusted neighbor instead.
- Keep written records of all furniture, jewelry and electronic products. If possible, keep these records in a safe depsoit box, fireproof safe or other secure place. Take pictures or a video, and keep purchase information and serial numbers available. These precautions will help law enforement agents track and recover items.
An Umbrella Policy will increase Homeowners Liability and Personal Auto limits by $1 million or more. It provides liability Coverage for other potential family risks as well. The exact protection varies from carrier to carrier. Because the majority of liability claims results in payments to injured parties below the limits of the typical Homeowners or Auto Policy, the cost of an Umbrella Policy is extremely reasonable. The beauty of an Umbrella Policy is that is greatly lessnes your worry over those large injury awards you see in the news by reducing the chances of your assets being taken away from you.
Examine Your Homeowners Policy
Generally, Homeowners Policies cover contents for 50% of the value of the home's replacement value. Think about the contents of your home; should we raise that limit?
All Homeowners Policies have internal limits on money, silverware and certain other property, including business property. The coverage for jewelry is so limited that we recommend you schedule (list) your jewelry. Look up these special limits in the liability or property section of your policy. Maybe we should insure some of your property under and inexpensive Personal Articles floater.
Generally, Homeowners policies require the home to be insured to 80% of the cost of rebuilding if you are to receive full replacement cost in the event of a loss. However, most carriers will require 100% of the value when writing the policy to ensure the guaranteed replacement. Think about whether we should raise the insured value of your home; It would not cost a great deal.
What does my Homeowners Policy do?
- Generally limits contents coverage to 50% of the structure's limit (is this enough?).
- Covers personal property on the basis of either actual cash value (what you could sell the old couch for) or replacement cost (enough to buy a brand new couch).
- Contains special liability limits on personal property (Check your policy to see if its provisions are adequate for personal property such as jewelry, furs, silverware and other items).
- Commonly limits coverage on cash, coins, precious metals, tickets, stamp collections, manuscripts, deeds, financial documents, art and firearms (Business property in the home is limited, too).
After the Disaster
It seems that there should be a disaster-free location somewhere, but news of floods, earthquates, hurricanes, tornadoes and fires give cause for doubt. As the shock of disaster wears off, victim's thoughts will turn to collecting on the insurance wisely purchased years ago. First and foremost, notify us of the loss so we can get the insurance ball rolling. If temporary repairs must be made, save the receipts, since insurance may help with the cost. Then begin a list of damaged items; this will be easier if you've already prepared an inventory of personal property before the loss (and secured it at another location of course!). Don't throw out damaged items that are expensive (i.e. T'Vs, furniture, etc). If the adjuster can see them, the adjustment will move along more swiftly.
Attempt to identify structural damage and obtain written bids from reliable sources. Watch out for fly-by-night contractors who move into a disaster area to prey upon victims.
