Independent Homeowners Insurance Agents
“Far too many people feel that homeowner’s insurance covers their property…come what may. Unfortunately, it does not,” Ralph Nader who co-authored Winning the Insurance Game, states. “Knowing what is not covered under the basic policy is vital, if you are going to reach a complete understanding of your policy.”
The Components of Home Insurance
According to Wikipedia, home insurance or homeowner’s insurance is property insurance that covers homes. Your insurance policy includes personal property insurance protections as well as liability insurance for what may happen in the home.
Losses covered can include:
- The home
- Its contents
- Loss of use (additional living expenses)
- Loss of other possessions of the homeowner
- Loss of other structures, such as a detached garage
- Liability, should the homeowner be found negligent for personal activities
If you have a mortgage on your house, your mortgage lender will require you to purchase home insurance as a condition of the loan to protect the bank if the home were to be destroyed.
How is the Cost of Home Insurance Determined?
The cost of home insurance often depends on what it would cost to replace the house and which additional riders – additional items to be insured – are attached to the policy. The cost will also depend on the limit of liability you choose.
Kimberly Lankford, author of The Insurance Maze says, “Home insurance discounts vary from company to company, but ask your home insurance independent agent if any of the following can help lower your price:
- Several years without filing a claim
- Homeowners and auto insurance with the same company
- Being a non-smoker
- Home-security systems and deadbolt locks
- Certain roofing materials• Smoke detectors and fire alarms
- A home that is less than ten years old
- Jewelry kept in a vault.”
Types of Home Insurance Policies
There are seven standardized home insurance forms:
- H01 – Basic Form Homeowner Policy
- H02 – Broad Form Homeowner Policy
- H03 – Special Form Homeowner Policy
- H04 – Renter’s Insurance
- H05 – Premium Homeowner Policy
- H06 – Condominium Policy
- H08 – Older Houses
Classes of Home Insurance Coverage
In addition, for each policy, there are typically six classifications of coverage
- Coverage A – Dwelling
- Coverage B – Other Structures
- Coverage C – Personal Property
- Coverage D – Loss of Use / Additional Living Expenses
- Coverage E – Insuring Your Personal Liability
- Coverage F – Medical Payments
Many companies have their own specific home insurance forms which vary from the above classes and form options. Your agent can help you select the type of home insurance policy and classes of coverage that are right for you.
Saving Money on Homeowner's Insurance
Your agent can help you save money, both in up-front premium costs and in the long run, should you ever need to use your home insurance coverage. Be sure to remember these tips:
- “A large part of what you pay in premiums is determined by the amount of coverage you select. You want to be insured for an amount sufficient to rebuild your dwelling should it be destroyed. However, many people make the mistake of insuring an amount equal to the entire value of the property, including the land. Thus they are paying more than they have to for protection,” Ralph Nader says.
- “Everyone should raise their deductible to at least $1,000. You’ll save money in premiums,” Kimberly Lankford suggests.
- “Be sure to purchase a guaranteed-replacement-cost policy. Under this type of policy, the company guarantees to pay whatever it takes to fully replace your home,” Ralph Nader advises.
Insurance needs and laws are complex. Coverage varies wildly from company to company. Laws are vastly different from state to state. Your independent agent knows the laws and companies that provide coverage options. They can help you match what you can afford to pay with a prudent insurance plan.
Don't try to handle your insurance needs without a home insurance independent agent you trust.