Affordable Home Insurance - Loop Holes That Cost You Money
There are many ways through which insurance companies make money from unsuspecting customers.
These are traps that cost people a lot of money.
Knowing these loop holes and plugging them would ensure that you only pay what you have to pay to get an affordable home insurance coverage.
Find out some of these loop holes.
The first thing any homeowner should do is to be very familiar with their policy.
You need to understand what the policy says and the extent of coverage you are enjoying.
Knowing this is the only way you can be sure you are really as covered as you thought.
A good understanding of your policy also helps you know what to do when it is time to male claims.
Many people get a policy and do not bother to review it from time to time.
This is one very easy way to be either under or over covered.
You can be over covered if some of the property you had when you first took out the policy is no more with you either because you now have it or them in the bank or you gave them to your daughter on her wedding or any other reason.
If you have reviewed your policy since then, your rates would still be high since it still assumes that those valuables are still there.
On the other hand (and this is more common), people add more valuables over the years.
If your policy is not reviewed to take these into consideration, then you would be under covering yourself.
This would only become obvious to you when you make a claim only to see that many of those valuables were not covered.
Do a regular review of your policy to make sure you are correctly covered.
When some people get their policy, they just assume a lot of things.
In your home insurance policy, you have to know if what you would be paid when you make a claim is the Actual Cash Value or the Replacement Value.
Actual Cash Value.
This refers to the value of the insured item at the time of making the claim.
It calculates depreciation values.
What this means is that if your insured item cost you $1000 when you bought it but due to wear and tear and general devaluation, would probably have a second hand value of $300, this is what you would be paid when you make a claim.
Yes, a difference of $700.
This type of policy usually attracts a lower premium.
Replacement Value.
In this arrangement, you would be paid what it would cost to replace the insured item at current market value.
This means that if you bought the item for $1000 3 years ago but due to inflation it now costs $2000, you would upon making a claim be paid $2000 so you can replace the item.
You are paid what it would cost to replace the item at the current rate.
Looking at the two examples above, you would see that if a person has a policy that would settle claims based on Actual Cash value and thinks he/she would get Replacement Value, he/she would be in for a very rude shock.
Know the details of your policy.
This can not be over emphasized.
When you get your policy, be sure to find out from your insurer all the discounts you can qualify for.
You might actually discover that you have already qualified for some of them and even if you have not, you can work towards it so you can make nice savings.
Your savings can not be complete if you did not get free home insurance quotes for comparison.
Getting and comparing free home insurance quotes is a prerequisite for enjoying cheap home insurance coverage.
These are traps that cost people a lot of money.
Knowing these loop holes and plugging them would ensure that you only pay what you have to pay to get an affordable home insurance coverage.
Find out some of these loop holes.
The first thing any homeowner should do is to be very familiar with their policy.
You need to understand what the policy says and the extent of coverage you are enjoying.
Knowing this is the only way you can be sure you are really as covered as you thought.
A good understanding of your policy also helps you know what to do when it is time to male claims.
Many people get a policy and do not bother to review it from time to time.
This is one very easy way to be either under or over covered.
You can be over covered if some of the property you had when you first took out the policy is no more with you either because you now have it or them in the bank or you gave them to your daughter on her wedding or any other reason.
If you have reviewed your policy since then, your rates would still be high since it still assumes that those valuables are still there.
On the other hand (and this is more common), people add more valuables over the years.
If your policy is not reviewed to take these into consideration, then you would be under covering yourself.
This would only become obvious to you when you make a claim only to see that many of those valuables were not covered.
Do a regular review of your policy to make sure you are correctly covered.
When some people get their policy, they just assume a lot of things.
In your home insurance policy, you have to know if what you would be paid when you make a claim is the Actual Cash Value or the Replacement Value.
Actual Cash Value.
This refers to the value of the insured item at the time of making the claim.
It calculates depreciation values.
What this means is that if your insured item cost you $1000 when you bought it but due to wear and tear and general devaluation, would probably have a second hand value of $300, this is what you would be paid when you make a claim.
Yes, a difference of $700.
This type of policy usually attracts a lower premium.
Replacement Value.
In this arrangement, you would be paid what it would cost to replace the insured item at current market value.
This means that if you bought the item for $1000 3 years ago but due to inflation it now costs $2000, you would upon making a claim be paid $2000 so you can replace the item.
You are paid what it would cost to replace the item at the current rate.
Looking at the two examples above, you would see that if a person has a policy that would settle claims based on Actual Cash value and thinks he/she would get Replacement Value, he/she would be in for a very rude shock.
Know the details of your policy.
This can not be over emphasized.
When you get your policy, be sure to find out from your insurer all the discounts you can qualify for.
You might actually discover that you have already qualified for some of them and even if you have not, you can work towards it so you can make nice savings.
Your savings can not be complete if you did not get free home insurance quotes for comparison.
Getting and comparing free home insurance quotes is a prerequisite for enjoying cheap home insurance coverage.
Source...