Homeowner's insurance is a necessity.
Whether your house is paid for or not, no one can afford to be uncovered.
Basically there are 5 things you should know about homeowners insurance.
Premiums, deductibles, credit rating, loyalty and coverage are the 5 key areas to know about when purchasing home owners insurance.
Premiums This is the monthly payment.
Most often you make a series of 6 payments for 6 months of coverage.
The policy then renews every six months.
There is usually a charge for offering this service, be sure to find out exactly what this option is costing.
If it is not clear ask.
If you can pay a semi-annual or annual payment.
Doing this will result in a discount at most agencies.
If they do not offer a discount, ask for one.
Paying one yearly premium or two annual premiums saves the company time and money.
It also saves you time, effort and money.
Deductibles Going with higher deductibles results in lower payments.
Higher deductibles save the company money because it eliminates small claims.
It is essential that the insured homeowner has the funds to pay the deductible.
Having a $1000 deductible and no funds to support it can spell disaster quickly.
Lower deductibles offer excellent coverage but can be costly.
Each individual has to assess their situation to determine what is best.
Credit Rating Insurance premiums are in part based on the credit rating of the applicant.
Insurance companies equate a high-credit rating with reliability.
They feel the high rating is obtained by people who pay their bills on time and have few if any claims.
Of course, other factors will be called into account, but credit rating has a significant impact.
Make sure to tighten up the credit report prior to insurance shopping.
Other factors include any prior tickets or claims, number of years continuously insured and ratings from other insurance companies.
Loyalty Company loyalty used to get consumers a lot of benefits.
There are still loyalty options out there, but consumers have to ask and be insistent to get them.
Ask for a rate discount based on years of continuous service with the agent who services your policy.
If the agent cannot help, ask to speak to a supervisor.
Be insistent but polite.
For each person that turns you down, thank them and ask to speak to the next person up the line.
If no discount is forthcoming consider another company.
Coverage Choosing appropriate coverage is crucial.
There needs to be enough coverage to assure the house and contents will be replaced in the case of damage.
You have to document accurately and insure the house contents.
Expensive jewelry, furs and other luxury items may need special riders to cover them separately.
Ask about replacement value insurance.
This cost more but is well worth the money spent.
If anything happens to a covered item, it is replaced at the current market value.
There is no depreciation.
Th last thing is to be sure you are comparing like with like.
Get out policies so that you can do a side by side comparison assuring that deductibles and coverages are identical.
This is the only way to get an accurate comparison of the rates.
Homeowners insurance is extremely serious and deserves careful consideration.