things to
consider when buying home insurance
There are a number of factors you should
consider when purchasing any product or service, and insurance is no
different. Here is a checklist of things you should consider when you
purchase home owners insurance.
The first thing is to purchase the amount and type of insurance that you
need. Remember that if your policy limit is less than 80% of the replacement
cost of your home, any loss payment from your insurance company will be
subject to a coinsurance penalty. Also, determine the amount of personal
property insurance and personal liability coverage that you need.
The second thing is to determine which, if any, additional endorsements
you want to add to your policy. For example, do you want the personal
property replacement cost endorsement or the earthquake endorsement?
The last thing is once you have decided on the coverage you want in your
homeowners insurance policy, you can now decide which insurer you would like
to purchase the insurance from. Some people like the idea of purchasing
insurance from a mutual company rather than a stock company. Also
decide whether you would like an insurance agent to assist you in your
purchasing decision or if you would like to buy the product directly from an
insurer without the assistance of an agent.
Is all home
insurance the same?
No, all Insurance policies are not the same.
The areas and level of protection offered to your home will vary from policy
to policy. As a result the home insurance policies will also vary in price.
It's best to disuse with your insurance agent which home insurance policy
fits you best.
what is an
umbrella policy?
Umbrella policies supplement the liability coverage you already have
through your home and auto insurance and provide an extra layer of
protection. Umbrella policies aren't just for the wealthy — they're for
anyone who has assets that might be at risk if they are responsible for a
serious accident.
If you don't have enough liability coverage to resolve a claim or a
lawsuit, the person bringing the action might go after your home or your
other assets to pay for damage. Umbrella policies cover damage claims that
you, your dependents, or even your pets may cause.
Umbrella policies kick in after the liability insurance in your
homeowners and auto policy runs out. For example, if you have a home
insurance policy with liability coverage of $300,000, the umbrella policy
will pay claims above that amount up to the limit selected.
Most of the risk is assumed under the primary auto or home policy, which
is why personal liability umbrella is so inexpensive. You can buy a $1
million or larger umbrella policy for less than $200 a year.
