Saturday, October 4, 2008

Homeowners Insurance FAQs

Frequently Asked Questions - Homeowners Insurance

Question: Why do rates differ so much from company to company?

Answer: Insurance companies spend millions of dollars to research their clients, each geographic area, vehicle safety ratings and homeowner claim statistics are among many factors in order to determine their prices and target market. Some companies feel that they want grow specific areas of their books such as zip codes with lower claims statistics. Others may focus more on the investment non-owner occupied properties. Companies change discounts and rates based on what they feel their company needs in order to grow in clients and in profits. This is why companies change rates and discounts so frequently.

Question: How can I lower my insurance premium?

Answer: In many cases by adding your home and auto insurance with the same company can account for large savings. There are many different ways to lower your insurance premium. I would recommend first setting an appointment with your agent to review your policy. This should be done at least once a year. In some cases, just by evaluating your policy with you agent you may find new discounts the company offers that they did not when you started your policy. Homeowners insurance is very competitive from company to company and discounts change frequently.

Question: How does "Loss of Use Coverage" on my homeowners insurance work?

Answer: Loss of Use coverage would provide your family with a comparable place to live should your home be declared uninhabitable due to a covered loss in your homeowners insurance policy. In most cases your policy would cover the initial items such food if you have to move to a new location because you apartment is no longer inhabitable to to a loss such as a fire. Most insurance companies are willing to help during the transfer process.

Question: What does a claims adjuster do?

Answer: A claims adjuster's primary role is to investigate your insurance claim and evaluate your insurance policy to determine if the insurance company is liable for payment. A good way to look at your claims adjuster is as your insurance agent for your claim. A claim adjuster understands every endorsement and exclusion within your insurance policy and is a great resource for questions regarding your claim. In most cases your agent cannot directly answer legal questions regarding your claim and will forward you to your claims adjuster for such answers.


Get a free homeowners insurance quote today.


Question: Does my homeowner policy cover floods?

Answer: No, In order for your home to be covered for a flood loss you will have to purchase a stand alone flood policy through the National Flood Insurance Program (NFIP).

According to the NFIP the average flood insurance policy is $500 per year.

Question: Will my homeowner policy pay for my air condition or other appliances?

Answer: In most the answer would be NO. The only way that your appliances would be covered in a loss is if the loss specified in your policy such as a fire.

If you appliances stop working due to normal breakdown or wear and tear, they would not be covered. In order to cover your appliances you would need to purchase a "home warranty Policy". Home warranty policies cover your appliances and other items should they break down within their policy stipulations.

Question: What happens if my home is vacant and is vandalized?

Answer:Your policy contains a co-insurance clause that details how your policy would pay should you have a loss and your home is deemed to be vacant at the time of loss. Each policy treats these instances differently and your claims adjuster would be a good point of reference for interpreting payout of your policy. Contacting your agent will give you an better understanding of this prior to a loss.

In most cases your policy will pay at a significantly lower coverage limit than stated on your policy. Some policies will pay at a percentage of what you policy limit states. Such as 80% of your policy limit where as if your property were occupied at the time of loss it would be 100%.

Question: Does my policy cover hail damage?

Answer:Yes, almost all homeowners insurance policies cover hail damage as a standard peril.

Question: Does my policy cover earthquake damage?

Answer:No, but you may be able to add it to most insurance policies. You may also purchase it as a stand alone policy in some states. In other states you may purchase a policy from the state in which you reside such as California.

Question: Does my policy cover mold?

Answer:Maybe, mold damage has been covered where it results from a covered peril, such as a broken pipe, a storm, or fire suppression efforts, but not where it occurs gradually over time due to wear and tear. We recommend consulting with your agent in order to have clear understanding on how your policy would cover mold damage as it may be different from policy to policy and state to state.

Question: How does my liability coverage work?

Answer: Liability coverage is a very important and complicated section of your insurance policy. In basic terms, it would cover you should you be found negligent in the harm of a person not living in your household or actions occured on your property and in some cases outside of your home's premises. It would provide assistance in a lawsuit arising from these and other liabilities initiated on your behalf. We recommend that you consult with your agent for in depth understanding of your liability coverage.

Question: What is the limit for cash, should I have a break-in and money is stolen?

Answer: Usually policies have a limit on cash losses. This is between $100-$500.

Question: How do I add coverage for specific high value items such as jewelry, collectibles, fine china, etc.?

Answer: You will usually have to start by having your item(s) appraised. This may be waived if your product is new or your appraisal is within 6 months old. Next, take pictures from many angles. Finally, take all of these items to your agent who will forward these items to his/her underwriting department for approval. Your items will not be covered until approved by the insurance company underwriter and payment for the additional coverage is remitted.


Get a free homeowners insurance quote today.



Posted By:

DISCLOSURE: All entries by QuoteFishing.com are for informational purposes only and it is always recommended that you consult with your local insurance agent as coverage, definitions and claims procedures may differ from state to state.

No comments: