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?
Not, 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.