A typical American house insurance policy covers the reconstruction of a home if it gets damaged by fire. Standard insurance covers medical expenses if people in your family get injured on your property.
But in some policies – jewelry or damage caused by an earthquake , flood are not covered. These coverage are generally optional.
To determine whether you need additional house insurance beyond what’s included in a standard policy, start with the most obvious factors. If you live in an area prone to earthquakes, look for policies that cover these events.
Next, think what it would cost to replace major items like furnace, water heater, roof. Independent insurance agents, call insurance companies directly, can help or check company websites for guidelines. Inventory your possessions, like all your vehicles, artwork and other valuables.
Rule of thumb make sure you buy enough coverage to replace your home , its valuables. Being honest in your assessments makes understanding your policies better and if it is sufficient.
Cost of House Insurance?
Cost of house insurance varies greatly depending on the age, size, location of your home.
Not all home insurance policies include standard replacement cost coverage, so choose one that does.
The factors that can affect home insurance premiums are – age and condition of the roof. Furnace, whether you have a fire alarm; and the value of your possessions are other factors. Fire alarms lower your rates while living in areas prone to floods make insurance expensive. Valuables such as memorable art or jewelry add to the cost or require additional coverage.
Other Factors
There are several other factors to consider when shopping for house insurance. Firstly, very important to understand the difference between cash-value policy and replacement-cost policy. Secondly, Cash value policy pays the depreciated cost, so you get less at claim time. But with the latter, you pay more for coverage and get much more when you file any claim.
It is better to compare rates from different insurance companies every year. This has been said by Robert Hunter, director of insurance at Consumer Federation of America.
Also US consumers do not shop, after staying with the same insurance company for 5 years. The reason for this is companies at times raise rates for longtime customers. Which means customers get a 7 to 9% loyalty rate after 10 years.
After analyzing the 10 home insurance companies a wider range of basic rates were found. The rates get calculated based on a family of four living in Illinois, priced $250,000.
So, it is very very important for the American customers to read their policy carefully. After reading minutely only, they can understand exactly what is covered and what’s not covered. When concerned about something not mentioned in coverage, then ask for a written statement stating the issue. These can be anything- damage from felling of trees or breaking of a car portion. If the Company wants to sell this customer a policy, they will put in writing. This has been mentioned by an expert.
Therefore, getting home insurance in America has never been so easy. Fierce competition prevails among these insurance companies.
