Ten Steps to Choosing

All homeowners are concerned about protecting their houses and personal belongings, and reducing personal liabilities.  Homeowner’s insurance protects you and your house against losses from fire, theft, liability, vandalism, water damage, wind damage, tornados and loss of use.  Flood insurance must be purchased separately.  As with all insurance policies, it is important to understand the options and choose the policy that meets your needs.

Insurance is a very competitive business and the price you pay for your homeowner’s insurance as well as the service can vary, depending on the insurance company or agent.  Here are some things to consider when buying homeowner’s insurance.

Shop Around:  It’ll take a few phone calls, but the extra effort may save you a good sum of money as well as problems down the road.  But don’t just consider price alone!  The insurer you select should offer both a fair price and excellent service.  Quality service may cost a bit more, but it provides added conveniences.  Checking current client recommendations and the financial ratings of the companies you are considering will give you an idea of the quality of their service.

Raise your Deductible:  Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to pay.  Deductibles on homeowner’s policies typically start at $500.  By increasing your deductible you can save a large percentage depending on the company.

Consolidate your Policies:  Some companies will take an additional 5 – 20% off your premium if you have two or more policies with them.

Consider your Home:  Because of a new home’s electrical, heating and plumbing systems and overall structure are likely to be in better shape than those of an older house, insurers may offer you a discount of 8 to 15% if your house is new.  When purchasing a home, avoid areas prone to floods, this can save you $400 or so a year for flood insurance.  Also take note of the access to fire stations and fire hydrants because this can affect your premium as well.

Insure your House, not LAND:  The land under your house is not at risk from theft, windstorm, fire and other perils covered in your homeowner’s policy.  So don’t include its value in deciding how much homeowner’s insurance to buy.  Your appraisal will show you the value of the house and the value of the land separately.

Home Security:  You can get discounts of at least 5 percent for a smoke detector, burglar alarm, or dead-bolt locks.  Some companies offer to cut your premium by as much as 15 – 20 percent if you install a sophisticated sprinkler system and a fire and burglar alarm that lights at the police station or other monitoring facility.  Because these systems are not cheap and not every system qualifies for the discount, it is a good idea to check with your insurance company before you invest.

Stop Smoking:  Smoking accounts for more than 23,000 residential fires each year.  That’s why some insurers offer discounts if all residents in a house don’t smoke.

Once you Retire:  If you’re 55 old and retired, you may qualify for a discount of up to 10 percent at some companies.

Group Coverage:  Alumni and business associations often have an insurance package with an insurance company that offers discounts for its members.

Re-Evaluation each Year:  You want your policy to cover any major purchases or additions to your home.  Also be sure to depreciate the value of items as they age.  You may want to consider an addition to your policy for extensive personal property.  For your own protection, keep a complete inventory of everything you own.  Support the inventory with photographs and receipts as much as possible.  Keep this information in a safe deposit box in case of a fire. 

Whether you’re buying your first home or you’re ready to downsize, Sandy Luedke of Ideal Real Estate Group has you covered. Dedicated to advocating on your behalf, she will find the best solution for your family. Call her today at (214) 476-1423 to schedule your free home evaluation or visit her online for more information.