Is there such a thing as cheap home insurance? There may be a better question. Is home insurance really that expensive? Homeowner’s insurance may very well be the consumer’s best buy when it comes to insurance. There are multiple benefits and features that make the home policy unique. Most everything that the homeowner owns including the dwelling can be covered in some way by homeowner’s insurance. When you think of the magnitude of the coverage afforded by homeowner’s insurance versus the premium paid then you would have to agree that homeowner’s insurance is a very good buy. The rates on property insurance in general, have increased over the last ten years. Much of that has to with increased catastrophes like the hurricanes in Florida. The toxic mold problem that originated out west has also caused premiums to increase on a national basis. The home insurance buyer really needs to focus on a few areas to get the most for the premium dollars paid. Accurate Dwelling Amount – This is the first most critical decision that you will make. The square footage of your dwelling has to be correct in establishing the replacement value of your home. The market value is of little use to you when you purchase insurance to rebuild the structure. Replacement cost is better for homes that have been built within the last 40 years. Check with your insurance company underwriting guidelines. Replacement Cost or Actual Cash Value – This facet of your home insurance policy should be clearly understood. Replacement cost insurance on both your dwelling and its contents means that the insurance company will rebuild or replace your loss with like kind and quality. Actual Cash Value will calculate the replacement cost and then subtract for depreciation. The actual cash value policy is cheaper but you will have to come up with the depreciable amount out of your own pocket. Deductible – Higher deductibles bring your premium down substantially. $500 to $1000 deductibles are common. This is a huge savings to you over the years and is your most valuable tool in lowering the cost.
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What is the best homeowners insurance for you? The answer is probably not that obvious to you because most of us have not taken the time to understand our homeowner’s insurance. We would much rather turn that responsibility over to the insurance professionals. There is nothing wrong with that approach but it still leaves you a little bit too uninvolved over a very important insurance purchase. People have a natural fear of the unknown. We like to steer clear of things that are unfamiliar to us. Our insurance is often one of those things that we would rather just avoid. That may come in part from the old days when insurance was purchased under pressure from the insurance agent. That method of sales has just about vanished in property and casualty insurance. People willingly contact agencies about policies and coverage. The agent is more like a consultant these days. The best homeowners insurance is usually purchased when we ourselves have a better understanding of our policy and how we want to be serviced. The insurance atmosphere is much more professional and there are more ways to purchase insurance. Purchasing online or by telephone is becoming as common as purchasing from the local agent. The homeowner’s policy itself has a couple of integral features and benefits to consider. Buying replacement cost insurance verses actual cash value insurance is one of your most important decisions. Replacement cost homeowner’s policies settle any loss by replacing or repairing your dwelling and its contents with like kind and quality without depreciation. Actual cash value allows for depreciation and expects you to make up the difference as an out of pocket expense. The most important cost savings decision that you will make is the size of the deductible. It makes sense to have as high a deductible as possible on your home policy because of the infrequency of claims. The best homeowner’s insurance for you revolves around how you want to do business, whether to purchase replacement cost or actual cash value, and the size of your deductible. These three areas will lead you in the right direction. Last year the UK's average premium for Buildings Insurance increased by 1% to just over £205 and the average for Contents Insurance rose to £151, up 2%. But within the market we've seen some much bigger rises – if you're with Norwich Union you'll have seen your premium rise by around 6%. So what's going on? Every year we see premiums rising. Surely with so much competition in the home insurance market, you wouldn't expect to see such inexorable rises in premiums? Let's consider the situation more carefully. The cost of repairing and rebuilding houses is a reflection of the rising price of labour and building materials. This means that cost to the insurers of claims under the buildings cover similarly rises. So as their costs rise, so do your premiums. And there's also the indisputable fact that cost inflation also affects the insurance companies own operating costs. Wherever possible, they're bound to add a little extra on for that! Then there's that lovely British weather. Michael Fish could be forgiven for believing we don't live in a hurricane zone, but nevertheless it's a fact that storms, and especially floods, are becoming ever more frequent. Flood damage can be particularly destructive with, according to the Association of British Insurers, the average insurance claim ranging between £15,000 and £30,000. And during the last 18 months we have seen particularly destructive floods create headline news at Helmsley in North Yorkshire, Carlisle, and Boscastle in Cornwall. Those events must have cost the insurance companies multi-millions. The other area where costs have been rising is burglary. The average burglary claim has now risen to around £1,400. There seem to be two reasons – firstly burglars are finding pickings easier to come by and move on. Modern family homes are packed with valuable electronic gismos – from laptops to I pods, digital cameras and flat screen TV's. The other reason is that burglars are targeting well-off neighbourhoods more and more. Against this background the insurance companies are able to price home and contents insurance down to individual postcodes. If their records show a problem with flooding, or subsidence, or an increasing incidence of burglary in you immediate area, their computers will load your premium to reflect the additional risk. Your no-claims discount will only serve to offset these upward pressures to a certain extent. And don't forget that once you have a five years no-claims record, your discount doesn't increase, it's capped. Thereafter, all the premium increases will land fully in your lap. So what can you do to save money? The most important step by far, is to shop around every year for the best available deal. Maybe it's a chore, but thirty or forty minutes on the Internet (including ten minutes on this web site!) will yield you results. Within that space of time you'll have found the cheapest insurer and, as an online customer, you'll probably have qualified for an additional 10% discount. Then you can always agree to pay by direct debit – that'll also trim off a bit more. Of course there are other things you can do, especially in the arena of home security. Join the local neighbourhood watch scheme, install security locks on your windows, fit external security lighting, up-grade the locks on your doors and get a burglar alarm. Added security will earn you discounts on your insurance but will cost you money to install! Perhaps the added peace of mind alone will be worth the cost. Only the local neighbourhood watch scheme arrives free! The best general rule is don't stick with the same insurance company too long. Keep them on their toes. They have a tendency to take loyal customers for granted. Yes, it really does pay to shop around – try it and prove it to yourself! BY ANGELA GREILING KEANE, BLOOMBERG May 6, 2014 (Bloomberg) -- More than half the U.S. population lives in coastal areas that are “increasingly vulnerable” to the effects of climate change, which will ripple throughout the U.S. economy, a White House advisory group’s report concluded. The report released today enumerates the impact across the U.S., including a 71% increase in heavy rain and snow in the Northeast during the past half-century and an increased risk from hurricanes linked to higher sea levels.
Earthquakes, floods, and other disasters can seriously disrupt normal life. Services may not be available, transportation may be cut off and roads may be blocked. In some cases, you may be forced to evacuate. Be ready to respond to any situation by assembling and maintaining a Disaster Supplies Kit. Click 'Read More' below for the Disaster Supplies Plan. At our Cape Cod Insurance Agency, located in Falmouth, MA - we offer 15 home insurance carriers for your coastal houses. Navigating life's big decisions and developments can be challenging... buying your first home or boat, getting a new car, choosing the right policy to protect yourself and your family on Cape Cod. Those are the moments when all roads lead to Calfee Insurance. We are your local insurance answer to help you, protect you and insure all that's important to you. We understand Cape Cod life, because we're living Cape Cod lives. To learn more, Click Here HB3370, Grimm/Waters Homeowner Flood Insurance Affordability Act of 2014, passed the Senate last night 72-22 and is anticipated to be signed by the President within the next 10 days. Some important highlights include:
HFIAA14 directs FEMA and the NFIP to modify BW12 Flood Reforms already in place as well as to modify the future implementation of BW12 Flood Reforms. A Congressional Summary of HFIAA14 is available to read more. We appreciate your interest and involvement in the political process, to see how your Senator voted, click here to see how your Representative voted, click here. |
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