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“Insurance Savings Advice & Tips On How To Save Money On All Your Insurance Needs”
HOMEOWNERS INSURANCE -
Deciding on Coverage & Deductible Amounts (continued)
quickly decide to settle the claim, leaving you totally on your own with respect to any claims over and above the insurance company’s settlement. Also, if you are considering buying an “Umbrella” liability policy to provide even more liability protection, you will probably need to buy at least $300,000 of liability coverage in your homeowner’s policy.
c. Umbrella liability policies are generally available if you want more liability protection than can be purchased in your homeowner’s policy. They provide personal liability coverage over and above both your homeowner’s coverage and your automobile liability coverage. Coverage amounts are often available in varying increments up to a total of $2 million or more. The decision to buy an Umbrella policy is not as much dependent on whether you feel you may cause someone harm (who knows the future), but what assets you have to protect.
4. While the amount of certain types of coverage, such as liability and various endorsement coverages, can be changed in order to reduce annual insurance premiums, the premiums saved may not be worth the additional risks taken. The exposure could be large. Remember, insurance should be used to shield you from large, unaffordable losses, that would be financially debilitating or devastating. However, often premiums can be reduced considerably by increasing deductible amounts.
a. While higher deductibles do increase exposure to loss, the additional exposure is generally manageable, and the annual savings of lower premiums may be worth the additional risk. Many people also feel that higher deductibles are just fine, since they do not plan on reporting small losses in any case, because they feel the insurance company may raise their rates if these claims are reported. If you feel this way, a higher deductible may be even more attractive.
b. Keep in mind, the same deductible (except for special catastrophic events) is generally applied to losses on your dwelling, personal property and loss of use, and deductibles are available in varying amounts, from very low amounts to thousands of dollars. Ask your insurance company what the premiums are for different deductible levels, and make your decision on what is right for you.
5. Deductibles for catastrophic events such as hurricanes, earthquakes, etc. are often set by the insurance company at much higher levels than for “ordinary” losses. Make sure you understand just what these deductibles are, and if they can be raised or lowered, and what impact that has on premiums.
6. The cost of Identity fraud Protection is usually not large. If you are concerned about your exposure in this area, ask your insurance company about the particulars.
Getting Discounts on Homeowners Insurance
Several discounts are available for homeowners insurance. Make sure you discuss with your insurance company all potential discounts that are available, so they can be included to reduce your premiums. And make sure you understand what all the added charges and endorsements are for, and if you really need them. Insurers are famous for assuming you want certain types of coverage that you may not consider necessary.
1. If you have a fire and/or burglary warning system discounts are available, particularly if the system is monitored by a central station monitoring company. Other protective devices like fire extinguishers, dead bolts, etc. may also provide discounts.
2. If your home is relatively new (usually less than ten years old) or has recently been fully renovated, you may receive a new home discount.
3. If your home meets certain building codes you may receive a discount. Additionally, if your city or county participates in a building code enforcement program an additional credit may be available.
4. If your home is made of fire resistant materials like brick or masonry discounts may be available.
5. If you live in a coastal state, you may receive one or more discounts on the cost of hurricane and windstorm coverage if you have a windstorm inspection of your home done by a certified inspector. Some states even have a program that provides free inspections for homeowners. Check with your insurance company for details.
6. If you are a non-
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