Last week we had a chance to dive into auto insurance and some of my top tips for understanding your auto policies. This week we will take a closer look at homeowners insurance to not only make sure you have the proper coverages, but that you are maximizing your ability to get a lower rate.
Home insurance tips:
-Water back-up coverage refers to the coverage on your policy if your sump pump backs-up or you have water damage from backed up drains. The average water back-up claim is $9,600. I typically recommend a minimum of $10,000 on my policies, however, make sure to consult with your agent on increasing that amount based on needs specific to your home.
-Whenever running a new quote for your home, ask your agent to list the insured who has the high insurance score first. When more than one person is listed on the deed to the home, the person you typically list first on the insurance policy will receive the higher discount.
-If you have a swimming pool, trampoline, or wood burning stove in your home, and you have not shared that, you are at a high risk of not being covered in the event of a claim. Our carriers will cover the scenarios listed above and there is often little change in premium but will need to be properly documented prior to the policy being issued. Added on one of the following after issuance? Make sure to consult with your agent to make a policy endorsement to add the risk to the policy.
-Updating your roof and heating and cooling systems can offer a great discount! The highest discounts that can be applied in most cases to a homeowners policy are renovations.
-Have you added on an in-home security system lately? Make sure to notify your agent of the addition of deadbolts, burglar alarms, and other security devices that help monitor and keep your home safe. These will often provide discounts on your homeowners policy. For example, an alarm that connects to police, fire, or other monitoring stations can save you as much as 20% on your homeowners premium.
-Make sure to know exactly what type of electrical wiring and plumbing you have in your home. This can also be a crucial and potentially cost saving question to ask prior to purchasing a home. There are very limited carriers that will cover older plumbing, such as galvanized piping, and older electrical, such as “Stab-Lok” breakers.
-When considering the dwelling coverage on your home, keep in mind you are not using the market value of what you could sell your home for, you must consider what it would cost to rebuild your home using building materials and construction costs. A crucial coverage to carry on your policy (usually included with most carrier packages now) is extended dwelling coverage. This is a percentage the insurance company with factor into the rebuild amount in addition to the initial replacement cost. This usually ranges from an additional 25-50%.
-The most common deductible for homeowners insurance is $1,000. If you are looking for ways to save on your policy, have a conversation with your agent on increasing your deductible amount. This will typically walk hand in hand however with the insured being diligent in setting a small amount of money aside for home repairs that will fall below that deductible amount. Avoiding filing small claims will save you hundreds of dollars on the back end in the years to come on your renewal policies.
-If you have valuable items such as jewelry, fine art, cameras, collectables, etc. you can add those to your homeowners policy, but keep in mind that a claim with these items also goes against the homeowners policy as a whole and may result in higher premiums come renewal time.
-Own a pet? Certain dog breads may come with a surcharge with some companies. Other breads may be ineligible entirely with certain carriers. Make sure to disclose any pets you may have with your agent before moving forward with your policy.
Other policy questions in the meantime? Make sure to reach out to myself or any of our amazing team members at VantagePointe Risk Management!