When you start looking into home loans you may find that a lot of lenders will require that you pay for mortgage insurance or mortgage insurance has to be a part of the deal. This is especially true if you get an FHA loan or any type of federally insured loan. You might wonder what this is all about since this type of mortgage insurance doesn’t actually provide you any insurance, but it’s a good deal. While you may be required to keep mortgage insurance for your loan you can also opt for your own mortgage insurance, too!

Home Loans and Mortgage Insurance

Home loans are something that a lot of people dream of having so that they can own their own home. When most of us dream of owning our own home we never fathom that we could get into a position where we are unable to pay our mortgage and run the risk of having our house foreclosed on. While no one ever thinks that this will happen to them, there are millions of people that are losing their homes every year and they never planned on it.

When you are required by home loans to keep mortgage insurance this is so that if you default on the loan the lender will be paid the principal amount due on the loan. Basically, the lender is secured from a possible default through this mortgage insurance, which is why they may have agreed to lend to you even if you have less than perfect credit or have experience bankruptcy or foreclosure in the past.

In addition to the mortgage insurance that is required for some home loans you can also buy your own mortgage insurance that will not protect the lender but will protect you. Many people are able to get this insurance for as little as $50. For $50 you can pay for insurance that will make payments on your home for you if you are laid off from a job, too ill to go to work for extended periods, or even if the primary borrower dies and their spouse cannot make the payments on the house. Wouldn’t it be nice to know that if something happened to you that your home would be paid off?

Mortgage insurance is something that everyone should consider when they are buying a home. While no one likes to think that foreclosure could happen to them, it could. Things happen all the time that we don’t expect such as the loss of a job, an injury or illness that does not allow for us to work, divorce, and even death. These are not the things that most of us can plan for and many times it is loans and homes that are lost because of it. You can protect yourself, your home, and your family with very little each month out of pocket but it could mean saving your home later on. Hopefully you’ll never need to call on this type of insurance coverage, but it’s better to have it and not need it than to need it and not have it. If you have a home loan you should definitely look into this type of coverage because it can be very affordable and it can help you out in a big way when you fall on hard times.

articleclick

Since 1978, the federal flood insurance program has paid out over $11.6 billion in claims. Up to 25 percent of that went to owners of flood damaged property located outside of designated “flood prone” areas. Read on for the basics of the federal flood insurance program.

About the National Flood Insurance Program

Congress created the National Flood Insurance Program (NFIP) in 1968 as the government’s response to the rising cost of taxpayer funded disaster relief for flood victims and the increasing amount of damage caused by floods. The Federal Emergency Management Agency (FEMA) manages the NFIP and oversees the floodplain management and mapping components of the program.

Within participating communities, FEMA is responsible for determining the extent to which flooding might threaten any given area of land. Flooding threat classifications run from minimal to severe, in the case of areas located in “Special Flood Hazard Areas” (SFHA’s).

Over 20,000 communities across the United States and its territories participate in the NFIP by adopting and enforcing floodplain management ordinances to reduce future flood damage. In exchange, the NFIP makes Federally backed flood insurance available to homeowners, renters, and business owners in these communities.

Flood damage is reduced by nearly $1 billion a year through partnerships with communities, the insurance industry, and the lending industry. Further, buildings constructed in compliance with NFIP building standards suffer approximately 80 percent less damage annually than those not built in compliance. And, every $3 paid in flood insurance claims saves $1 in disaster assistance payments.

Flood insurance claims and all operating expenses of the program are paid for through premiums. None of these costs are paid by taxpayers.

Is Flood Insurance Required by Law?

In order to get secured financing to buy, build, or improve structures located in Special Flood Hazard Areas (SFHA’s) you will be required to purchase flood insurance. Federally regulated lenders are required by law to determine if the structure is located in a SFHA and must provide the buyer with written notice that flood insurance will be required. In other words, for properties located in Special Flood Hazard Areas, no flood insurance, no loan.

Structures located in SFHAs have a 26 percent chance of being flooded over the course of a 30-year mortgage. Conversely, the likelihood that a building will catch fire over the same 30-year period is about 4 percent. Consequently, a borrower seeking a mortgage on a structure in a SFHA is more likely to experience a flood at that structure than a fire over the life of a 30-year mortgage.

About SFHA’s and the “100-year Floodplain”

The SFHA is also known as the 100-year floodplain. It is more precisely defined as the floodplain associated with a flood that has a 1-percent annual chance of being equaled or exceeded in any given year. Therefore the SFHA is not a flood that happens once in a hundred years, rather, it is a flood that has a one percent chance of occurring every year. Thus, the 100-year flood could occur more than once in a relatively short period of time.

What About Property NOT in an SFHA?

Should you buy flood insurance on property not located in a Special Flood Hazard Area? FEMA recommends it.

According to FEMA, all areas are susceptible to flooding, although to varying degrees, in fact, 25% of all flood claims occur in the low-to-moderate risk areas. Flooding can be caused by heavy rains, melting snow, by inadequate storm water drainage systems, failed protective devices such as levees and dams, as well as by tropical storms and hurricanes.

Whether your property is located in a Special Flood Hazard Area or not, flood insurance is available to any property owner located in any of the over 20,000 communities participating in the NFIP.

By Robert Longley

about.com

If you’re wondering about insurance before moving, remember that no matter how careful you are in choosing movers, accidents can happen. Boxes can be bumped or dropped or shift during transit and no amount of research will guarantee the safe arrival of your goods. What can be controlled is how effective your moving company is at resolving claims and making sure you’re adequately covered should an accident occur.

Making a Claim

Let me mention up front, in case you don’t get to the end of this article, that if you need to make a claim, before you sign the inventory sheet, report the facts in detail on the original inventory sheet. If you notice damage after unpacking, a claim must be filed within nine months after delivery. Remember that it’s best to report the damage as soon as possible. The mover must acknowledge receipt of your claim within 30 days and must deny or make an offer within 120 days of receipt of your claim.

When making a claim or considering a settlement, refer to the liability amount you declared on your shipment. For example, if the value declared on your shipment was $5,000, the mover’s maximum liability is $5,000. Claims for more than this amount will be declined because they are more than the mover’s liability. Make sure you’re adequately covered.

Types of Insurance

First, it’s good to know that most moving companies automatically provide “valuation” not insurance. Valuation is the predetermined limit of liability as stated on the moving contract or bill of lading. This is automatically part of the contract with no extra cost. In most cases, valuation has no relationship to the actual value of your goods.

So, to know if you’re covered, you need to understand the three types of “valuation” the moving company may provide:

Declared value: The value of your possessions is based on the total weight of the shipment multiplied by a specific amount per pound. For example, if the specific amount is $1.50 per pound, and your household goods weigh 15 000 pounds, the mover would be liable for a maximum of $22,500. The settlement is based on the depreciated value of the damaged goods.

Lump sum value or Assessed Value: If your household goods do not weigh much, but are valuable, you may need insurance that is based more on cost than weight. This means you can purchase insurance for a specific amount per $1,000 of value. This must be declared in writing on the bill of lading.

Full value protection: This coverage includes lost, damaged and destroyed property. The coverage will pay for the repair or replacement of the goods. Usually there is a minimum coverage amount and applicable deductibles.

Now that you understand what kind of “valuation” is available, you’re ready to move onto the next task.

Assess the Value of Your Household Goods

Write down all significant pieces of furniture, glassware, appliances, electronics, cameras, etc…, give each a number and an approximate weight. If you have a large number of books that you’ll be packing into boxes, assign each box a weight. This can be applied to kitchen items, clothes, knickknacks and any other high volume item.

Give each item or box on your list a replacement value. Replacement value means the cost to replace the item with another item of comparable material and quality. The item must be used for the same purpose. This applies unless the cost to repair or replace the damaged item is less.

If you are moving fine art, valuable instruments or antiques, make sure you inform the moving company and apply extra precautions in packing and insuring each item.

Take photos of all pieces, especially items of high or sentimental value. This will assist in keeping track of your inventory and will help if you need to make a claim.

Now add up the number of items, the total weight and the total value. Keep this list on hand when you’re interviewing moving companies. This will help you determine if the moving company is providing enough coverage.

Moving Company Insurance (Valuation)

When meeting with the potential moving company, make sure you check the following:

Determine exactly what kind and how much liability coverage they provide for property loss or damage.
Carefully check the contract for the estimated value of your possessions and match it to your own list.
Determine the maximum value of the mover’s insurance should your goods be damaged. Again, compare it to the total value you assessed from your list. Is it enough? Keep in mind that the amount listed is not guaranteed. Like most things, it is subject to government regulations, taxes and laws.
Ask about the moving company’s process to submit a claim. Find out if they have any outstanding complaints or claims.

Check other Insurance Options

Speak with your home insurance agent to see if your household goods are covered during the move. Most homeowner insurance policies cover approximately 10 percent of the value of your personal property. This includes coverage for breakage and theft in transit. Remember to also check the deductible and take this into consideration when determining your coverage.

Ask your insurance agent about Goods In Transit insurance. You can also purchase “goods in transit” insurance directly from most moving companies, although if you need to make a claim you may prefer to work through your insurance agent. When meeting with your agent, take your list and ask about the various kinds of coverage as listed above to determine how much and what kind works best for you.

By Diane Schmidt

about.com

The first thing you should do when looking into renter’s insurance is to make a list of the items in your house that you want covered in your policy. Items like your stereo, T.V. jewelry, art etc. Anything of value to you is what you want to put on your list. Make sure you write down the serial number of any of the items you are going to insure. Some people even take pictures of these items. If you still have the owner’s manual with some of them, that will help too. Next, you might want to write down any questions you have for the insurance company. You will want to know what kind of protection you are getting for your money. Is your personal property protected against fire, water damage, wind and even theft. Or if your coverage provides living expenses if you are forced to vacate your properly in the event of a flood or hurricane. Also, you want to get coverage for personal liability in case someone gets hurt while on your property. The owner’s insurance will not cover any of this so you need to be sure and ask the insurance provider.

Another type of renter’s insurance you want to find out about is “replacement value”. This type of insurance will actually reimburse you for the actual value of your property rather than the depreciated value. Once you have made your list of items to be insured, and a list of questions for the insurance company, it’s now time to start making your calls.

You can check in your local phone book for a list of companies and you can also ask your friends and family members about the kind of coverage they have. It’s kind of like buying car insurance. You want to get the best coverage for the right price. I’d keep a list of the renter’s insurance company’s I spoke with if I was you. This will prevent you from accidentally calling the same company twice. So write down the name of the company, the person with whom you spoke with and the information you were given regarding pricing and coverage. After you have all the answers you need, then you can sit down and decide which company has the best price and coverage you need for your renter’s insurance.

Buying insurance isn’t an easy thing to do. There is a lot of information you have to gather before making such a decision. Be sure and talk it over with your friends or family. Compare quotes and coverage. Don’t be embarrassed to ask a question. Even if you think it’s a silly question, it never hurts to ask. If you don’t ask, that could hurt you in the end.

http://www.howtodothings.com

http://www.howtodothings.com

By the time you’ve haggled over the price of a new home and endured the financial strip search that is part of getting a mortgage, you may be inclined to go the easy route when it comes to homeowners insurance. That is, you may just leave it up to your friendly insurance agent to find you the best deal.

Bad idea — at least if you want to save money. While an agent may be a valuable resource, shopping around on your own can save you big bucks off your premium — as much as 50%. The reason is simple: By doing your own legwork you eliminate the middleman and his fat commissions. Independent agents are a font of information, but they usually can’t beat the deals offered by an insurer that sells its wares directly over an 800 number (USAA, Amica or American Express, for instance). Even insurers with captive sales forces, like Allstate or State Farm, write cheaper policies. This section will familiarize you with the market so you know where to shop most effectively.

The Phone Folks
So-called “direct writers” are insurance carriers that sell their products directly to customers over the phone, without the benefit — or extra cost — of a fleet of agents. Some of the most active in the home market are:

· AMERICAN EXPRESS (800-535-2001)
· AMICA (800-242-6422)
· USAA (800-531-8100)

It’s very close to a sure bet that the lowest quote you get will come from one of the direct writers. These companies have the lowest selling costs, usually about 21% of premium income, compared with 28% for companies that use agents and 35% for independent insurance agents, according to Conning & Co., a Hartford, Conn., investment firm that specializes in the insurance industry.

There is one problem with direct writers, however. They are extremely selective. Amica gets most of its new business via referrals from existing customers. USAA limits its pool of potential customers to people with an armed-forces connection. American Express looks for new auto insurance customers among its cardholders (though you can call the company and ask for a quote even if you’re not a cardholder). Amex then uses the auto-customer list to target potential customers for homeowners insurance.

Direct writers don’t have an unusually high rejection rate — USAA, for example, accepts more than 95% of applicants. But that’s because they target their customers so carefully. If you are a high risk case, it may be hard to find a direct writer to take your business.

The Captive Sellers
You should also try some of the big guys like Allstate or State Farm. They’re known as “captive sellers” because they employ an in-house, or “captive,” sales force. State Farm is by far the largest home insurer in the U.S., capturing 24.2% of the $24 billion in homeowners policies written each year. Allstate is a distant second, with a 12.5% share. Their local offices are in your phonebook.

These companies pay their salespeople commissions of about 8%, while the average commission at an agency writer such as Travelers is more like 13% to 20%. Because of their low commission structures, the Allstates of the world can often work up quotes that are competitive with the direct writers’.

The drawback to buying from an in-house agent is that he or she won’t offer you as much choice in policies. And, if the company isn’t writing the kind of insurance you need, or it won’t cover high risk cases, the agent won’t be able to help you.

The Agency Writers
For the cost-conscious, this should be your last resort. These are the companies that are represented by high commission independent agents. Among the biggest agency writers in the homeowners market are Travelers, Chubb and Safeco.

An independent insurance agent usually represents six or seven agency writers. A good agent is a storehouse of valuable information and advice, and many people are simply in the habit of buying all of their insurance from their local agent. But because of their high commission structures, the agency writers simply aren’t going to be price-competitive. Say your agent sold you a policy with a $1,000 annual premium. At some companies, $150 of that premium goes back to the agent as commission. If you’d bought the policy from a captive seller, however, the agent would probably get no more than $100.

If agency writers are so expensive, why would anyone buy insurance through an agent? The simple answer is that the other insurers just won’t cover some applicants, or will do so only at discouragingly high rates. An independent agent can sometimes shop around for you and find a deal you’d never find yourself. But it is still unlikely to be a low-cost policy.

http://finance.yahoo.com

In most neighborhoods, an announcement is posted to inform everyone that a new housing development is being built. Once the construction of the houses begin, builder’s risk insurance takes effect. If you have friends or family that are excited because a much needed room is being added to their existing house, builder’s risk insurance should be purchased prior to the renovations. The situations above are just a few indicators regarding the need for risk insurance.

Most people are familiar with homeowners, auto, boat, RV, fire, flood or pet insurance. Builder’s risk insurance is one of the most important types of insurance you can have while your project is in the construction stage. This insurance covers losses or damages to your property while under construction. It also covers materials and equipment being used. Coverage is also extended to materials that are being stored and may need to be moved to the construction site. So while material is in transit from one place to another, it is covered.

Sometimes unforeseen accidents happen that can damage all or most of the new construction, but if you are covered under builders risk insurance, you will be able to recoup some of your losses. Fire, theft, vandalism, wind damage, are some of the things that can happen to new construction. Your builder’s risk policy will outline your coverage along with what types of incidents are not covered. When you make a decision to have something built either as an addition or a new structure, contact your insurance agent and let them know what type of project that you have in mind.

At times people decide to take on what they consider a small renovation project that ends up a major disaster. In addition, some damage may have been done to the existing structure that may cost thousands to repair. For example, you want to add a window to a small room. But instead, some of the supporting beams of the house are damaged in the process. So, it would be wise to seek the advice of a licensed insurance agent no matter how small the project may be. An element of excitement exists when you have completed a small renovation job without any losses. But, what happens when a project is started and you cannot recover from the losses?

Builders risk insurance is only in force until the project is completed. The premiums should not pose a financial hardship. We are in the self- help era, but to go it alone without the proper insurance coverage for your projects is risky business. For most major commercial projects, you will not be able to start construction until builder’s risk insurance is purchased.

No project is too small for you to inquire as to whether builders risk insurance is needed. When possible, ask for an agent that is familiar with builder’s risk because this is not a standard policy.

http://www.howtodothings.com

The risks of faking a home insurance claim

The recession has certainly taken its toll on the bulk of homeowners who have been left reeling by high mortgage rates, increased utility bills and the soaring cost of living. Many, it seems, have been left so desperate by the effects of the credit crunch that they are willing to forego their morals in a bid to make some cash – even if that means breaking the law.

Research by a comparison website has revealed that one in 20 Brits would consider making a false claim on their home insurance. Of these, more than 1.2 million blame the credit crunch for their dishonesty and state that the recession has made them contemplate this route. What’s more is that a fifth of these people claim they have already got the better of their home insurance provider by making a false claim.

Is home insurance fraud a harmless crime?

Insurance companies in general don’t have an endearing image. For the most part they provide a necessary service, but one for which we won’t see any return on our premiums unless the worst happens – and even then there’s no guarantee of a payout.

As such “getting one over” on your home insurer may seem harmless enough. However, the reality is that the consequences can be far-reaching – both for you and honest policyholders.

Fabricating a claim for a payout is illegal and could lead to prosecution. You could also be placed on the CIFAS register, which will harm your chances of getting good rates on financial products in the future. What’s more is that there is an impact for other homeowners too – insurance fraud increases the cost of premiums and so chances are that even if you get away with your false claim, someone is paying for it through increased costs.

If you think the chances of being caught are slim, then think again. The majority of home insurers send out loss adjustors, particularly for large claims. They assess the claim that has been made and look for signs of fraudulent activity. They are highly experienced and if they feel a claim is not justified they can throw out your application and your insurer could even refuse to offer cover going forward.

Honesty the key for home insurance

It’s not just when making claims that honesty is vital with home insurance. It’s important to be completely upfront with your insurer from the moment you take a policy out.

It can be tempting, for example, to tell ‘white lies’ about your circumstances in an effort to keep premiums in check. For example telling an insurer that you have more security devices then are actually present at a home; exaggerating the time you spend in the property; or claiming to a have a guard dog or smoke alarms could all help you save money. However, if you are caught out then your insurer has every right to cancel your policy and charge you for the premiums you should have been paying.

Honest ways to cheap home insurance

If you’re looking to save money, then there are plenty of ways to save on home insurance without being dishonest.

First consider if you’re getting the best possible deal for the home insurance cover you’re taking out. Chances are that if you’ve stuck loyally with the same insurer for several years, you could be getting a better deal elsewhere – even if your insurer’s quote was the most competitive when you took the policy out.

To find out if you could save money, use a home insurance comparison website to compare home insurance policies. The leading websites compare deals from more than 50 providers with one search so you can get an overview of what’s available. Just remember to look beyond price and ensure you’re getting the level of cover you want for your money.

Even if you’re stuck in the middle of a home insurance contract there are still ways to save. For example, most insurers offer discounts to property owners who enhance the security of their home. Installing devices such as burglar alarms, CCTV cameras and time-switch lights could help you save – just ensure you consult your insurer about which equipment will earn the largest discounts. Protecting your home from fire damage too can also be a money saver – so look into smoke alarms and fire extinguishers.

Remember too, that making unnecessary claims can backfire. Most home insurance companies allow you to build up a no-claims discount for every year you go without making a claim – so don’t make too many small claims, particularly if you have a large excess on your policy.

Here’s a bit of insurance trivia for you: Nearly 25% of all claims the National Flood Insurance Program pays out are for policies in low- to moderate-risk areas. This statistic should serve as a reminder that even if you don’t have a beachfront home, or a lovely cottage on a lake, or even a trailer down by the river, you might still want to make sure you’ve got sufficient protection against floods.

If you’re assuming that your home insurance policy covers flooding, you’re probably wrong. Most such policies don’t. In fact, grab a copy of your policy. I’ll wait. You might be surprised by what’s not covered when you sit down to read it. I found out that my own policy didn’t protect me against earthquake damage, so I opted to pay a little extra for that.

Here’s another thing that might surprise you: If you’re watching a TV reporter standing in a rain slicker, describing a hurricane that’s pounding the shore a few states away from you, it’s too late to buy flood insurance to protect yourself from that storm. Flood insurance policies typically take a month or so to kick in.

Here are some good-to-know tips on the topic.

Make an inventory of your possessions.
This is something we should all do, whether we live on the coast, in a desert, or anywhere in between. You never know when some disaster — perhaps a fire — will occur, and if it does, you may need to furnish your insurer with a detailed list of your possessions. Consider taking lots of photos or a video of your home, and make sure to zero in on everything of value. Keep a copy of the documentation somewhere other than your home.

To prepare for the kind of life disruption that hurricanes can bring, make sure you have ample food supplies on hand, along with water and a first-aid kit. Keep important papers stored in a waterproof bag. Stock some batteries and solar-powered lights, along with a bunch of cash, too. (You might not be able to get money from your bank for a while.) Be sure to have a corded phone, since cordless ones won’t work when the power is out. Before the weather ever gets bad, trim any tree limbs that might fall on your property during a storm. And have a pet carrier for Fluffy or Fido.

Keep learning
Learn more about insurance . You may not have thought about some kinds of insurance, such as disability or long-term care insurance, which are vital for many people. And, of course, properly insuring your property is crucial, too. Take a little time to learn more; you may be very happy you did, if some calamity occurs in the future.

http://www.fool.com/

They say that prevention is always better than cure. True. But no matter how well you take care of your belongings and properties, there is still the possibility of loss and damage. You may prevent theft or fire but you can’t prevent natural calamities. This is why aside from getting an auto policy, getting household insurance is a wise move to protect the value of your properties against any harm. Getting informed is the first important step when getting household insurance.

Household Insurance Defined

Household insurance may be defined differently depending on your location or the insurance company. But commonly, household insurance is your security for the contents of your house, the building itself, or both.

Household insurance can be divided into two general types: household content insurance and household building insurance. Remember, you always have the option to buy these two household insurances. However, always consider your situation when deciding whether to get one or both of these household insurances.

1. Household Contents Insurance.

This household insurance covers the entire collection of home properties that can be removed such us furniture, appliances, clothes, accessories, and jewelry. You should buy this kind of household insurance if you are renting a place or living with a friend or family.

Meanwhile, the policies on household contents insurance vary depending on your finance company. This works almost the same as in auto insurance. In most cases, insurance companies cover things that you can take out of your place like laptops, jewelry, or cameras. The damages covered by this type of insurance usually include theft, fire, storm, riot, flood, explosion, lightning, and damage from animals, vehicles, and earthquake.

You can always opt for limited coverage if you want cheaper household insurance. However, doing this is not advisable unless you are very sure that you don’t need a certain item of coverage.

2. Household Building Insurance.

Unlike the household contents insurance, this household insurance covers all the fixtures and fittings in your house. Coverage includes every room in the house, garages, baths, kitchens, walls, roofs, windows, etc. Generally, everything that you cannot bring when you move is included in household building insurance. This insurance covers against fire, lightning, explosion, earthquake, theft, aircraft, or animal accident. The coverage also depends upon your finance company or the kind of household insurance you bought.

Household building insurance is highly important if you live in your own house. But if you are only renting, then leave the building insurance to your landlord and landlady. You are never obligated to insure a building that is not yours or never will be yours.

You should understand that these household insurances do not cover damages caused by negligence, just like in auto insurance. So if you want to get the most out of your household insurance, be it building or contents, you should do regular maintenance and repair of your belongings. Doing this will not only lengthen the lives of your properties but will also save these things from possible rejection from insurance companies. For sure, you don’t want to be left without anything  turn to when calamities, fire, or theft damage your properties.

http://www.howtodothings.com

The reasons why you need to learn about your home warranty coverage are obvious. Without knowing what it does, you may just let some of your big appliances be repaired by somebody and spend more money for it. A home warranty is not free, and that is why you must make the most of it, and knowing what it covers provides you the opportunity to get what your money is worth. Of course, you can easily make a guess on what items are included, something that may be as wild as including everything under your roof. However, you may only end up upset over more limited coverage.

Your warranty corporation should be able to explain the coverage, that is, if you already have a home warranty policy. It is a different case if you are still shopping around for one that can give you the quality service you desire. Nevertheless, it is recommended that you find this out first so that you can pick a good choice. Here are some tips on knowing the details of your warranty.

1. If you happen to have a credible warranty company that has long established itself in the business, it is most likely to have an informative website. Browse its site to get information about the coverage. If it has a FAQ page, read it thoroughly.

2. Some websites may even give you the chance to communicate with an agent in real time, whether it is on chat or online voice call. Therefore, you can simply inquire about the details of your coverage from him.

3. The website may also have a page devoted to explaining the details of a sample warranty policy. You can have a look at it and find out the list of items covered in the warranty.

4. Generally, the big-ticket appliances have warranty protection. These are items that are not just big in size but are permanent and semi-permanent fixtures in the house such as heating systems, plumbing stoppages, and electrical systems. Garbage disposal, plumbing systems, ceiling fans, and built-in microwave may also be included.

5. In some cases, you may have an option to include more items in your coverage such as a clothes dryer, pool, refrigerator, clothes washer, and the garage door opener.

6. The principle that you must remember about your coverage is that only those appliances, system components, and fixtures in your house that can malfunction or stop working frequently are usually covered. Definitely, this does involve your automotive warranty.

These are usually the items on which you can make warranty claims if ever they breakdown. However, you may have some other appliances or fixtures included. Once you know about what is covered, you should not hesitate to avail of the company’s service and make the most of the amount that you pay them.

Step 1
Excess liability insurance coverage (aka, umbrella insurance) is usually acquired by individuals wishing to avert catastrophic financial risk.

Typically, an umbrella policy is purchased over and above the liability limits on homeowners and or automobile coverage.

As an example, assume that your homeowners policy had a $250,000 liability limit on injuries that occur on your property. Seems like quite a bit. But now assume that a neighbor gets electrocuted while helping you string Christmas lights… to that person’s heirs, $250,000 isn’t going to sound like very much money, and you could possibly be forced into bankruptcy should you be sued for much more than your policy limits allowed.

Here is how to decide whether you should contemplate acquiring excess liability coverage, and then how much is right for you.

You are a candidate for an umbrella policy, if you have:

Step 2
Income stream(s).

You may make considerable income from your career and passive activities. A judgment could haunt you forever. In some states, a wage garnishment can snatch 25% or more of your take home pay.

Step 3

Assets or the expectation of assets.

You may already have some net worth, or expect to in the future through inheritance, shrewd money management, etc.

A judgment could lien your property, force the sale of certain assets or lead to the garnishment of your bank accounts.

Step 4

Ethics and moral conviction.

Many people carry umbrella coverage, for ethical and moral reasons.

As an example, the covered would want to make sure that should a party be injured or killed on their property or in a vehicular accident relating to themselves or a spouse or dependant, that the victim and or their heirs are adequately compensated for the loss, whatever the loss may ultimately be.

Step 5

The amount of excess liability coverage is a personal decision, which should be made in conjunction with the advice of your insurance agent and your financial planner.

The cost of umbrella policies are typically fairly low, taking an insured’ s credit rating and claims history into account.

But, you can look at it this way.

If your net worth is $500,000 and you earn $75,000 per year, what would you do if the worst happened and you found yourself expecting to lose a $1,000,000 lawsuit, and you only had $250,000 in liability coverage on your base coverage?

Excluding a bunch of asset maneuvering hocus pocus, which most good lawyers easily get around, the $250,000 coverage would be absorbed, then the $500,000 nest egg would disappear, and then your wages would be garnished for the next 10-15 years, and your credit would be ruined.

This author strives to keep his excess liability coverage under annual review, and makes sure that the premiums stay current.

http://www.ehow.com

For the person who owns a house, it is something that he never wants to loose because he has struggled a lot for that home especially a middle class person. To protect your home the best way is to buy a home insurance policy. You must seriously think about an insured home as it provides insurance of each and every think present inside your home which belongs to you. In case any thing more badly than the worst can happen you don’t have to worry as you have an insured home. You can refund all the things that you have lost.

The price on which you are buying the insurance policy is decided according to your terms and needs. Every person chooses the different kind of home insurance policy so the cost for every one also varies. There are various methods according to which people mainly go for any specific type of home insurance policy. Mainly people buy the insurance policy which is suggested by any one or there friend has the same insurance policy. Some people buy it after considering the option given by there society. Some people just stick to one company and buy all the insurance policies from that company only. The one reason can be the discount they offer on buying multiple policies. The other reason can be may be the company is providing good services on previously purchased policies.

Buying the policy on this basis will never provide you the best home insurance policy and also on cheaper rates. In this way you have not choused the policy according to your needs and also you don’t know whether it will fulfill all your needs or not. You are spending money in buying an insurance policy then it is important to select that policy which you think can satisfy your needs. So spend the money in the best possible way after finding out the good insurance policy. If it is difficult to choose yourself a good policy then visiting the broker’s office is the best option for you.

He can suggest you the good policies that suits your needs and then the final selection depends on you only. There are various things that must be kept in mind while selecting the home insurance because after the total home damage every step has to be repeated from the initial step. So try to select the policy that can provide you the complete coverage.

http://www.articlesbase.com

Home insurance, also commonly called hazard insurance or homeowners insurance (often abbreviated in the real estate industry as HOI), is the type of property insurance that covers private homes. It is an insurance policy that combines various personal insurance protections, which can include losses occurring to one’s home, its contents, loss of its use (additional living expenses), or loss of other personal possessions of the homeowner, as well as liability insurance for accidents that may happen at the home. It requires that at least one of the named insured occupies the home. The dwelling policy (DP) is similar, but used for residences which don’t qualify for various reasons, such as vacancy/non-occupancy, seasonal/secondary residence, or age. It is a multiple line insurance, meaning that it includes both property and liability coverage, with an indivisible premium, meaning that a single premium is paid for all risks. Standard forms divide coverage into several categories, and the coverage provided is typically a percentage of Coverage A, which is . The insurance policy itself is a lengthy contract, and names what will and what will not be paid in the case of various events. Typically, claims due to floods, or war (whose definition typically includes a nuclear explosion from any source) are excluded. Special insurance can be purchased for these possibilities, including flood insurance. Insurance must be updated to the present and existing value at whatever inflation up or down, and an appraisal paid by the insurance company will be added on to the policy premium. Fire insurance will require a special premium charge, plus the addition of smoke detectors and on site fire suppression systems to qualify.

The home insurance policy is usually a term contract—a contract that is in effect for a fixed period of time. The payment the insured makes to the insurer is called the premium. The insured must pay the insurer the premium each term. Most insurers charge a lower premium if it appears less likely the home will be damaged or destroyed: for example, if the house is situated next to a fire station, if the house is equipped with fire sprinklers and fire alarms. Perpetual insurance, which is a type of home insurance without a fixed term, can also be obtained in certain areas.

In the United States, most home buyers borrow money in the form of a mortgage loan, and the mortgage lender always requires that the buyer purchase homeowners insurance as a condition of the loan, in order to protect the bank if the home were to be destroyed. Anyone with an insurable interest in the property should be listed on the policy. In some cases the mortgagee will waive the need for the mortgagor to carry homeowner’s insurance if the value of the land exceeds the amount of the mortgage balance. In a case like this even the total destruction of any buildings would not affect the ability of the lender to be able to foreclose and recover the full amount of the loan.

The insurance crisis in Florida has meant that some waterfront property owners in that state have had to make that decision due to the high cost of premiums.

This essential home owners insurance coverage, which protects your dwelling and possessions against a wide variety of perils, offers a number of options. You’ll need to determine the full value of your property, buy the right type of coverage, and have the proper levels of protection within that policy. You might need supplemental coverage for such “high-ticket” items as jewelry or computers, or for protection against natural disasters, that the basic policy might not cover.

However, these policies varied by insurance company, and were difficult to comprehend. The need for standardization grew so great that a private company based in Jersey City, New Jersey, Insurance Services Office, also known as the ISO, was formed in 1971 to provide risk information and issued a simplified homeowners policy for resell to insurance companies. These policies have been amended over the years until currently, the ISO has seven standardized homeowners insurance forms in general use:

The seven basic types of Home owners insurance coverage apply in all states except Texas:

HO-1: Basic Home owners Insurance. A basic policy form that provides coverage on a home against 11 listed perils; contents are generally included in this type of coverage, but must be explicitly enumerated. The perils include fire or lightning, windstorm or hail, vandalism or malicious mischief, theft, damage from vehicles and aircraft, theft, explosion riot or civil commotion, glass breakage, vandalism or malicious mischief, smoke, volcanic eruption, and personal liability. Exceptions include floods, earthquakes.

HO-2: Basic Homeowners Insurance Plus, Broad Homeowner Policy. Protects against losses against the 11 basic perils in HO-1, plus six more: Falling objects, weight of ice, snow or sleet, three categories of water-related damage from utilities or appliances, and electrical surge damage.

HO-3: Extended or Special Homeowners Insurance, All Risk Homeowner Policy. Covers the 17 stated perils of the HO-2, plus any other peril not specified in the policy, except for Flood, Earthquake, War, and Nuclear Accident. This description applies only to the dwelling. Personal property is covered only for the named perils, though special coverage on contents is normally available by endorsement. Some companies might offer a policy for “high value” homes that includes special form coverage on contents. The typical, most comprehensive form used for single-family homes. The policy provides “all risk” coverage on the home with some perils excluded, such as earthquake and flood.

HO-4: Renters Insurance.The “Tenants” form is for renters. It covers personal property against the same perils as the HO2. Covers personal property only from the 17 HO-2 perils.

HO-5: All Risk. Covers building and personal property. This is rarely sold.

HO-6: Condominium Owners Insurance coverage.The form for condominium owners. Covers personal property, together with building items in which the condo owner might have an insurance interest, from the 17 HO-2 perils.

HO-8: Basic Older-Home Coverage. Covers repairs or actual cash values, not rebuilding costs, to the dwelling and personal property from the 11 HO-1 perils. Designed for homes whose history or architecture make replacement cost significantly higher than market value. The “Modified Coverage” form is for the owner-occupied older home whose replacement cost far exceeds the property’s market value.

According a 1998 NAIC report, 83% of homes were covered by owner-occupied homeowners policies. Of these, 87% had the HO3 Special and 9% had the more expensive HO5 Comprehensive. Both of these policies are “all risks” or “open perils”, meaning that they cover all perils except those specifically excluded. 3% were the HO2 Broad, which covers only specific named perils. Others include the HO1 Basic and the HO8 Modified, which is the most limited in its coverage. HO8, also known as older home insurance, is likely to pay only actual cash value for damages rather than replacement. The remaining 13% of home insurance policies were covered by renter’s or condominium insurance. Two-thirds of these had the HO-4 Contents Broad form, also known as renters insurance, which covers the contents of an apartment not specifically covered in the blanket policy written for the complex. This policy can also cover liabilities arising from accidents and intentional injuries for guests as well as passers-by up to 150′ of the domicile. Common coverage areas are events such as lightning, riot, aircraft, explosion, vandalism, smoke, theft, windstorm or hail, falling objects, volcanic eruption, snow, sleet, and weight of ice. The remainder had the HO-6 Unit-Owners policy, also known as a condominium insurance, which is designed for the owners of condos and includes coverage for the part of the building owned by the insured and for the property housed therein. Designed to span the gap between the coverage provided by the blanket policy written for the entire neighborhood or building and the personal property inside the home. The liability coverage may cover incidents up to 150′ from the insured property, all valuables within the home from theft, fire or water damage or other forms of loss. The Associations Bylaws determine the total amount of insurance necessary. In addition, about 2.4% of homes were covered by a dwelling fire policy which which covers property damage to a structure and is typically sold to noncommercial owners of rented houses. It may also cover the owner’s personal property (such as appliances and furnishings). The owner’s liability is generally extended from their own primary home insurance, and does not comprise part of the Dwelling Fire policy.

Most homeowners buy HO-2 or HO-3 insurance policies.

There are variations on these policies. For example, landlords can buy coverage that insures a building only and not personal property (which would be covered by a Renters policy). You can get special Mobile Home Insurance policies to cover manufactured houses.

Coverages

For each policy, there are typically six classifications of coverage. These are based on standard Insurance Services Office or American Association of Insurance Services forms.

Section I – Property Coverages

Coverage A – Dwelling
Covers the value of the dwelling itself (not including the land). Typically, a coinsurance clause states that as long as the dwelling is insured to 80% of actual value, it will be replaced. This is in place to give a buffer against inflation. HO-4 (renter’s insurance) typically has no Coverage A, although it has additional coverages for improvements.

Coverage B – Other Structures
Covers other structure around the property which are not used for business, except as a private garage. Typically limited at 10% of the Coverage A.

Coverage C – Personal Property
Covers personal property, with limits for the theft and loss of particular classes of items (eg, $200 for money, banknotes, bullion, coins, medals, etc). Typically 50 to 70% of coverage A is required for contents, which means that consumers may pay for much more insurance than necessary. This has led to some calls for more choice.

Coverage D – Loss of Use/Additional Living Expenses
Covers expenses associated with additional living expenses (i.e. rental expenses) and fair rental value, if part of the residence was rented, however only the rental income for the actual rent of the space not services provided such as utilities.

Additional Coverages
Covers a variety of expenses such as debris removal, reasonable repairs, damage to trees and shrubs for certain named perils (excluding the most common causes of damage, wind and ice), fire department changes, removal of property, credit card / identity theft charges, loss assessment, collapse, landlord’s furnishing, and some building additions. These vary depending upon the form.

Exclusions
In an open perils policy, specific exclusions will be stated in this section. These generally include earth movement, water damage, power failure, neglect, war, nuclear hazard, intentional loss, and concurrent causation (for HO-3)

With most home insurance, you are required to prove that your personal property claim happened due to one of the named perils listed on your policy. However, there are premium policies where the only way you won’t get reimbursed for personal property damages is if the peril is specifically exempted from your policy.

Perils
Peril is “insurance speak” for specific dangers that could cause damage to your property. For instance, a burst pipe, fire, hurricanes or tornadoes are all perils. Named perils means the perils you are covered for that are specifically mentioned in your insurance policy. If you are covered for all perils except those mentioned as exemptions, you are getting an open perils policy.

The HO5 Difference
The most common policy, HO3, regards all risk to the actual building structure of your home, meaning you’d be insured for any peril that could happen to the outside of your home. All risk is also called “open peril,” because unless a specific peril is excluded you are covered. However, your personal property, the contents of your home, i.e. your stereo, computer and furniture, are only covered by named perils in an H03 policy.

In an HO5 policy, both personal property and your home are covered under an open perils policy. Thus, if you have a claim due to anything that causes damage to your personal property within your home, you wouldn’t have to prove that it happened because of a named peril. For instance, if your roof develops a water leak and your property is damaged, you do not have to prove that it happened based on a reason covered by your policy, such as hail. If the peril is not specifically excluded, you are covered.

Perils Covered by Traditional Policy
There are 16 named perils that are generally insured against in a typical H03 (traditional) policy. This covers most incidents that can happen, and is good enough that most people end up with this policy in order to avoid higher insurance premiums. Some of the perils included on an H03 are vandalism, damage from thawing ice, mold, theft and volcanic eruption.

Reasons to Get an HO5 Policy
If you have fantastic credit and the difference in price is relatively small, HO5 policies give you no fuss, no muss insurance, because the burden of proof for any personal property claim lies with the insurance company.

Valuing Your Property
The benefit of having an HO5 policy is that you are covered in additional circumstances for damage to your personal property. So, whether the extra cash is worth it or not is a matter of how much your stuff is worth. Go around your home with a pad and paper and write down everything you own. Make sure to include serial numbers because you will need this for your insurance company if you ever have items stolen from your home.

Write down what you think each item is worth. Then go online to find replacement values if you bought the same item new. Total the values and now that you know what your stuff is worth, you can decide whether you need an HO5 policy.

An HO5 Policy by Another Name
The name for a policy can vary from state to state. If you are looking for an HO5 policy, it’s important to explain to the insurance agents or brokers that you are looking for a policy that includes all risks or open peril coverage for personal property.

Questions You Should Ask About Any Policy
No matter whether you choose an HO3 or an HO5 homeowner’s policy, you should ask your agent or broker these questions:

What are the exemptions? Even if you have an HO5 policy, you could have exemptions – items not covered in your policy – for a few items.

Is replacement value or cash value covered? If you are covered for replacement value instead of cash value, you are paid enough to buy the item new instead of what the item is worth at the time it is damaged.

Conclusion
HO5 policies protect you from your insurance company not reimbursing for certain types of personal property damage. However, choosing this policy depends on how much your possessions are worth, and if you can afford the additional premium. No matter what insurance policy you choose, ask specific questions about what items are not covered. You don’t want to shell out the extra cash for an HO5 policy and then discover that what damages your property is the one thing that is not covered.

by Reyna Gobel, MBA

http://www.investopedia.com

Depending on policy options and the provider you choose homeowners insurance rates can vary by hundreds of dollars. Here are some ideas how you can lower your homeowners insurance rates.

1. Compare Homeowners Insurance Rates
Compare homeowners’ insurance rate quotes to determine, if you are getting a good homeowners insurance rate. You can save money on a new policy, comparing homeowners’ insurance rates from different providers. You can get multiple homeowners insurance rate quotes quick and easy with online comparison services that you can find in the internet.

2. Security Features Can Lower Homeowners Insurance Rates
Hundreds of thousands home robberies are committing every year. So you understand that homeowners insurance companies will offer lower homeowners insurance rates to homeowners who install safety and security features. It means if you want to lower homeowners insurance rates install smoke detectors, security systems and deadbolt locks.

3. Homeowners Insurance Rates: Discounts
You can feel protected from theft, vandalism, and other damage with your homeowners insurance. It doesn’t mean that you have to pay easy money for the protection. Don’t forget about discounts, they may help you to save your money. For example smokers should pay more for homeowners insurance, if you gave up smoking you can apply for lower insurance rates.
For retired individuals many companies offer homeowners insurance rate discounts of up to 10%. For permanent clients who stay with company for 3-5 years some companies offer ‘loyalty discounts’ of 5%, and 10% for clients who stay with them longer than 6 years.

Insurance companies offer discounts for homes that have security system, sprinkler system, and deadbolt locks. Make sure to let you insurance agent know that you have those.

When buying a house make sure it’s in a low-risk area. Some areas are at high risk for natural disasters and other areas have higher insurance costs because of the higher crimes.

Estimate your insurance needs from a reasonable viewpoint. Insure your dwelling and other items for the amount- you will want everything to be replaced in the result of a disaster.

Sustain a good credit rating. Most of the insurance companies base their premium prices on a policyholder’s credit score. By paying your bills on time each month and having good credit score you can get a better price for your home insurance policy.

Try not to make claims, unless it’s necessary and make sure your potential claim will cost more than your deductible. Each claim makes it possible for your premium to go up.

Increasing your deductible to 1500-5000 that way you can save hundreds of dollars each year on your premium payments.

Buying a home involves more than just making sure you have homeowner’s insurance coverage. If you’ve recently purchased a home, here are some types of insurance that may be impacted by your recent move.

Homeowners insurance

If you have a mortgage, your lender probably required you to obtain some level of homeowner insurance coverage. However, you’ll want to make sure that the amount of coverage that you have will adequately protect you for all possible losses. Homeowner policies set coverage limits for specific items (jewelry, business papers, furs, etc.), so you may want to look into purchasing a separate endorsement or a floater if you feel that you need to increase your coverage. You also need to know if you have “replacement cost” coverage on your personal property and if you are covered for earthquake damage.

Flood insurance

Homeowners insurance does not provide coverage for flood damage. But those living on a riverbank or near the ocean are not the only ones who warrant flood protection. Even if you live in a low-lying area (e.g., near a creek), you may want to look into purchasing flood insurance. Most companies that sell homeowners insurance also sell flood insurance, so try contacting your own insurance company for more information.

Auto insurance

There is connection between buying a home and auto insurance. If you’re ever in an auto accident that is the result of your negligence, all of your assets (including your home) could be subject to liability claims if the claims exceed the liability limits of your auto insurance policy. So, you should re-evaluate the existing liability limits on your auto insurance policy to make sure that you have adequate coverage to protect your home. If you feel that you need even more coverage, you may want to look into purchasing a separate umbrella liability policy, which would pay for damages that exceed the coverage limits on your auto and/or homeowners insurance policy.

Disability insurance

Would you be able to make your monthly mortgage payments if you were unable to work due to an accident or illness? A disability insurance policy will pay you a monthly benefit to replace a portion of your income until you are able to work again. Many employers provide disability insurance for their employees. If your employer does not offer disability insurance or if you are self-employed, you can purchase an individual disability policy.

Life insurance

What if you were to die before your mortgage was paid off? Would your family be able to keep up with the remaining mortgage payments? Life insurance can provide your family with the funds to pay off their debts, as well as replace a portion of your income. While many employers offer some level of life insurance coverage to their employees, this amount of coverage may not be enough to provide financial security to your family. So, you may want to consult an insurance professional to help you assess your family’s life insurance needs.