Homeowners insurance, otherwise known as fire insurance or hazard insurance is insurance for your house. It protects your house from many dangers, such as fire or wind damage, as well as protecting your contents or belongings from fire, theft, or other damage. Homeowners insurance also provides you and your family with personal liability coverage. So when your son bangs his bike into your neighbor’s brand new car, you are protected.
But how much should you insure your home for? And who determines that?
Your home will generally have three different values: (1) how much you are taxed on, (2) how much you can sell it for, and (3) how much it will cost to rebuild it. These values are never the same. A driving factor in the value of your house is its location. My good friend built a waterfront vacation home on Lake Winnipesaukee in New Hampshire for around $300,000. The home is currently valued at over $1.5 million! Location, location, location….

Another factor in determine the value of your home is how much land is included in the property. Obviously 10 acres is probably going to worth more than acre, but what kind of land is it? Are 5 acres undevelopable wetlands? And again, you guessed it, where is it located?

When you first purchase a home, the bank is going to want you to insure the house for the amount of your loan. Many times, they won’t even take into account the value of the land, which will still be there even if the house completely burns down. The insurance company wants to insure your house for the replacement cost. They do not want to underinsure you, nor do they want to overinsure you.

To determine the value of your house, many insurance companies have developed cost estimate tools. They generally need to know how old the building is, how many finished square feet it contains, how many stories, what type of roof (gable, gambrel, etc), what type of construction (frame, masonry), what type of siding (vinyl, aluminum, clapboards), etc. The more detailed the questions, the more accurate the estimate will be. Is your kitchen a basic kitchen, or does it have custom cabinets, granite countertops and a ceramic tile floor?

The insurance company will also accept a replacement cost estimate from a licensed contractor in the area. Many times the bottom line on how much you need to insure your home for depends upon what the bank will accept. It is very important that you talk with both your bank and your insurance agent. It would be foolish to overinsure your house and pay for coverage you will never receive, but it would be just as bad to underinsure and save a little money and risk a large shortfall in the event of a catastrophe.

Douglas T. Zinkevicz has had over a decade of experience servicing the auto,home and life insurance needs of his clients.Let him help you with your insurance questions by visiting http://www.insuranceplus.blogspot.com.

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House insurance is among the most important insurances you can get - and in the case of buildings insurance, most mortgage lenders make it compulsory. This is because your home is your biggest asset and if you lose it because of fire, flood or another disaster and you have a mortgage outstanding on it, there may be nothing tangible to repay back your mortgage with.

There are two types of household insurance - buildings and contents. These can also be purchased as individual plans or combined. If you buy the insurance combined (ie from one insurer) they you tend to get an overall discount.

Buildings insurance gives your property (and it’s fixtures and fittings which are permanent fixtures such as fitted kitchen or built in wardrobes) financial protection in the event of damage. Unless your mortgage provider insists you have cover, this insurance is still strongly recommended as it protects probably your most major asset.

Contents insurance - while not compulsory - is just as important as buildings cover. Again, it offers protection against fire, damage, loss etc. and will cover most of your possessions in the home from baby clothes to DVDs to audio equipment to valuables (up to a set limit which your insurer will define).

If you have something particularly valuable (such as an expensive watch) - or something you take outside the home and that is more liable to damage or theft (eg a bicycle or a laptop) contact your insurer to see if you need to upgrade your policy. This should only mean a small increase in your house insurance premium and will give you the peace of mind that the item is covered.

As with all insurance products, when looking for house insurance, do shop around for the most competitive premium. Online insurance brokers, where you enter your details and requirements just once and the search engines goes off and finds the best deals for you, are free and easy to use and give you a good idea as to how much you should be paying.

As with all product comparisons, when it comes to house insurance, do compare premiums on a like for like basis to ensure you get the level of over you need.

Jason Hulott is Business Development Director of Protection Insurance. Protection Insurance is an internet based insurance business dedicated to getting consumers the very best insurance rates and the best products. We have a range of free insurance guides Download them here

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Anyone who owns a home will, at some point in their ownership, come to realize the importance of their homeowner’s insurance policy. Homeowner’s insurance policies exist to protect both the homeowner and the bank lender, at least for the life of the home’s mortgage.

Basic Policy

The basic homeowner’s insurance policy covers damages done by such disasters as fire and severe storms, including hurricanes and tornados. Damage to your home, property, and possessions are typically the basic elements covered. However, the amount of coverage you carry for each is perhaps the most important aspect of the plan.

Possessions that are lost due to theft are also generally covered, up to a certain percentage of the insurance policy.

Liability coverage is another basic element of a general homeowner’s policy. Liability protection covers the policy holder for damages done to another’s home or property, even the damage done by one’s pet can be included. However, this is only damage done to another’s property. The homeowner’s policy does not cover damage incurred by the policy holder to his or her own property or possessions.

Covering Yourself

Many consumers fail to recognize the pit falls that are inherent in many homeowner’s insurance policies. For the most part, it is generally known that the basic homeowner’s insurance plan does not cover flood damage. While most homeowners consider themselves safe and on dry ground the majority of the time there are many who are at risk. Whether you realize it or not, you might actually live in a flood zone. And then again, even if you do not, when severe disaster hits, such as a hurricane that generates dangerous and inevitable flooding, you might become the unwitting victim of flood damage and the holder of a policy that fails to cover your damages.

Homeowners must be wary when purchasing their homeowners insurance. Make sure you buy from a reputable insurance agent and do not make your policy decisions based solely on getting the bargain basement price. A bargain basement homeowners’ insurance policy will likely fail to cover you when a real disaster strikes. Just a piece of paper on which you have spent money, but now fails you. Buy wisely. Your home and property are your biggest investment and must be regarded as being worth the added protection. Discuss with your insurance agent all the possible circumstances that are truly realistic for your situation. Make sure your general homeowners policy carries plenty of coverage that allows for a total rebuild of your home if necessary and replacement of important possessions. Buy a standalone flood insurance plan if you are advised to do so.

Documentation

Make itemized lists of possessions. Take photographs of treasured family heirlooms and items you would like replaced in like value if they were to become stolen or ruined in a fire or storm. Videotape the rooms of your home, making a visual document that literally walks through your home and property. Then make sure to keep such important documentation safe either in a safety deposit box or in a fire proof safe in your home. Such documentation becomes the only proof when property and possessions are ruined or stolen.

Sara Chambers is a marketing consultant and an internet content manager for
http://www.homeownersinsuranceblog.com

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