by onlinefinancialnewsletters | Oct 9, 2014 | Personal Protection
Do you own a home? If so, you probably pay for homeowners insurance. It’s likely your mortgage lender required you to show proof of coverage before you closed on your loan. And if you’re among the lucky Americans who own their homes outright, you may still have insurance to protect your investment in case of damage caused by fire and wind, property theft or liability lawsuits. You may even be aware that you can cut your premiums by installing and maintaining smoke detectors and security systems as well as insuring your vehicles through the same company. But do you know about the many other credits available to reduce the costs of homeowners insurance?
Gated Community Credit: According to Bankrate, if you own a home within a gated community, you may be able to shave 5 percent to 20 percent off your premium. The discount falls under loss mitigation, as the extra security of such a location makes your property a less attractive burglary target.
New Wiring Credit: According to the National Fire Protection Association (NFPA), electrical failures and malfunctions contributed to an estimated 47,700 home fires in 2011—causing $1.4 billion in direct property damage. If you’ve purchased an older home, you may qualify for a 10 percent credit on your insurance premium if you replace the wiring.
Impact-Resistant Roofing Credit: The average roof takes a beating in the form of rain, hail and wind, and damage caused by compromised roofing can lead to significant home insurance claims. As a result, many insurers offer homeowners a 5 percent to 10 percent discount on premiums if they upgrade to an impact-resistant roofing material (such as Class 4 impact-resistant UL 2218).
Claims-Free Credit: According to Bankrate, if you’ve gone a decade without filing a claim, your insurer may be willing to knock as much as 20 percent off the annual cost of your coverage. If you’ve been with the same company for years but have had a claim or two in the past, you may still qualify for a long-term customer discount.
New Home/Home Renovation Credit: Buy a brand new property and you could score an insurance premium that is as much as 25 percent less than that required for a comparable previously owned home. You can earn the same discount if you renovate an older property. However, check with your insurance agent for suggestions on maximizing credits before you begin.
Non-Smoker Credit: Data compiled by the NFPA shows that smoking caused an estimated 17,600 home structure files in 2011. These fires resulted in 490 civilian deaths, 1,370 civilian injuries and $516 million in direct property damage. While insurers generally raise their rates if there is a smoker in the household, many will also give you a 5 percent to 15 percent discount if you keep your home smokeless.
Retiree Credit: Retired homeowners tend to spend more time at home, and this means they are more likely to be able to prevent an emergency—such as a gas leak or broken pipe—from becoming a disaster. According to Bankrate, if your household includes an adult who is 55 years or older and retired, you may qualify for a discount of 10 percent to 25 percent.
Homeowners insurance costs vary based on many factors including your location and the coverage you select. Contact your agent today to review your policy and learn if you qualify for any of these cost-reducing credits.
by onlinefinancialnewsletters | Sep 10, 2014 | Personal Protection
Mother Nature can throw one heck of a punch. And as residents on both coasts and across the mid-west have learned, you don’t want to be on the receiving end of her wrath. Unfortunately, she seems to be striking out more often than ever, drenching parts of the U.S. in a series of extreme one-day precipitation events that lead to flooding—the most common, and most costly, form of natural disaster according to FEMA. In fact, over the past several years, about 60 percent of all declared disasters involved flooding.
Just because your home has never flooded in the past does not mean it won’t in the future. According to FEMA, a home in a high-risk flood area—termed a Special Flood Hazard Area or SFHA by the government—has a 26 percent chance of flooding during a 30-year mortgage term. However, 25 percent of all flood insurance claims paid by the National Flood Insurance Program (NFIP) are for properties outside of SFHAs.
If your home happens to flood, insurance may be all that’s standing between your savings and financial ruin. According to the NFIP, just a few inches of water can cause tens of thousands of dollars of property damage. In fact, from 2008 to 2012, the average residential flood claim was more than $38,000. And you can’t count on your homeowner’s insurance policy for assistance.
What is Flood Insurance?
A supplementary policy used in conjunction with homeowner’s insurance, you can purchase flood insurance through your insurance agent from the NFIP. If you live in a moderate to low-risk area, premiums start as low as $129 per year for your home and its contents. Premiums for SFHA areas are obviously higher. While flood insurance is not required for everyone, you’re required to purchase a policy if your home is in a high-risk area and you obtained your mortgage through a federally regulated or insured lender.
What Does Flood Insurance Cover?
Flood insurance from NFIP covers your home and its foundation, the electrical and plumbing systems, central air and heating equipment, water heaters, large kitchen appliances, window blinds and permanently installed carpeting, paneling, wallboard, bookcases and cabinets. If you live in a low-risk area and have a preferred risk policy—or have purchased additional personal contents coverage in a high-risk area—the insurance will cover your personal belongings (clothing, electronics and furniture), curtains, portable appliances, carpets not included in the building coverage, washers and dryers and freezers.
What Doesn’t Flood Insurance Cover?
A NFIP flood insurance policy does not cover damage caused by moisture, mildew or mold. It also does not cover currency, precious metals or valuable papers. Additionally, any belongings outside the structure are not covered (including cars), nor are temporary housing expenses or financial losses caused by interruption of a home business. Coverage is limited in basements regardless of zone.
You can determine whether you’re in a low or high-risk flood area by reviewing the flood maps at FEMA’s Flood Map Service Center or by consulting with your insurance agent. Don’t take a chance with Mother Nature. Talk to your agent about obtaining flood insurance today. There’s typically a 30-day waiting period before policy purchase and beginning of coverage.
by onlinefinancialnewsletters | Aug 27, 2014 | Personal Protection
According to a National Fire Protection Association (NFPA) report that examined data collected between 2007 and 2011, U.S. fire departments respond to an average of 366,600 home structure fires per year. These fires cause an estimated average of 2,570 civilian deaths and 13,210 civilian injuries. They result in $7.2 billion in direct property damage.
If you believe you’ll never experience a home fire, the odds are against you. The NFPA Fire Analysis and Research Division states Americans can expect to average a home fire every 15 years or five fires in their lifetime. While most of these fires will be small, cause little to no damage, and go unreported, you have a one in four chance of experiencing a home fire that requires fire department assistance.
Fortunately, you can improve your family’s chances of surviving—and protect your structure and other belongings—by following these tips:
Cook with care – Never leave the kitchen while you are frying, grilling or broiling food. Additionally, do not leave items on or in your oven to simmer, bake, roast or boil while you’re away from home. If you must leave—even to run to the store or pick up your kids from school—turn off the stove.
Don’t crowd space heaters – Space heaters need exactly that: plenty of space. Whether fixed or portable, position your space heater at least three feet from anything that is flammable. Additionally, always turn off your space heater when you leave the room or go to sleep.
Quit smoking ASAP – While cooking equipment is by far the leading cause of home fires, smoking materials cause the most home-fire deaths. If you must smoke, do so outside whenever possible. Additionally, you should always utilize a sturdy, deep ashtray (whether inside or out) and never smoke in bed.
Hide matches and lighters – If you have children in your home, keep all matches and lighters out of their reach. Even better, store them in a cabinet with a childproof lock.
Inspect all electric cords – Carefully examine all the electric cords in your home, from the ones attached to your electronic equipment and kitchen appliances to the extension cords you use in your garage. Never use a cord that is cracked or damaged, has a broken plug, or sits too loosely in the outlet. Replace it instead.
Never leave candles unattended – Place candles at least one foot away from anything that can burn. Never leave candles burning when you leave a room or go to bed or unattended around children or pets.
Create a fire escape plan – Make sure your family is ready should a home fire occur. Create an escape plan for every room in your home. Have a fire drill to practice your escape at least twice every year.
Install (and maintain) smoke alarms – From 2007 to 2011, 37 percent of home fire deaths occurred when no smoke alarms were present. Twenty-three percent occurred when smoke alarms failed to operate. Smoke alarm failures are usually the result of missing, disconnected or dead batteries.
Make sure you have at least one smoke alarm on every level of your home as well as inside every bedroom. For the best protection, the NFPA recommends homeowners use combination ionization and photoelectric alarms. You should test every alarm at least once per month, change out batteries at least once a year, and replace smoke alarms every 10 years.
While even a small home fire can be disconcerting, a larger event could destroy everything you own. Whether you need a fire insurance policy or want to review your coverage, contact your insurance agent today.
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