Your home is likely to be the biggest asset you will ever have, so protecting it against disaster makes perfect sense. In fact, if you have a mortgage you won't have a choice - your lender will require you to have insurance to cover the cost of rebuilding your home in the event of a fire or other crucial damage. Don't rely on the coverage levels mandated by your bank or mortgage company. Those levels are designed to protect the house itself, but not necessarily your possessions. That's why it's important to check with your agent or insurance company, to make sure you have adequate coverage.
Consider the following homeowners insurance suggestions and tips:
- Shop around. But don't consider price alone. The insurer of your choice should offer a fair price and deliver the quality service you would expect if you needed assistance in filing a claim.
- Raise your deductible. The higher your deductible, the more money you can save on your premiums.
- Buy your home and auto policy from the same insurer. We' will give you 18% percent discount on auto and 10% discount on home insurance.
- Do not use your insurance policy as a "maintenance policy." If little things are broken try to fix them yourself. Filing several small claims may cause your rates to rise or have your policy canceled. Be aware of the importance of monitoring home maintenance issues.
- Invest in your home security. You can usually get discounts for a smoke detector, burglar alarm or dead-bolt locks. Some companies offer to cut your premium by as much as 15 or 20 percent if you install a sprinkler system and a fire and burglar alarm that rings at the police, fire or other monitoring stations.
- Do not miss a discount. Companies offer several types of discounts, but they don't all offer the same discounts in California. That's why you should ask your agent or company representative about any discounts available to you. For example, since retired people stay at home more than working people, they are less likely to be burglarized and may spot fires sooner. Retired people also have more time for maintaining their homes. If you're at least 55 years old and retired, you qualify for a good discount at some companies.
- Be a prudent homeowner.
- Keep your property free of hazards that might damage your house.
- Stop smoking. Smoking accidents account for more than 23,000 residential fires every year. Some insurers offer to reduce premiums if no one in the home smokes.
- Be a responsible dog owner. 40% of Americans homes have a dog. There are 4 million dog bites per year, and dog bites create 33% of all homeowner liability claims - resulting in more than $1 billion in claims per year. So, Train your dog and Keep your dog on a leash when walking.
- Safeguard your home. Take action to make your home theft-resistant. Install exterior lights that are out of reach and triggered by motion. Trim trees and shrubs near doors and windows. Don't hide house keys outside. Consider investing in a security system.
- When you're on vacation: Have mail and newspapers picked up. Leave blinds in normal positions. Arrange to have your lawn mowed or your driveway shoveled. Tell police and neighbors that you will be away and ask them to watch your home.
- Be loyal to the insurer. If you've kept your coverage with a company for several years, you may receive a special discount for being a long-term policyholder.
- Review the limits in your policy and the value of your possessions at least once a year. You want your policy to reflect the value of your home and belongings.
- When you are buying a home, consider the cost of insurance. Choosing wisely could cut your premiums by 5 to 15 percent. Before you make the final decision on purchasing a home, call your insurance agent and ask them to check the Comprehensive Loss Underwriting Exchange, or CLUE report. This keeps track of claims filed on homes and lists 27 different kinds of losses. If the previous owner filed too many insurance claims, it could cause your rates to be higher.
- Be aware of the risks not covered. Read your insurance policy to find out exactly what is and is not covered. Flood insurance and earthquake damage are not covered by a standard homeowners policy.
- Protect your home business. Home businesses are generally not covered under your homeowners insurance policy. You may have only limited property coverage and no liability coverage for your business under your homeowners policy. Research coverage for property and equipment damage or theft, loss of income, and general liability for customer and supplier injuries.
By The Way: More than 40 percent of consumers would like their homeowners insurance carrier to offer coverage for identity theft, according to a study released by J.D. Power and Associates. We have it available just at the cost of $12 a year.
The study also finds that a large proportion of homeowners do not carry enough insurance to rebuild their homes if destroyed, with more than 25 percent of homeowners believing they are underinsured.
Twenty-six percent of homeowners think they have a guaranteed replacement cost policy, while 25 percent do not know what kind of policy they have. Approximately 50 percent of homeowners incorrectly believe the insurance company or their agent -- not themselves -- bear the responsibility for determining the replacement cost of their home and its contents