Question: Why do I need homeowners insurance?
Answer: Your home is probably the greatest investment you will ever make and while no one can predict what will happen in the future, it is wise to put as many safeguards in place as possible. Homeowners insurance is a great way to protect you, your family, and your property from damage caused by fire, certain natural disasters, injury, burglary and theft, and death caused by unforeseen accidents.
Question: What happens if I don't have homeowners insurance and a fire, accident, death, or other disaster happens on my property?
Answer: If you don't have insurance on your home and there is a catastrophe, you will be held personally liable to rebuild, replace, or demolish your home. Without homeowners insurance, you may not be able to rebound from your losses and you may find yourself in a great financial hardship.
•If you still have a mortgage on the home, you will still be responsible for making the payments.
•If someone gets hurt on your property, you will have to pay all medical expense out of your pocket, or get sued in court.
•You may face challenges from the city or county in which the property is located.
•Most people don't have the tens of thousands of dollars in their savings, or under their mattress, to replace a home, or even repair it, if is destroyed or severely damaged.
Question: How much does a homeowners insurance policy cost?
Answer: The price of homeowners insurance will most likely differ with each insurance company because the cost is based on each company's past loss experience.
Question: What is the loss experience?
Answer: The loss experience is the amount of money the insurance company has had to pay out in past on claims that have been filed against it.
Question: How do I determine which company offers the best rates and the best policy for me?
Answer: The best way to get the best insurance rates is to shop around and ask lots of questions. Ask friends and relatives which company they use and ask them how they feel about their rates and services.
Question: How do I determine the best coverage for me?
Answer: The best way is to ask questions and don't take the first answer as the best answer. Compare rates, policy coverage, and if you want more information about the best coverage for your area, call your state's Department of Insurance.
Remember, the cost of insurance will be higher if you live in what is deemed to be a high risk area. And if you decide to add riders on to your homeowners insurance to protect against things that are not already included in your policy, look to pay a higher premium.
Most insurance companies offer discounts if your home has smoke detectors, fire alarms, sprinklers, burglar alarms and other safety devices. It is prudent of find an insurance agent or broker who is willing to take the time to sit down with you and explain in detail what his company is offering and to answer any questions you might have.