Homeowners Insurance Coverage
Your basic policy
will probably cover only $2,500 of business equipment, about enough for a computer and printer. If you've got more, consider a rider. Outside structures. Usually, a policy covers separate buildings for up to 10 percent of the house's insured value. That may not be enough if you have a stable, a pool house, or other complex buildings on your property. Backup of sewer and drains. This peril's generally not covered, either by basic homeowner or by a flood policy. Consider an endorsement, advises Chubb's Ritterson. "A big thaw caused a backup in my parents' house one winter," he says. "It was uncontrollable-and uninsured, leaving $15,000 worth of damage.
Their carrier had such an endorsement available, at about $30 a year; they hadn't asked for it." Watercraft. If you own boats, find out what coverage your policy includes. Dog bites. They account for one-third of all homeowner claims, says Hartwig, and insurers are tightening their rules and even refusing coverage in some cases. Better find out what a policy will or won't cover. With some bad-rep breeds, such as pit bulls, you might find the dog has eaten your coverage. Indeed, so many factors affect coverage - from layout (alarm system, fencing, yard, pool) to lifestyle (household residents, pets, activities) - that you should consider having an insurance agent visit your home before you finalize or update a policy. An expert is likely to spot insurance issues that you might miss. You can cut cost without losing value Compared with some other types of insurance, homeowners coverage is relatively inexpensive.
Annual Premiums for Home Insurance
Typically, the annual premium for an American home is $1,000 to $1.500, says Salvatore. "Even guaranteed replacement coverage, if you can get it, may cost only 10 percent more," she adds. Moreover, you can often cut costs by raising your deductible. "Going from $250 to $500 typically saves 12 percent on the premium. Go to $1,000 and you'll save 24 percent," Salvatore says. A $2,500 deductible might push your savings to over one-third. The price you pay for a lower deductible is steeper than you might think, says John Burns. "Let's say your premium is $800 on a policy with a $250 deductible, but you could switch to a premium of $700 and a $500 deductible. You should do it. The first way, you're really paying $100 more for only $250 extra in coverage. That's not a very good deal." Increasing a deductible, in other words, may not mean taking on much additional risk. Indeed, you may add almost none, given the catch-22 of insurance:
Making a claim is often bad strategy. "Most people absorb small losses anyway, since having a number of them means you may have your coverage canceled," observes Salvatore. You can reduce costs in other ways, too. Having a security system can cut your premium - by as much as 15 percent, with a high-end system, says Salisbury. And the savings could help pay your monthly alarm-monitoring cost. Or you could save 10 to 12 percent if you buy auto and home coverage from the same insurer. You might cut the cost of umbrella coverage that way, too.
Call the Ed Cuellar Insurance Agency for Home Insurance Questions