Financial expert Rachel Langlois from Cyprus Credit Union talks about the benefits of insuring your home.
Here are some tips she mentions:
- Credit score matters, can affect premium pricing. Low credit pays on average 32% more.
- Bundle coverage
- Understand your coverage:
You need additional coverage for floods or earthquakes if in risk areas.
Most plans cover open perils, unless excluded
HO5: open perils (covers all, unless stated), burden of proof on insurance company
HO3: typically covers 16 named perils, claimant must prove coverage. Perils include:
- Fire or Lightning
- Falling Objects
- Volcanic Eruption
- Windstorm or Hail
- Riot or Civil Commotion
- Damage caused by Aircraft
- Vandalism or Malicious Mischief
- Damage due to weight of Ice, Snow, or Sleet
- Sudden & Accidental Tearing Apart, Cracking, Burning, or Bulging
- Sudden & Accidental Damage from Artificially Generated Electric Current
- Accidental Discharge or Overflow of Water from Plumbing, Air conditioning etc.
Cash value vs replacement value coverage
- - Cash value will provide market value, so what the item was originally worth less depreciation.
- Replacement value will provide funds needed to completely replace item at current prices.
Maintaining Your Policy
- Keep current with maintenance. Claims can be denied if it was due to neglect.
- Inform insurer if you make improvements that increase home safety, such as alarm systems
- Create home inventory
- Belongings, what you paid, serial numbers
- Video/Photos of contents of every room, closets and cabinets
Making a Claim
- Some items have coverage limits/caps, consider adding riders for high value items
- Personal items may be covered outside of home, but often at smaller percentage
- Don`t make small, frivolous claims
Average premiums increase by 9% after one claim
Stays in database (CLUE) 7 years, view yours for free every 12 months (at LexisNexis)
Even talking to an agent about a claim can be noted on your account
- Reporting window of 14 days