‘What ifs’ happens more frequently than what we may originally think of. Your home is a large investment as much as it is a large purchase, and you need to be prepared for any kind of disaster that comes your way. Homes need as much insurance and protection as we do for our health. Some people may believe that it’s just another unnecessary thing to place on your home, but when a flood or twister comes knocking on your door, how are you going to afford all the damage that may be done by these natural disasters? Homeowner’s insurance is sometimes called Hazard insurance and in the U.S.A. Most home insurance is required when taking out a loan for a house. If you don’t have insurance it could lead to penalties and fees.
How do I choose the best homeowners insurance for family and myself? Well, there’s a list of important things to look for. The process may seem overwhelming, and you may be tempted to pick the first insurance and policy that comes at you, but because this is actually a part of your home purchase, it’s best to be picky.
Homeowners insurance comes in several standard forms. The HO-1 is identified as a bare bones policy. It delivers hazard insurance covering z list of “named perils”. It also provides liability insurance. When an owner is held responsible for an accident on his or her property, like if the neighbor/ visitor trip on a misplaced brick, or piece of wood from the stairs, is how liability occurs. This kind of bear bones policy is actually discontinued in many states. The HO-2 covers the owner’s house, personal property, liability insurance, and other buildings on the main property such as shacks and garages. The list of “named perils” is actually a lot broader than the HO-1. The policy covers personal property up to a percentage of the value of the policy, which can be between 50-70 percent. The most commonly used policy today is the H0-3 policy. It has the same features as the H0-2 policy but it also protects homes from damage not excluded like earthquakes, floods, and water seepage. Personal property is only covered from the 16 named perils in the policy.
Cash Value policies pays owners the original purchase price of whatever was damaged. If the owner brought his or her house for $200,000 8 years ago, the most he/ she could claim is $200,000. Even if the appraised value of the house were higher, the owners would still only receive what was put in. A replacement value policy covers the cost of replacing a house or personal possessions, regardless of the cash value or the original purchase price. A $150,000 policy would pay for repairs and replacements up to the policy’s value. A guaranteed replacement value policy will actually cover expenses above the value of the policy.
There are other policies under the HO tags. You can do some digging yourself to find out how they work and what they cover. Some only cover homes that were made of specific time frames and other policies cover mobile homes. Of course dealing with so much sensitive information can be dangerous because of fraud and identity theft is still prominent in 2016, people may be a little skeptical about giving out information to whichever insurance holder you choose to work with, which is why insurance companies have to comply with acts and laws placed out to protect people from these kinds of dangers. Health insurance companies have to follow HIPPA compliance laws to protect the sensitive information their patient’s have. When choosing your insurance company, look back at their history to see if they have had any kind of problems with any of their customer’s sensitive information and give judgment yourself. The most efficient way for an insurance company to remain compliant is through the use of HIPAA compliance software, the software will identify any gaps within their current structure that need to be corrected.