Did you know that if your car is broken into and contents are stolen, practically every item not attached to the vehicle is covered by your homeowners insurance and not your car insurance? For example, if you have a bunch of CDs sitting in your glove compartment and a thief gets to them, you have to file a claim with your homeowners insurance and not your auto insurance for those CDs! You would still have to file a claim with your auto insurance, in case there was damage to your car or just as a matter of protocol, and file a police report so that there is a public record of the theft; however the actual claim for contents would need to be filed with your homeowners insurance!
The reason for this is because homeowners insurance covers your property whereas automobile insurance doesn’t. Comprehensive coverage only covers damage to your car, you will have to turn to homeowners and rental insurance to recover losses related to property.
According to the Insurance Information Institute, or III, “the average cost of insuring noncoastal residences in 2008 is expected to be up just 2% to 4% in many areas and flat or even falling in others.” The reason is because the property and casualty insurance industry is experiencing the down-trend of their market cycle and and increase competition. Competition is heating up in every insurance area, including car, business, and homeowners, except for those in hurricane-exposed areas. The losses in those areas in 2006 and 2007 were a fraction of the $62B lost in 2005 (mostly because of Hurricane Katrina).
So, shop around and you might be able to find a better deal.
Source: TheStreet.com
There’s a great article in WSJ Online that discusses some new security systems that allow you to monitor from afar on the internet. This is something a lot of home brew security systems have offered, online access, but this is the first I’ve heard of a professional system offering that level of service.
The second part of the article discusses localized systems that monitor parts of the house, such as the gun box or the liquor cabinet. A sensor is a sensor is a sensor, whether it’s an open door or an open cabinet, sensors can monitor either.
Tomorrow is Valentine’s Day and chances are you will be giving (or receiving) a piece of jewelry on the wonderous day that is February 14th. If you do, consider getting a jewelry rider to cover you in the event that piece is loss. In fact, and this is something to remember for next year, get that piece of jewelry insured before you gift it to your loved one. There is no reason you need to wait until after you give it away before you get a rider, plenty of things can happen between now and then.
So, on this Valentine’s Day, remember insurance and maybe it’ll save you from some heartache in the future. (If he or she breaks up with you, unfortunately insurance won’t cover that!)
Buying a home can be very stressful, so it’s not surprising that some people would confuse mortgage insurance with homeowners insurance. The two are very different.
Mortgage insurance is usually purchased by the borrower, on behalf of the lender, to protect the lender against the borrower defaulting on a mortgage. It is also known as private mortgage insurance, or PMI, and is generally required if the borrower puts down less than 20% on their down payment. The borrower can get a second mortgage and avoid PMI but if he or she gets a loan for 80%+ then a lender will require it. PMI recently was made tax deductible.
Homeowners insurance, which is what this site is about, covers the borrower in the event of damage or loss in their home. If your house burns down, homeowners insurance protects you. If someone breaks into your house and steals something, homeowners insurance protects you.
Hpefully the difference is clearer now.
If you own a “dwelling unit” (that is a home), in a condominium type arrangement then you’re going to need what’s known as condominium unit owners insurance, which is slightly different than homeowners insurance. Condominium unit owners insurance is different in that with condominiums, the structure and building are insured by another party. This could be a condominium association, a townhome association, a cooperative, a homeowners association, a planned community, or similar organizations that do that sort of thing. You’ll know before you buy whether you’re going to be subject to that sort of arrangement.
Since the structure and buildings are covered by another insurance policy, condominium unit owners insurance may be cheaper because it covers less. So, the types of things that condominium unit owners insurance will not cover is flood damage, earthquake damage, damage caused by the building settling or damage caused by animals. While flood and earthquake aren’t typically covered by homeowners (you’ll need a rider for those), the list of exclusions on a condo insurance policy is larger than on your typical homeowners policy.
So, when you do your home insurance search, remember that condos (and coops and other similarly organized dwelling units) fall under a different type of insurance.
If you see yourself in a short term tight financial situation and you’re concerned that a catastrophe in the home could wipe you out, then you could consider lower your insurance deductible. By lowering your insurance deductible, your monthly payments will increase but your deductible will be lowered. That is, in the event of a catastrophe, the amount you need to pay for, before insurance kicks in, will increase. This prevents you from a large payment but forces you to make smaller individual payments, it’s a trade-off you must make and for you to decide whether its right for you.
For example, let’s say you are concerned that your deductible of $1,000 is enough to put you in a tough spot. You could lower that number to $500 and then pay the extra monthly payments for that added protection. That means that in the event someone causes $5,000 of damage to your home, the cost to you is $500 instead of $1000.
If you want to save monthly costs, raise your deductibles. If you want to reduce your exposure to risk and are willing to make the payments, lower your deductibles.
Now that you understand the various parts of an alarm system, you’re probably considering getting an alarm system for your home. Picking an alarm is actually quite easy, it’s merely a matter of surveying your home, getting a bunch of quotes from local providers, and then getting the system installed.
Questions a security system provider will ask:
- How many windows and doors would you like alarmed?
- Do you want active monitoring?
- Do you have any pets or actively roaming individuals?
After they’ve asked those questions and determined the right system for you, always ask for a written quote for the system. You’ll want to comparison shop and getting things in writing will save you some headache later. After you’ve selected on, you need to start thinking about where to put the sensors (such as motion sensors) and where to keep the panels. You’ll likely want one at your front door, maybe your back door, and maybe up in your bedroom. Remember, those panels will activate and deactivate your system.
I know it sounds a little silly but one of the easiest things you can do to ensure your home is secure is to double check your windows and doors every single time you leave your apartment, condo, or house. A lot of times you’ll open a window or unlatch your sliding back door, go outside, and then pull it closed behind you - forgetting to lock it up because you aren’t going anywhere. Then, a few hours or a day later, you leave without thinking about the door … and you have unlocked doors and windows giving open access to your home. See how easy it is to leave your house exposed? If you have an alarm, it’s not that bad because the alarm system will still protect you (and let you know if you left the sensor tripped), but it’s easier to prevent access in the first place.
Do you live in a gated community? Did you know that you can get a discount on your homeowners insurance if you live in a gated community? Experts claim that the discount is somewhere in the neighborhood of 10%, so if you are in a gated community be sure to tell your insurance representative. This makes sense because the amount of random traffic, that is traffic by people who don’t live in the community or aren’t visiting someone in the community, is going to be a little lower so the risk is lower. It is even better if your gated community has active security personnel monitoring the gates (as opposed to a few hours of active security plus swipe access) so be sure to tell your insurance representative of your situation.