Frequently Asked Questions
- Local construction costs
- The square footage of the structure
- The type of exterior wall construction — frame, masonry (brick or stone) or veneer
- The style of the house (ranch, colonial)
- The number of bathrooms and other rooms
- The type of roof and materials used
- Other structures on the premises such as garages, sheds
- Fireplaces, exterior trim and other special features like arched windows
- Whether the house, or parts of it like the kitchen, was custom built
- Improvement to your home — adding a second bathroom, enlarging the kitchen or other additions that have added value to your home
- Fine Jewelry and Collectibles
- Home Office Equipment and Home Businesses
- Identity Theft
- Excess Liability (Umbrella)
If you have an actual cash value policy, it will not. Actual cash value is also known as the fair market value. Fair market value is basically the amount that a buyer would pay for your home and is normally an amount lower than the current cost to rebuild the home.
With a replacement cost policy, the chances that you will be able to completely rebuild your home are better. But, there are many types of replacement cost policies, so you need to be careful to purchase a replacement cost policy that best meets your needs. One example is a guaranteed replacement cost policy. This type of policy is the only one that will pay to completely rebuild your home. Other types of replacement cost policies will pay your policy limits, plus a certain percentage above those limits. Don't forget about building code upgrades coverage. Cities and counties periodically change their building codes. If you don't have this coverage, and you need to change the structure of your home to keep it current with building codes then your insurance company may not pay for changes.
- Car/Home Discount: Insuring your car and home with the same company often will give you a package discount. This is a good tool to use when shopping around. Usually the agent can tell you what percent the discount is for insuring your car and home together.
- Deductible: In some cases it makes sense to raise your deductible for the savings it may generate.
- Home Security Systems: Special burglar alarms can prevent losses and therefore make your house less of an insurance risk. Most any type of security system will help give you a discount, but the type that directly responds to local police and fire departments are most likely going to give you the most discount.
- Dead Bolt Locks: Most agents will ask you this, but check again to make sure you are not losing a discount if you already have them. If you don't, it is well worth it. Dead bolt locks are very inexpensive compared to the possible insurance savings, but make sure all of your doors have them because usually the discount only applies if there are dead bolt locks on every door.
- Smoke Alarms: Preventing a fire loss is important to you and your insurance company. Claims due to fire are very expensive and insurance companies often will give an additional discount for even one fire alarm permanently fixed in the home. Please, even if your company does not offer a discount, take the time to install one anyway.
- Sprinkler System: While adding a sprinkler system (the fire suppression type not the lawn watering type) to a home may be costly, if you have considered it a discount is just another reason to do so. This would also be a something to consider if you are buying a new home or have plans to build or remodel.
- Non-Smoking Household: In looking for the most favorable types of customers, insurers look for those people who pose the least risk. Since a large percentage of accidental fires are caused by smoking, some insurance companies give a discount for non-smoking households. To qualify you would probably need to have a home in which you don't let anyone else smoke in the home in addition to the homeowners being non-smokers.
- EFT Payments: Many companies are now charging up to $5.00 or more for mail payments, but sometimes nothing if you choose to have payments automatically deducted from your bank account. Sometimes the deductions can come from your credit card, so you don't have to worry if the money will be in your bank account when payment time comes.
- Credit Rating: Most companies are checking your credit and basing some part of the cost of your policy on the strength of your credit rating. Make sure you check to see if your credit is in good shape, and if it is not, you may want to seek out companies who do not do credit checks.
- Additional Discounts: There are many additional discounts that may be available such as a reduced senior rate or being in a gated community or condominium. Make sure to sit down with your agent on a regular basis, preferably right before your policy renews, to see if there are any additional discounts available to you.
Insurance products are not insured by the FDIC or any federal government agency and are not a deposit or other obligation of, or guaranteed by, any bank or bank affiliate.
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