MY HOME INSURANCE IN USA

Home insurance in the USA is a serious necessity. It is not a luxury. The average cost of my home insurance in the USA ranges between $1, 500 per year or about-$140 per month. The most expensive USA states for home insurance as at 2003 includes, Kansas, Oklahama and Nebraska while the least costly includes; Delaware, Hawaii and Vermont. This is dependent on the scope of insurance coverage; the risk associated my kind of building, the age of my home, the location, presence or absence of mortgage debt, the amount of my premium and other factors.

My home insurance in the USA is important not just because it protects my home and my possessions against damage or theft but for other benefits offers. One of these other benefits are that it serves as security for my mortgages as virtually all mortgage companies require borrowers to have insurance coverage to perfect mortgage transactions. Secondly, I may not be able to secure a bank loan or from other financial institutions without a home insurance coverage for the full or reasonable value of a property (usually the purchase price).

Meaning of my home Insurance in USA

My home insurance in USA is a class of insurance policy that protects my home against destruction and damage to it. The coverage protects my home’s interior and exterior, possessions etc. it further protects me against personal liability in the event of damage or injury to third parties who make use of my home.

There exists three basic levels of coverage that I can buy for my home and they are; actual cash value, replacement cost, and extended replacement cost/value.

Determinants of Premium Rates

As earlier stated above, the costs of this insurance Policy will depend on the level of the risk, inflation, age of the property, the value of my property and others. The insurer will usually assess the risk in my home on the basis of past claims with respect to the same type of my home, the risk of natural disaster, the neighbourhood and the general condition of the home. This assessment is important because while Insurers are there to pay claims, they’re also in the business to make money. Thus, if the nature of my home is same with a home that has made multiple claims in the past, it can make my premium very high. In some extreme cases, the Insurer may even decline to accept my offer to insure.

In a similar vein, my neighbourhood and its crime rate, and building material availability will also make part of the factors for consideration by the insurer before accepting my insurance proposal or the rate of payable premium. Other coverage options such as deductibles, riders for art, wine, jewellery, etc will equally be a factor for consideration. Also, the amount of coverage is also a factor that will determine my annual premium rate.

How to reduce the cost of home insurance premium in USA

By maintaining adequate security system in my home
Seeking policy discounts
Through increase of my deductible
Engaging in renovation/maintenance works
Mortgage debt pay ups
By making regular policy reviews and comparisons of different Insurers

Home Insurance Companies comparison tips

Speak to other policyholders
Do a check of existing Policyholders’ satisfaction
through making wide comparison of costs and insurers
Do Insurer health check
Find out about the insurer’s claims response to older policyholders
Know that price of premiums does not guarantee good insurance coverage

Different levels of insurance Coverage for my home

There are essentially three levels of coverage.

Actual cash value coverage

This is my home insurance coverage for cost of my home and the value of my belongings after deducting the value of depreciation.

Replacement cost coverage

This is the type of coverage that covers its actual cash value and my belongings in my home. Take note that this does not deduct depreciation. This type will let the insurance company replace my home to the original value.

Guaranteed replacement cost/value

This is the most comprehensive type of my home insurance in USA. And It pays for whatever it will cost to repair or rebuild my home notwithstanding that such cost may be more than the limit of my coverage limit.