House Insurance Agency
A house insurance agency is an office that sells homeowners insurance products for an insurance company. Insurance agents are licensed to sell specific products and must pass exams to earn their credentials. They are licensed by state.
Every state has some variety of overseeing body led by an insurance commissioner. For a listing of your state, visit the National Association of Insurance Commissioners.
You may be familiar with the terms insurance broker and insurance agent. The two titles are differentiated by the breadth of insurance companies with which they work. An insurance agent sells only one company's products, in general, while an insurance broker scours a variety of different insurance companies' products to sell policies to customers.
Insurance agents may have less experience than a broker, though both are licensed and vetted to perform the duties of overseeing your policy. Either way, once you buy your policy, if you need to file a claim, your agent or broker will send you to the claims department.
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Advantages of a Broker
For an individual who runs their own business, a broker may be more ideal because they can act as a custodian for all the insurance products. Some brokers cater to the self-employed and work to find health, disability and even homeowners insurance.
A broker would probably alert you that if you have your own at-home business that you need separate business insurance in addition to a homeowners policy. That is where these professionals prove their worth.
An agent might be excluded from such a conversation, whereas a broker might already be looking into life insurance policies for you and therefore know what you do for a living.
Other customers prefer having a go-to person for every insurance policy that they buy. They prefer building rapport on their own and forge their own relationship with their individual insurance agents. That's why when buying homeowners insurance, many consumers turn to a house insurance agency.
Both brokers and agents may find you multi-line discounts, for buying more than one insurance product from the same insurance carrier.
While you might see the insurance agent or broker as a fountain of knowledge, they are professionally limited to basically defining coverage terms. They cannot tell you what to buy.
It's vital you learn about homeowners coverage first, before shopping or comparing quotes. Another tip be sure the insurance carriers have an excellent credit rating because that's your assurance they have the money to back any claims you file.
House Insurance
House insurance, also called homeowners insurance, is a product specifically intended to protect your house. Additional coverage on typical homeowners policies include personal property and liability insurance.
Where homeowners insurance confuses consumers is in the details. Consumers often wonder what is covered and excluded from their insurance policy. There is fortunately a list called included perils within the proposed and actual homeowners insurance policy.
Be sure to do what many others forgo: just read it. You might be surprised to find what your coverage includes.
Buying the Right Coverage
The other big challenge is figuring out how much coverage to buy on the structure itself.
Basically, the main idea of homeowners insurance is to have sufficient insurance rebuild your house if it is destroyed. The rest of coverage is a gray area, where you have to decide what risks you can and cannot tolerate. It's a lot of personal decisions beyond the house.
Hire a home appraiser and contractor to estimate how much it costs to rebuild your house in today's dollars. That's the basis for how much coverage you buy on the structure. Ignore anything about mortgages, taxes or real estate values.
What type of replacement makes sense?
- Are you a homeowner who prizes your personal possessions that adorn your home as much as you do your house?
- Would you want to buy all of your belongings over again because they were ruined in a house fire?
- Can you afford to set aside the money you are not spending to insure your belongings?
- Can you afford to go out right now and buy all of your prized and necessary belongings?
Most homeowners, including you, would probably agree there is not enough money and no in paying for your belongings a second time around. So, even if you are not in love with your old couch, you probably want the financial help of insurance to remunerate you if your belongings are destroyed.
That is why there is insurance for your possessions, or contents of your home.
There are two types of coverage exist for possessions. It is actual value and replacement cost. Actual value will pay you for today's value of your belongings. Following a tornado, which embedded your pictures frames in your television, how much is your television now worth? Maybe nothing.
That's why it's important you buy what is called replacement value on your personal possessions. Otherwise, there's little value in paying to protect your belongings. Replacement value means simply that you are paid in today's dollars how much it would cost to buy your television new.
This brings up another aspect of insurance coverage that is key. It is called inflation guard. It means that even if you just automatically renew your policy every year without reviewing it, your coverage limits will increase, adjusting upward for inflation.
Review Your Policy Annually
Always look at your coverage annually. Maybe your 30-year old got married and moved out all of his belongings, from his first tricycle and pre-school artwork right up to his furniture, along with his fiancee and her items.
You were so excited you have your free rooms back that you forgot to update your policy. If you are just starting a family, built a new deck and added a pool, then it's definitely time to update the policy.
Special Policy Considerations
To insure a house with a pool, make sure you find out your insurance company's stipulations. Local laws factor into the equation as well. Your state may require a fence of a specific height enclose the pool. You might also have to carry special coverage just for the pool.
Beyond just adjusting coverage downward to exclude your kids' belongings now that he's moved out, read your policy. Does it beg any questions? If you live in a region that's affected by hurricanes, you need to know that the policy needs to include hurricane wind damage specifically.
Regular wind damage will not cover the super charged damages of hurricanes.
In addition, there is a good likelihood that you might need that falling object inclusion on your policy. Trees get water logged and sometimes fall onto homes. Ensure your policy still covers against falling objects. It's listed under perils.
Additionally, most policies cover against liability. For instance, if you have frequent pool parties, and one of your friends slips and breaks their foot, you might be financially responsible.
At the least, you might feel bad and want to help offset some of the medical costs of their condition. That's where liability insurance comes into play. It also protects the value of your home, which someone might be eyeing if they decide to sue you for their injuries.
Understanding Endorsements
Some types of insurance coverage are not included in a policy. For instance, flood insurance and earthquake insurance are the first two that come to mind. The latter is purchased through adding on endorsements to your regular homeowners insurance coverage.
If you were wondering, earthquakes occur in approximately 90 percent of locations around the United States. Though, Californians receive the brunt of damaging earthquakes. While Alaska has the largest earthquakes, it is in mostly un-populated areas.
Flood insurance is one product that requires your home to be precisely located within a federally-identified flood plain. For more information, check out floodsmart.gov. For further information, check out whether you are included in the flood plain or not.
Customer Satisfaction Matters
Imagine the tension, anxiety and duress you might be under if you have to file a homeowners insurance claim. When under emotional stress, it's harder to think straight and to accomplish simple tasks.
That's why it is important to have an insurance company who anticipates needs and makes the claims process a little friendlier. Customer service and claims department are people you will interact with when possibly very upset. So, it's important that they are highly effective, courteous and efficient.
Look to this article to find out more about how insurance companies perform.
Buying insurance is partly about finding the right insurance agency as much as the right policy for your home. Take the time to read your policy before signing up for coverage. Make sure you have protection for special cases, such as earthquakes, flooding and pool ownership.
Ensure you are protected against liabilities and that you have a replacement policy in effect for your belongings as well.
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