HOMEOWNERS INSURANCE

PROPERTY INSURANCE Property Insurance- Insurance that protects you from loss of real and personal property Real property- Property attached to land such as a house, business, garage or another building Personal property- Includes possessions that can be moved like furniture, jewelry and electronic equipment.

T YPES OF PROPERTY INSURANCE Renters Insurance- The owner of a building such as an apartment will have property insurance. The renter should purchase renters insurance which covers personal property in the apartment such as TV's appliances and furniture. It can also include liability protection in case someone is injured in your apartment. Standard fire policy- Fire accounts for 85% of all property damages. Many people buy a standard fire policy to insure against fire damage.

TYPES OF PROPERTY INSURNACE Extended coverage- protects against damage from windstorms, aircraft crashes, hail, falling objects and explosions and vandalism. Liability Protection- protects you from the costs of injuries to others on your property. It pays for medical expenses and legal costs. Additional Living Expenses- It pays for the cost of renting another place to live if your home is damages. The coverage is limited to 10-20% of the coverage on your home. The time can be limited from 6-12 months.

TYPES OF PROPERTY INSURANCE Business Insurance- Business owners can get insurance to cover the costs of the property and liability insurance to protect themselves from claims by anyone injured on the premises.

HOMEOWNERS POLICY Homeowners Policy- provides protection against loss from the eleven perils. Eleven Perils- The most common causes of property damage or loss. They include fire or lightning, loss of property from fire, windstorm or hail, explosion, riots, aircraft, vehicles, smoke, vandalism, theft and breakage of glass. All homeowners policies cover the eleven perils.

H OMEOWNER S POLICY The six types of Homeowners policies are: 1. HO-1 Basic form is the least expensive policy. This policy protects a home and personal property against the eleven perils. It also covers liability insurance, damage to personal property and temporary living expenses. 2. HO-2 –the most popular policy or Broad coverage adds 7 additional types of coverage including, ice or snow damage, internal pipe damage causing water damage, electrical fires and falling objects. 3. HO-3-provides maximum protection for the house itself, with less coverage for personal property.

H OMEOWNER S P OLICY 4. HO-4- is the policy for renters covering personal property. 5. HO-5- the all risk policy provides the most comprehensive coverage. It insures a building and its contents with maximum coverage. It is the most expensive policy. 6. HO-6- is a policy for condominium owners. It covers personal property and anything else inside the unit.

H OMEOWNER S POLICY Special coverage's -Most homeowners policies cover special items such as jewelry for limited amounts. You can buy additional insurance for special items such as coin collections, or other valuables such as antiques. Rider -An addition to the policy that covers specific property or damages. Riders are often used for jewelry, art or antiques. NONE of the homeowners policies cover loss from floods, earthquakes, landslides, war or nuclear hazards. If you live in a flood zone, you must purchase flood insurance (if you have a mortgage)

A MOUNT OF INSURANCE Insurance companies recommend that you insure your home for 80% of its market value since fires do not destroy the land or foundation. As the value of your property increases you should also increase the amount of your insurance. You can insure property for either its actual cash value or its replacement cost. The replacement value is the full cost of repairing or replacing the property today, regardless of the depreciated value.

C OST OF INSURANCE Property insurance has many of the same costs vehicle insurance does. The number of claims affects the overall cost. The premium depends on the amount of coverage and the type of policy you want. Factors that affect price include: 1. Deductible-amount of money you pay out of your pocket before insurance coverage begins. The higher the deductible the lower the premium. 2. Location-Urban areas usually cost more. Access to fire hydrants also can affect cost. 3. Type of building-A house made of brick will cost less than a house constructed of wood. The larger the house the higher the premium 4. Preventative measures-burglar alarms or smoke detectors, deadbolts and sprinkler systems.

H OMEOWNERS QUIZ 1. I have a really good homeowners policy, so I am covered in case of a flood? 2. My landlords insurance covers me, so I dont need to buy my own policy? 3. The market value of my home is down, so I should reduce the insurance coverage of my house to match it?

H OMEOWNERS QUIZ 4. The damage caused by a tree or a heavy tree limb crashing onto a house is always covered? 5. Does flood insurance cover damage to food in the refrigerator or freezer? 6. Should you keep a copy of your homeowners policy and inventory of personal property in a safe place in your home? 7. During a power outage can you move to a hotel until the power comes back on?