by John Savage CFHC, Insurance Broker
Many people who have Home Owners Insurance may think everything in their home is covered and that all they have to do is filing a claim. Better yet, many people think they are getting a good deal because their Home Owners Insurance is really cheap. Unfortunately, that ma be true in more ways than one. When looking for Homeowners Insurance, it is best that Home Owners take their time in choosing the right company that fits their needs, not just in price but also in terms of service.
What typically happens is if a person does not choose their own Home Owners Insurance, a lender will choose it for them. Unfortunately, their interest is not your interest. Having some choose coverage for you just to meet minimum qualification in order to get to finish "packaging" a loan is not the way to go. Prime example, with my experience providing Financial Coaching to EAP members across the country, I have spoken with many people who some cases actually had no Home Owners Insurance coverage at all because that they could do with out it temporary due to Financial Hardships and when their house caught fire, they lost everything and how to take what saving they had left and on the verge of facing homelessness. While others, were told they did not need flood insurance in high risk or potential high risk areas only to be overcome by the ripple effects of hurricanes along the Gulf Coast and being to force to relocate temporarily and paying out of pocket to not only find a place but trying to figure who was going to help them cover the cost of repairs for water damage because they did not have Flood Insurance to compliment Home Owners Insurance coverage.
So, having Home Owners Insurance is not enough but having the right amount and proper coverage for your specific need is what is important along with a company that has excellent customer service, a responsive claims department, and an agent who has your best interest at heart.
In addition to these examples, it is important to note that while having the proper amount comprehensive coverage may be adequate, it may not be the only thing you need. Because Home Owners Insurance is designed to cover the structure itself and contents and belongings. It also provides basic protection against liability claims for dog bites or other personal injury, which includes WC, Jewelry, items that would normally be in your home, damage directly from Hail, Wind, Lightening Strikes and Volcano's. Another type of protection against risk is Home Warranties. This one seems unnecessary but it is beyond just a basic product warrant that does not carry over to the new owner and provides specific and limited coverage.
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This is one of the most common areas where some thinks their Home Insurance Claim will be covered only to find out their will have to pay out of pocket because their policy did not cover appliances such as microwave, refrigerators, washer and dryer, garbage disposal, or systems such as electrical wiring, water line breaks, gas pipes, or some other system with their home. Home Warranties can seem like an added expenses but paying an extra $600 to $1200 a year can be well worth it instead of dealing with the adverse of having to pay $10k out of pocket for an HVAC System that is not working or fixing water damage and paying to replace a failed hot water heater. In simple terms, unless coverage is provided, a Comprehensive Home Warranty plan is essential to peace of mind. Not to mention your home being in compliance with the laws of your city or state.
So, when I speak to families now during my Financial Consultations and I potential risk factors that just around the corner, I bring it up in conversation to in an attempt to stress the importance of why these things are important and what they condo to minimize or eliminate certain risk factors. Look at it this way, you have worked hard to get to the point of Home Ownership and spending an extra $500 to $1000 if necessary should be looked at as an investment that could very well be worth $10's to $100's of thousands of dollars tomorrow.
An example of some great companies that are know for great customer service and a friendly and seamless claims process are Liberty Mutual, Hippo Insurance which is a new InsureTech Company, USAA, American Home Shield, American Warranty, American Residential Warranty and Progressive just to name few. to get a quote now, click here, Quote Me Now!