Com-Co 
How much insurance should I purchase on my home?
This is sometimes a very difficult question to answer. The first thing to remember is that you are only insuring the physical structures. You are not insuring the land. If you are a first time homeowner and purchase a home for $500,000, you do not necessarily need to buy $500,000 of coverage for the home. Determining the cost to rebuild your home and other structures (i.e. garage) is something that should be discussed with a Com-Co agent. We can provide you with an estimate of the replacement cost of your home. There are several factors that will determine the homes cost to rebuild:
- Location; the city and county location.
- Square footage.
- Roof type.
- Design of home, custom vs. tract home.
- Foundations, the shape and soil conditions.
- Number of floors.
- Number of rooms.
- Number of chimneys.
- Number of bathrooms.
- How many cars the garage will hold. etc.
It is important to properly insure your home so that there is adequate insurance at the time of a loss. A typical homeowners policy provides replacement cost coverage -- provided you carry enough insurance to cover your home in the event of a total loss. If you agree to insure your home to the estimated replacement value established by the insurance company, many companies will provide you with a buffer of 25% to 50% over and above your stated policy limit to give added protection in the event of a catastrophe.
What is the difference between "actual cash value" and "replacement cost"? Covered losses under a homeowners policy can be paid on either an actual cash value basis or on a replacement cost basis.
- When "actual cash value" is used the policy owner is entitled to the depreciated value of the damaged property.
- Under the "replacement cost" coverage, the policy owner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.
What are the policy limits (i.e., coverage limits) in the standard HO-3 homeowners policy?
Coverages A and B provide protection to the dwelling and other structures on the premises up to the policy limits.
The policy limit for Coverage A (Building) is set by the policy owner at the time the insurance is purchased. This is the maximum amount the insurance company will pay to have your home or dwelling rebuilt in the event of a covered cause of loss.
The policy limit for Coverage B (Other Structures) is usually equal to 10% of the policy limit on Coverage A.
Coverage C (Personal Property) covers losses to your personal property. The policy limit on Coverage C is usually automatically set at 70% of the policy limit on Coverage A.
Coverage D (Loss of Use) covers the additional expenses that you may incur when your home cannot be used because of a covered loss. The policy limit is equal to 20% of the policy limit on Coverage A. This covers extra costs to rent a hotel room, set up utilities etc.
The coverage limit on Coverage E (Personal Liability) is determined by you at the time the policy is issued. Liability options are usually $100,000, $300,000, $500,000 and $1,000,000.
The coverage limit on Coverage F (Medical Payments to Others) is usually set at $1000 per injured person.
Where and when is my personal property covered?
Coverage C applies to your personal property (except property that is specifically excluded) anywhere in the world. For example, suppose that while traveling, you purchased a dresser and you want to ship it home. Your homeowners policy would provide coverage while the dresser is in transit - even though the dresser has never been in your home before. Coverage for property off premises is typically limited to 10% of Coverage C.
Is my jewelry, fine art, guns, computer or silverware covered?
Most policies provide very limited coverage for these items. To provide the best coverage for these items, they should be scheduled on your homeowners policy. There is an additional charge for scheduling these items. When you do schedule an item the deductible is typically eliminated. To schedule an item a current appraisal or sale invoice may be required.
For example, if you notice one day that the diamond on your ring is chipped or lost, the loss will be fully covered without deductible. Coverage is limited to the value stated on the policy.
Am I covered if a sewer or drain back up and flood my house?
Sewer & Drain backup are usually excluded from your policy. Most insurers will add this coverage to your policy for an additional premium.
In the event of a claim to common areas in your condominium or homeowners association, the association may assess each unit owner with a portion of the monetary damages or deductible. Loss assessment pays for the damages if the damage is caused be a covered cause of loss. For example, if your association's insurance policy carries a large deductible. The cost to repair the fence is $15,000, below the Association's policy deductible. The association is comprised of 5 units. Each unit owner would be assessed $3,000 to cover the repairs.
What factors should I consider when purchasing homeowners insurance?
There are a number of factors you should consider when purchasing any product or service, and insurance is no different. Here is a checklist of things you should consider when you purchase homeowners insurance.
- First and foremost, purchase the amount and type of insurance that you need. Remember that if your policy limit is less than 80% of the replacement cost of your home, any loss payment from your insurance company will be subject to a deduction for depreciation. Also, determine the amount of personal property insurance and personal liability coverage that you need.
- Second, determine which, if any, additional endorsements you want to add to your policy. For example, do you want the personal property replacement cost endorsement or back up of sewer endorsement?
- Finally, once you have decided on the coverage you want in your homeowners insurance policy consult with a Com-Co agent to find the company that offers you the best coverage at the best price. Also check to see if one company can insure your car and home and offer you discounts on both.
A named perils policy covers losses that are caused by only those perils listed in the policy. The perils typically covered include fire, windstorm, hail, and other direct physical losses. A special form policy covers losses that are caused by any peril except those specifically excluded in the policy. It is important to note that a special form policy provides broader protection than do named perils policies. Both policies also exclude earthquake and flood insurance. What can I do to lower the cost of my homeowners insurance?
There are a number of things you can do to lower the cost of your homeowners insurance. The best thing to do is have your Com-Co agent compare the rates of several insurance companies for you. It is not surprising to find quotes on homeowners insurance that vary by hundreds of dollars for the same coverage on the same home.
Another way to lower the cost of your homeowners insurance is to look for any discounts that you may qualify for.
- Many insurers will offer a discount when you place both your automobile and homeowners insurance with the them.
- Insurers offer discounts if there are deadbolt exterior locks on all your doors, or if your home has a security system.
- Newer Home discounts. Some insurers offer discounts on homes that were recently built.
- Renewal Discounts. Some insurers will lower your premium if you renew with them.
- Another easy way to lower the cost of your homeowners insurance is to raise your deductible. Increasing your deductible from $500 to $1,000 will lower your premium, sometimes by as much as five or ten percent. However, be careful to make sure that you have the financial resources necessary to handle the larger deductible.
An Insurance policy is a conditional contract, which means that a policyholder has certain duties to perform if a covered loss occurs. Failure to perform can result in a claim denial by the insurance company for a loss that otherwise would have been covered.
Required duties include:
- notifying the insurance company or the agent that a loss has occurred -- this should be done as soon as you discover the loss;
- protecting the property from further damage and/or to making any repairs necessary to prevent further damage;
- preparing a detailed list of the personal items damaged containing a description of the items, their actual cash value, or their replacement cost if you have added the replacement cost endorsement to your policy;
- being prepared to show the company and/or the insurance agent the damaged items;
- completing a statement for the insurance company that details the events that led to loss -- for example, the time the damage occurred, the cause of the losses, etc.
Building Ordinance is very important coverage for older buildings. In the event of a claim, the insurance company may deny paying for increased costs or demolition expense incurred due to local building ordinances that may call for the destruction of an entire home or dwelling. If you own an older home find out from your Com-Co agent if you can get this coverage added to your policy I am renting a home do I need extra liability insurance?
In additional to standard personal liability insurance, you should add Personal Injury coverage to protect you from wrongful eviction of a tenant. This can sometimes be extended from your homeowners or be included on the property policy for your rented dwelling.
I am running a business out of my home am I covered?
Most homeowners and dwelling policies exclude any business activities conducted from the home including day care. They may also exclude any business property. "Business In Home" endorsements are available from many Homeowners insurers, depending upon the type of business.
Do I need Flood Insurance?
My home will be vacant am I covered?Standard homeowners and dwelling policies contain vacancy clauses that limit, reduce, or cancel coverage if a dwelling is left vacant for than a specified number of days. Check with your Com-Co agent to see if you are covered or not. My dog bit someone am I covered?
Most policies cover dog bites. However with the increasing number of claims occurring from dog bites several companies are excluding dog bite coverage or offering lower limits of liability for dog related claims. Check with your Com-Co agent if you have any pets to ascertain coverage.