When buying homeowners insurance reading the fine print of your contract is a necessity. Unlike auto insurance, an HOI policy is much more
specific and there are no one size fits all. Take a natural disaster
such as an earthquake. If you live in a state where they are extremely
common, the odds of your house being covered in a basic package are
extremely small. Why? This risk creates a bigger liability for the
company. Property that presents a high risk will require supplemental
additions to the main policy. While the prices will be high, the
protection is generally worth it.
As previously mentioned, natural disasters represent one of the greatest
risks to property. Additionally, this is where homeowners insurance
companies take their biggest hits. Before buying a new house, it is
important to research the area and potential threats that may exist. You
can’t just trust the realtor either. Unless you are already familiar
with the location, take the time to speak with neighbors, check old
newspapers, and learn something about the history. The topography will
also determine how much of a risk is present. Landslides will threaten a
house that is located on a steep hill near rocks, even if the area has
no recent history of such an event. If you do discover the house is a
high risk, inquire about the cost of covering the needed protection and
what supplemental will run you. Sometimes the price isn’t worth
investing in the house.
It isn’t only the location of your house that can make it high risk.
Homeowners insurance can skyrocket if you have a pool, spa, lake, or
other similar amenities located on the premises the reason being that an
accidental drowning or injury by a guest or someone included in the
policy can mean a huge loss for the company. Additionally, extremely
dangerous features such as large trampolines may be excluded regardless.
Few companies will cover this type of hazard and some will drop you as a
client if it is discovered that you have purchased one. You may also
breach your existing contract if one is found on the property, even if
you’re requesting compensation for something that is covered.
If you’re a collector, you know how important it is to keep those toys
in the original packaging or ensure your first edition books are well
covered from sticky fingerprints. But while you may know the worth of
your collection, your homeowners insurance company probably doesn’t care
and won’t cover your collection of fine art or stamps. Most policies
cover a small amount for stolen items or those damaged in an accident,
but it will likely be a fraction of their true value. Separate insurance
for collectibles or requesting supplemental on your HOI is important to
ensure you don’t lose your lifetime’s work. You will have to prove
their value, so you will have to invest in appraisals and may have to
update them every few years in case it rises or drops.
Homeowners Insurance, High Risk
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ABOUT THE AUTHOR
In Charlotte homeowners
insurance is available and affordable. Get coverage for your
personal items and visit: http://www.patriotagencies.com/
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