A homeowner with a family and place of residence to protect may opt to get a home insurance policy. But with the many insurance companies and plans available, it can often be a confusing thing to do. Having a family and home to protect can often lead some to dive into home insurance policies which are expensive but oftentimes not comprehensive enough to cover damage and all family members, making the investment effectively useless in a real-world situation.
However, once you know what to look for, picking a complete and comprehensive home insurance policy will not become that tedious of a chore. Knowing what you want out of a prospective policy, such as flood and earthquake coverage, as well as other home accidents such as fires will set you on the fast track to getting the coverage and compensation you need to protect your family and other investments in your home or place of residence.
From HO-1 to HO-8
Many home insurance policy providers follow a standardized ranking system to providing insurance to prospective homeowners. This is the HO-1 to HO-8 system, which ranks homeowners into certain insurance policies depending on factors such as disaster-prone zones, the age of the home, crime rates in a given area, among other things.
HO-1 is also known as Basic Home Owners Insurance and covers your home and personal property contained within against damages or losses including theft, vandalism, fires, earthquakes, and other natural disasters.
HO-2 more commonly known as Basic Homeowners Insurance Plus. This is similar to HO-1 but includes other kinds of damages such as falling objects, electrical surges, and flood or snow damages done to utilities or appliances.
HO-3, or Extended or Special Homeowners Insurance, provides even more extensive coverage than HO-2 for your home spanning from the structure to the content inside your house. This can also be referred to as an All Risk Policy.
Renter Insurance is categorized as HO-4 and covers the personal property from the elements included in HO-2 plans. This caters to people renting a living space, hence the given term Renter’s Policy.
HO-5 is also known as an All-Risk policy and covers the structure itself as well as the personal property contained within, much like HO-3. HO-5 policies, however, cover a larger area from damages or losses as well as accidents caused by passers-by or outsiders.
HO-6 can be referred to as Condominium Owners Insurance Coverage. This policy is for condominium owners and their personal property and often provides protection for mishaps and disasters that happen within a condominium such as fires, theft, and other forms of loss and some natural disasters.
HO-7 can be considered a hybrid home insurance policy that covers both the building and the contents on the basis of risk by direct physical loss.
HO-8 can be referred to as Basic Older Home Coverage and can be applied to homes that have historical value or significance. This home insurance policy can also include repair and restoration to an older house in addition to theft, vandalism, and loss coverage.
Picking a Good Home Insurance Company
The sheer variety of insurers available to a homeowner can often make the task of picking a good home insurance policy very daunting at first, but it should not put you off from weighing in the available options in order to get a good deal. Free databases available both online or at your local realtor may be good to check first, in order to get a good feel of what companies have to offer to potential customers.
When you have a shortlist of insurers you think are reputable enough to serve you, request quotes from them to help gauge and compare costs between insurers. Getting quotes from carriers should have little to no cost involved, and should include everything including additional and hidden fees unless you are planning on paying for more later on down the road.
Picking a company that deals directly with customers can often be a good sign for an insurer. Dealing face to face without the middleman can often lead to big savings, unlike insurers that advertise through junk mail and spam messages through your email. However, that is not to say that these by mail insurers do not offer good deals as well, so be sure to read through the fine print should you consider to weigh this in as an option too.
Your nearest state office should offer shopping guides to insurers and home insurance policies for homeowners. Knowing that a governing body offers a list of reputable insurers and home insurance policies can help bring peace of mind to a homeowner and may include smaller, lesser-known companies with comparatively lower rates than bigger insurance companies.
When picking any company to provide you with a home insurance policy, pick out a company with good financial ratings, as many companies take a dip in financials during major natural disasters. Inquire from a company about this information, or check out their financials on online or local realtor listings to gauge an insurer’s ability to cover you and your home.
If you are in an area that constantly gets hit by natural disasters such as floods and earthquakes, you may only be stuck with only one state-sponsored home insurance policy as part of a high-risk pool of homeowners. If this is the case, try waiting for a little more if you think it is worth the risk, as there are many insurance companies both big and small who are also willing to break into the high-risk market.
This Blog was brought to you by Falcon Insurance Services in San Antonio and South Texas