“Homeowner insurance” (like “Automobile insurance”) is NOT a single coverage. Rather, it is normally a collection of individual coverages. Think of buying insurance for your home like going to the grocery store. You push your cart down the aisle … and you buy meat (liability coverage), milk (medical payments coverage), and bread (fire coverage). The key is buying what you need for your home.
Insurance Agents
The person selling insurance is an “agent” – you pay an agent to sell the right set of coverages. Your insurance agent should actually talk to you – interview you – asking questions about your home, risk aversion, and particular economic issues – before recommending these coverages. If your agent fails to ask you questions, find another agent. You are paying this agent for a valuable service. Make sure you get that service.
How Much Insurance?
My advise is to buy AS MUCH INSURANCE (OF EACH COVERAGE) AS THEY WILL SELL YOU. Normally, this means you spend a few hundred dollars extra each year. Trust me, if disaster strikes, you will be glad you spend the few hundred extra dollars.
When speaking with your insurance agent, be honest. Hold nothing back. Talk about your financial situation, health, hobbies, expected changes, etc. For example, I’m a Ham Radio operator: KL7IXW. I have a 70′ radio tower in my yard. I made very sure to disclose this fact to my Homeowner insurance agent. Towers have a way of eventually falling down – and possibly hurting someone. I want to be sure that risk was covered. I am protecting that person and my family.
Compare Policies
The best way to compare homeowners insurance is to get price quotes from multiple companies. Shop around for a better quote. Insurance is a commodity and generally uniform (with some exceptions) from one insurer to the next. Contrary to most TV commercials, there is little difference between Homeowner insurance policies issued by State Farm, Allstate, Country, USAA, Hartford, American, etc. It is good to get an “insurance quote” from one agent (at say, State Farm) and then walking that quote over to another insurer (at say, Allstate) and ask: “Can you beat this State Farm Homeowner quote?” Ask questions such as “What are the differences between the State Farm Homeowner coverages and those offered by Allstate?”. Make an educated decision.
The Merdes Law Firm has been helping injured Alaskans for more than 30 years. It’s who we are. And while we hope you never need us … We’re here if you do. ~ Ward Merdes
This is part two of a four part series. See parts one, three and four.
Source: Ward Merdes
Image Source: Sammamish Mortgage
