Home Owner Insurance FAQ's

How do I determine how much to insure my home for ?
How do I pay for the insurance ?
What if I have a loss ?
If I have a claim will my premiums go up ?
How can I lower my insurance premiums ?
How should I decide on a deductible ?
When will I receive my policy ?
Do I need to purchase flood coverage ?
What if I want to change my coverages ?
What if I have questions about my policy ?


How do I determine how much to insure my home for?

You should insure your home for what it would cost to replace it in the event of a total loss. There are several ways to determine that value. If you are purchasing a new home, a good rule of thumb would be the purchase price less the value of the lot. Another tool is an appraisal of the property. Most lenders require an appraisal as part of the loan process. Finally, there are several computer programs designed to estimate the replacement cost of homes.


How do I pay for the insurance?

If you are purchasing a new home, the first year's premium will be paid at closing. This is part of your closing cost. After that, most homeowners elect to have their mortgage company handle the insurance payments. The mortgage company will add the cost of insurance to your monthly payment. That money will be held in an escrow account and when the next year's premium is due, they will pay the insurance company. Other payment options would need to be approved by your lender and arranged with the insurance company.


What if I have a loss?

Your insurance policy requires that you do what is necessary to prevent further damage to your property in the event of a loss. You must also promptly notify the company. You can contact the office where you purchased the policy or the claims number printed in your policy packet.


If I have a claim will my premiums go up?

Generally, 1 claim will not increase your premium, however more than 1 claim in a 3 year period could cause your premium to increase


How can I lower my insurance premiums?

Most insurers offer a variety of discounts. Some of these include discounts for a new home, discounts for alarm systems and discounts for having more than one policy with the same insurer. You should contact your insurance company to find out what discounts are available and if you qualify.


How should I decide on a deductible?

The lower your deductible, the higher your premium will be. When deciding on a deductible, you should determine what is most affordable for you. In the event of a loss, you will be responsible for paying the deductible. You should choose the highest deductible that you feel you could pay without causing a financial hardship.


When will I receive my policy?

When your loan is closed the title company will send a check for your insurance to the insurance company. The company will issue the policy and mail a copy to you and a copy to the mortgage company. This process usually takes 4-6 weeks. Each year when your policy renews, you should receive a new policy about 30-60 days before the renewal date. Be sure to check your policy to make sure the coverages, limits, deductibles and endorsements are what you requested. Also verify the premium is what you were quoted.


Do I need to purchase flood coverage?

If your home is located in a designated flood zone, your mortgage company will require a flood policy prior to closing. Your builder should also advise you that you are purchasing a home in a designated flood zone. Some areas may be more likely to flood even if they are not in a designated flood zone. Your decision to purchase flood insurance should be based on the probability that you could suffer a flood loss, the extent of damages you may suffer and the cost of the insurance for your home.


What if I want to change my coverages?

If you need to make changes in you policy, you should contact the office where you purchased the policy or the customer service number located in policy packet.


What if I have questions about my policy?

You should contact the office that sold you your policy or you can contact the company at the customer service number found in your policy packet.