Insurance Maze Blog

It is important to understand that all insurance descriptions, terms and definitions presented anywhere in this blog are stated in general terms and are for informational purposes only. The insurance laws of your state will apply and so will the terms and conditions of your individual insurance policy.

Some Of The Things Used To Determine Home Insurance Premiums

Replacement Value Of The Home
Some people get confused about the terms “market value” and “replacement value”. Insurance companies aren’t really concerned about what you paid for your home, but are concerned about the amount of money it would take to rebuild it if it was totally destroyed. Most insurance companies use some type of Replacement Cost Estimator to determine the appropriate dollar amount of insurance to place on your home.

The Location Of Your Home
Normally if your home is within 5 miles or less of a responding fire department, your insurance rate would be lower than if your home were out in the country where it would take a fire department some time to respond to a fire. Also, the location of the nearest fire hydrant may affect your home insurance premium.

Protective Devices
The largest insurance discounts for protective devices will most likely apply to central station fire and burglar alarms, where they are actually monitored. Some insurance companies offer smaller discounts for local alarms, fire extinguishers and dead bolt locks.

Swimming Pools and Trampolines
Many insurance companies will not even offer home insurance for a home with a trampoline. Others may insure the home but may require a “Trampoline Exclusion” to be signed, whereby they waive all liability for any claims resulting from the trampoline. Homes with swimming pools can be insured, but many insurance companies require a four to five feet fence with a locking gate around the pool.

Pets and Exotic Animals
Dog bites have been a major liability claim expense for insurance companies. Some insurance companies will not insure a home where there are pets which are known to have a vicious nature, i.e. Pit Bulls, Rottweilers, etc. Other companies may insure the home with an “Animal Exclusion” endorsement.

Other Things Which Influence Home Insurance Premiums

• Credit History
• Previous Home Insurance
• Previous Home Insurance Claims
• Insurance Deductibles
• Added Endorsements

So, by considering some of the things that affect home insurance premiums, you may see ways to lower the premiums on your current home insurance policy or you may see some things you might want to look for if you are currently shopping for a new home.

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Insurance Maze Articles of Interest

• Do You Have The Insurance Coverage You Think You Have?
• Is Your Commercial Vehicle Insured On Your Personal Auto Policy?
• Medicare Supplement Insurance & Medicare
• Home Insurance/Home Inventory-A Good Combination

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