Home insurance is a product designed to cover potential losses that may suffer property: theft, damage, electrical shorts, broken pipes, domestic accidents, etc… Then you have all the information about home insurance: how much they cost and what they should cover.
The mission of home insurance is to protect homeowners and cover the costs of these mishaps … in exchange, of course, an amount that does not go beyond 300 per year.
Am I required to have home insurance?
In US, the multi-risk home insurance is not mandatory. The only compulsory insurance when purchasing a home is fire insurance.
What should homeowners insurance cover?
In general, any basic home insurance offers:
- Damage the continent (housing itself) : Ceilings , floors , buildings, windows … Taking home insurance , the insurance will pay for repairs for damage caused by fire, theft , water, etc. . Before signing, you need to ask what accidents or incidents include and what not, because every company is different.
- Damage of the content (what is at home): covers the repair or replacement of furniture and household goods. You want to be covered by the value “reset”, i.e., so these items would cost if we had to buy them again. However, it is common for companies to secure them for the actual value, less depreciation suffered by use.
- Liability: covers repairs and compensation that the insured has to pay others for the damages caused to them (for example, if you leave the gas Turning the power on and causes a fire). In the event of injury, such compensation can be substantial, so it is advisable to take out home insurance with liability coverage of at least 300,000 dollars.
- Legal Defense: covering legal costs in case others have caused damage to our property. Includes, as owner or tenant rights, etc.
- Criminal defense. You need to ask the company and be clear about how long we will be covered not lead to surprises.
How much?
The average value of the home insurance goes between 250 and 300 per year for an average home of 120 square meters. Smaller homes typically cost less and more single-family homes, to ensure the same value as a floor.
Many companies charge what they call “proportional rule “. Compensation means are proportional to the premiums paid. So when taking out a comprehensive insurance policy home, it is essential to assign the correct value and contents.
The consumer organization OCU and advises users to choose an insurer that connection to allow a margin of difference in the valuation of at least 15 % before applying the proportional rule. In the end, depend on the customer to choose the coverage. For example, if our furniture is not very valuable and we do not have jewelry or artwork, maybe not worth the insurance covers the continent and can save that part.
How to pay?
If it is safe to have acquired its own accord, the company will allow us to pay monthly, quarterly or annually.
If it is relevant insurance required by the bank that grants us the mortgage, the entity we could propose a PUF (single premium financed), i.e. the price of the insurance is added to the mortgage debt and pay diluted in monthly installments. The good: you pay a very small portion each month. The bad: The bank is also charging us fees on the price of insurance for the entire life of the mortgage.
In any case, we must be clear that it is not necessary to hire multi-risk home insurance in the bank. Serve any insurance company so we can compare prices and coverage before choosing.