General Homeowners Questions:
Mortgage Insurance
Rental Properties:
Flood and Earthquake:
General Homeowners Questions:
I have heard I should buy "replacement-cost coverage" for my house why?
While this homeowners coverage is more expensive - approximately 10 to 15 percent more than a conventional "actual cash value" policy, it has the advantage of paying to replace an item with one of similar quality, even if it the lost items have depreciated since you bought them.
Actual cash-value policies pay out only the value after it has depreciated. So if you have older televisions, furniture and personal effects you will not receive the cost of replacing them with new items.
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My children are in college are they covered on my policy?
Your homeowner's policy covers children staying in campus dormitories, but not if they rent
an apartment. The IIAA estimates that 80 percent of college attendees don't have insurance to cover property kept
at school.
If the children are dependents, they should still be covered at 10 percent of the parents'
property insurance, just as with coverage that normally applies for possessions away from
home. But that may not be enough to protect computers and printers etc. If your child is
renting you should consider renter's insurance.
Also note, that if your child studies overseas you should review your family's health-care
coverage too. Click here for more information.
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I have some jewelry and art that has increased in value
over the years what should I do?
A standard homeowner's policy cover the contents of a home up to half the value of the house,
as well as home liability. But most policies have limits on the amount they'll pay out for different categories
of personal effects, $1,000 or $2,000 on jewelry, for instance, or $2,000 on firearms. You should consider
"scheduling" your valuable articles, as a rider to your homeowners insurance, this is usually less expensive
than buying a separate policy. Also be sure to keep your valuations current.
Send us a secure email requesting a quote for valuable jewelry and art and we can typically bind coverage the same day.
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Should I advise my agent every time I make a home improvement?
Not for minor improvements, but you need to make sure that your home is always insured for at
least 80 percent of its replacement cost or you will be subject to a co-insurance penalty in the event of a claim.
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Do I need additional insurance if my condo association has a master policy?
Because you don't own the entire building, insuring a condominium is different than insuring a home. In addition to the master policy, there is a special homeowners insurance form designed specifically for condo owners, which is called an HO-6 form.
HO-6 policies protect your personal property from losses caused by perils named in the policy, such as fire, lightning, storm, explosion, riot, aircraft, smoke, vandalism, theft, broken glass, and volcanic eruption. HO-6 typically covers improvements, additions, private balconies, private entranceways, private garages, and other property that is your insurance responsibility under your condo association's guidelines. HO-6 policies also provide liability coverage similar to a standard homeowners policy.
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In a power outage is spoiled food in the refrigerator/freezer covered by my homeowners policy?
Most standard homeowners' policies provide coverage for spoiled food caused by a covered loss, such as fire or lightning, up to preset policy limits. You should contact your agent for information.
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Mortgage Insurance:
Do you offer Mortgage Life insurance?
Yes. Click Here to Get an Instant Quote Online.
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What is Mortgage Life Insurance (MLI)?
There are three types of Mortgage Life Insurance (MLI), Level Term, Decreasing Term, and
Accidental Death. All three policies will reduce the amount of your mortgage or pay it off, depending on
the coverage provided by the policy. For Decreasing Term policies the amount of insurance and the
mortgage balance decrease over time. The payout for Accidental Death policies occurs when the insured dies
in an accident. Level and Decreasing Term Life can be purchased to coincide with the length of the mortgage.
Each type of coverage has different restrictions and should be reviewed for appropriateness.
Click Here to Get an Instant Quote Online
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How is the cost of Mortgage Life Insurance determined?
Depending on the type of policy selected the insurance premium quoted when applying for Mortgage Life Insurance is determined by:
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the amount of the home loan at time of application; |
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the principal borrower's age; |
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tobacco use by the borrower.; |
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the term of the mortgage loan; |
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answers to health related questions. |
Click Here to Get an Instant Online Quote.
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How does an Accidental Death policy work?
Accidental Death and Dismemberment (AD&D) insurance provides additional funds in the event of a fatal accident or an accident that results in the loss of a limb or eyesight. For benefits to be paid, the death or loss must occur within 90 days after the accident and be a direct result of bodily injury sustained from that accident, independent of all other causes.
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What is Disaster Mortgage Protection (DMP)?
If the insured home becomes unlivable for 48 hours due to a disaster such as fire, flood, earthquake, hurricane, tornado, or hailstorm, this policy pays the monthly mortgage, including taxes and escrows, for up to 2 years. In the event that the home is permanently unlivable this policy pays the homeowner's policy deductible and may help pay the balance of the mortgage.
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Do you offer Mortgage Insurance?
Yes, Mortgage Life Insurance, which may pay off your or reduce the mortgage in the event of your death. We do not offer PMI (Private Mortgage Insurance.)
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Rental Properties:
If my property was damaged and the tenants had to move out could I recover lost income?
You can obtain coverage for loss of rental income that will reimburse you if the property cannot be occupied due to loss. There are policy limitations depending on the state in which the property is located.
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Flood and Earthquake:
What is a flood?
Flood is defined in the Standard Flood Insurance Policy (SFIP), in part, as:
"A general and temporary condition of partial or complete inundation of normally dry land areas from overflow of inland or tidal waves or from the unusual and rapid accumulation or runoff of surface waters from any source."
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What is the National Flood Insurance Program (NFIP)?
The NFIP is a federal program enabling property owners in participating communities to purchase insurance protection against losses from flooding. This insurance is designed to provide an insurance alternative to disaster assistance to meet the escalating costs of repairing flood damage to buildings and their contents.
Participation in the NFIP is based on an agreement between local communities and the federal government that states that if a community will adopt and enforce a floodplain management ordinance to reduce future flood risks to new construction in Special Flood Hazard Areas, the federal government will make flood insurance available within the community as a financial protection against flood losses.
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Does insurance under the NFIP provide coverage at replacement
cost?
Only for single-family dwellings and residential condominium buildings, if several criteria are met.
Replacement cost coverage is available for a single-family dwellings including residential condominium units that
are the policyholders' principal residences and are insured for at least 80 percent of the building's replacement
cost at the time of the loss, up to the maximum amount of insurance available at the inception of the policy term.
Replacement cost coverage does not apply to manufactured (i.e. mobile) homes smaller than certain dimensions
specified in the policy. Losses are adjusted on a replacement cost basis for residential condominium buildings
insured under the Residential Condominium Building Association Policy (RCBAP). The principal residence and
the 80 percent insurance-to-value requirements for single-family dwellings do not apply to the RCBAP. However,
coverage amounts less than 80 percent of the building's full replacement cost value at the time of loss will
be subject to a co-insurance penalty.
Contents losses are always adjusted on an actual cash value basis. If the replacement cost
conditions are not met, the building loss is also adjusted on an actual cash value basis. Actual cash value
is defined as the replacement cost of an insured item of property at the time of loss, less the value of physical
depreciation of the damaged item.
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What is a Special Flood Hazard Area (SFHA)?
In support of the NFIP, the Federal Emergency Management Agency (FEMA) has undertaken a massive
effort to identify and map flood hazard areas to produce Flood Hazard Boundary Maps (FHBMs), Flood Insurance
Rate Maps (FIRMs), and Flood Boundary and Floodway Maps (FBFMs).
Several areas of flood hazards are commonly identified on these maps. One of these areas is the
Special Flood Hazard Area (SFHA), which is defined as an area of land that would be inundated by a flood having
a 1 percent chance of occurring in any given year (also referred to as the base or 100-year flood). The 1 percent
annual chance standard was chosen after considering various alternatives, and constitutes a reasonable compromise
between the need for building restrictions to minimize potential loss of life and property and the economic
benefits to be derived from floodplain development.
Development may take place within the SFHA, provided that development complies with local
floodplain management ordinances, which must meet the minimum federal requirements. Flood insurance is required
for insurable structures within the SFHA to protect federal financial investments and assistance used for
acquisition and/or construction purposes within communities participating in the NFIP.
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What is the NFIP's Write Your Own Program?
The Write Your Own (WYO) Program, begun in 1983, is a cooperative undertaking of the insurance
industry and the Federal Insurance Administration (FIA). The WYO Program allows participating property and
casualty insurance companies to write and service the Standard Flood Insurance Policy in their own names.
The companies receive an expense allowance for policies written and claims processed while the federal government
retains responsibility for underwriting losses. The WYO Program operates within the context of the NFIP, and is
subject to its rules and regulations.
The goals of the WYO Program are to:
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Increase the NFIP policy base and the geographic distribution of policies; |
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Improve service to NFIP policyholders through the
infusion of insurance industry knowledge; and |
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Provide the insurance industry with direct
operating experience with flood insurance. |
As of October 1996, approximately 90 insurance companies had signed arrangements with FIA
to sell and service flood insurance under their names.
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How does a policyholder file a claim for flood loss?
A flood insurance policyholder should immediately report any flood loss to the insurance company
or agent who wrote the policy - in other words, the company whose name is on the certificate of insurance. A
claims adjuster will be assigned to the case, and the policyholder must file a "proof of loss" within 60 days
of the date of loss. A policyholder whose policy is with a WYO company must follow the company's claim procedures.
The 60-day time limit for filing a proof of loss remains the same.
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If a flood was caused by an earthquake and I have
Earthquake Insurance am I covered?
Yes, if the earthquake was the initiating cause of loss as confirmed by local authorities.
Earthquake deductibles would still apply.
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