0 HO 4 Insurance - How To Shop For The Best Policy

HO 4 insurance, or renter's insurance policy, is designed to protect the belongings of someone who rents a home.  HO 4 insurance is an often neglected insurance policy, but is important to the financial well-being of those who choose to rent a home, apartment, or other dwelling.  Here are some tips on how to find the right HO 4 insurance policy.

When deciding on a HO 4 insurance policy, you first need to determine how much insurance you need to replace your belongings in the event of a loss. Get a sheet of paper and list all of your belongings room by room.  Beside each item list the amount you paid for each item along with the model number of the piece.  This will serve as a list you can use to show what you have in the event of a loss.

HO 4 insurance policies also include liability coverage, like an HO3 policy, to protect you in the event of a lawsuit.  Standard with the policy is $100,000 of coverage, but amounts up to $500,000 may be available with most policies.

Once you get the replacement cost value of your belongings, it's time to start shopping.  The first step in finding an HO 4 insurance policy would be to go to an online insurance quote site to get premium estimates.  These sites will quote insurance costs from available insurers and will give you a good ballpark estimate of what you will pay.  Don't make the assumption that the lowest premium is the best; take a look at the financial rating of the company to make sure they are stable.  Look for a minimum of an "A" rating from one of the rating services like A.M. Best.

Once you choose the best couple of premium estimates, call a couple of local insurance agents in your area for quotes.  Give them the replacement cost you figured earlier in order to better compare quotes.  Be sure to indicate you want replacement cost coverage on your belongings. 

Shopping for a good HO 4 insurance policy needn't be hard or time consuming.  Do your work ahead of time, get several quotes, check out the companies, and look for a local agent to use if possible.  Being properly insured can help avoid a financial setback in the event of a major loss.

0 How To Shop For HO3 Insurance

HO3 insurance, or standard homeowner's insurance policy, is designed to protect the largest investment most people will ever make.  Unless you happen to work in the insurance field however, choosing the right insurance coverage can be a daunting challenge.  Here's how to make the right choice when deciding on an HO3 insurance policy.

When deciding on a HO3 insurance policy, you first need to determine how much insurance you need; specifically, how much insurance do you need to rebuild your home if it is destroyed.  The calculated replacement cost is the total cost of rebuilding your home as close to what you have now and is the figure to use.  This includes not only the building materials, but the labor and cleanup costs.  This figure is different from the market value of the home, which is what either you paid for the home or it is appraised for, and should not be used in deciding on a home's insured value.  These two amounts could be close or they could be vastly different depending on market values in the surrounding community. The recent fall in home values illustrates how this could fluctuate.

To determine the replacement cost of your home, use one of the free online building cost estimators like www.building-cost.net to get an estimate.  Another way is to use a rule of thumb of $100 per square foot of living area for a standard home.  For example, if the living area of your home is 1500 square feet, an approximate replacement cost value would be $150,000.

Once you get the replacement cost value, it's time to start shopping.  The first step in finding an HO3 insurance policy would be to go to an online  insurance quote site to get premium estimates.  These sites will quote insurance costs from available insurers and will give you a good ballpark estimate of what you will pay.  Don't make the assumption that the lowest premium is the best; take a look at the financial rating of the company to make sure they are stable.  Look for a minimum of an "A" rating from one of the rating services like A.M. Best.

Once you choose the best couple of premium estimates, call a couple of local insurance agents in your area for quotes.  Give them the replacement cost you figured earlier in order to better compare quotes.  Having a local agent to work with will save you time and can do all the work for you, if their quoted premium is competitive.

Shopping for a good HO3 insurance policy needn't be hard or time consuming.  Do your work ahead of time, get several quotes, check out the companies, and look for a local agent to use if possible.  By doing these steps, you will sleep better at night knowing your home is properly insured.

0 How Expensive is an H06 Insurance Policy?

How Expensive is an HO6 Insurance Policy?

 

An HO6 insurance policy has many factors that determine the premium charged by the insurance company.  Although premiums will differ between insurance companies, there are similarities in determining the premium charged that you need to be aware of. Knowing how this premium is calculated can help you in choosing a condominium that won't cost you a fortune to insure.

The first factor that the insurance company looks at is location; specifically what state the condo is in.  Premiums are different from state to state depending on many factors such as amount of business the company has there, what claims experience they have, and how close to a fire department it is located.  The fire protection class of the fire department is used in the pricing as well as whether the condo is located in a city or not.

Also important in location is whether the condo is exposed to unusual risks, such as flooding and hurricanes.  Many millions of dollars have been spent repairing hurricane damage, as we have recently seen in New York, and premiums have to reflect this risk.

Another factor that affects how expensive an HO6 insurance policy can be is how much coverage you need and how high a deductible you are comfortable with.  The deductible is the amount of money you pay first in the event of a claim before the insurance kicks in.  The higher the deductible, the lower the premium.  Keep in mind that HO6 insurance, as well as any other type of insurance policy should not be thought of as a way to pay for any smaller claims, so look to getting a higher deductible on the your policy, at least $1000 to save money.

The type of replacement coverage you have also has an effect on the premium charged.  Policies can be purchased by most companies two ways; replacement coverage or actual cash value, also known as ACV.  In a HO6 insurance policy the replacement cost option will pay to replace your home just like it is now without any deduction for depreciation.  The ACV coverage deducts money for claims based on the age of the insured part.  For example, in the event of a total loss of a roof, the ACV policy will deduct so much from the payment of the claim based each year of age of the roof, resulting in a lower payout and more for you to pay.  The replacement cost coverage replaces the roof completely regardless of the age.  Obviously the replacement cost coverage is more expensive than the ACV policy due to paying better when a claim is filed.

Yet another factor the insurance company looks at is your personal claim history; in other words how likely you are to file claims.  As stated before, HO6 insurance is meant to cover large losses.  If you have several small claims of $200 - $500, the insurance company will look unfavorably on your application and price the policy accordingly.

How expensive an HO6 insurance policy is can depend on many factors, so the best idea is to get several quotes before you decide on a particular company.  It can save you money in the long run.

0 HO4 Insurance - What is renters insurance?

Just because you rent a home, it doesn't mean you don't need insurance.  After a lifetime of buying clothes, furniture, and other belongings, a house fire can take everything from you.  Some people think that the landlord has insurance to replace these things in the event of a devastating loss like a house fire, but the dwelling fire policy covering the home will not pay for your loss. 

To take care of your possessions in the event of a loss, you need what is known as HO4 insurance, also called a renter's insurance policy. This policy provides similar coverage as the HO3 insurance policy, or homeowners policy, without the coverage for the building.

The first section of the HO4 insurance policy is called the personal property section.  This provides money to repair or replace your belongings.  This coverage is available in either Actual Cash Value or Replacement valuation.  The ACV pays for the depreciated cost of what you lose, where the replacement policy does just what it says; it pays you money to replace what you lose.

The second section of the HO4 insurance policy is called the Liability Coverage section.  This part provides money to pay legal damages in the event he or she is found liable in a lawsuit. Some may believe they may never get sued, but if you have a visitor that gets hurt while in your residence, it could happen. We have all heard stories about a family pet who decides to bite a person who may be visiting.  If this happens to you, you'll sleep better knowing you have insurance to cover this.

Another part of the liability section of the HO4 insurance policy provides money to pay medical expenses in the event someone gets hurt while at the home you are renting, but decides not to sue.  This part is called Medical Payments to Others and pays reasonable medical costs to someone also hurt at your residence. An example would be a visitor who falls off the porch and breaks an arm.  The Medical Payments to Others clause could provide money to pay their medical expenses up to a purchased limit.

When considering an HO4 insurance policy, first add up what possessions you own and calculate a replacement value.  Use this number for the Personal Property limit. Also decide on whether you want ACV or replacement cost.  The ACV will be less expensive, but you may have to make up some of the cost of replacing your items out of your pocket.

Next, decide on the deductible to buy, which the amount of money you would have to pay first before the insurance policy would pay.  The rule of thumb is the lower the deductible, the higher the premium.

Lastly, as with all insurance, it pays to shop around.  Go to one of the online insurance quoting sites and run some quotes to get a feel for how much premium you are looking at.  Then if you would like, take your quote to a local insurance agent to see if you can get a better price.  Renting a home can be easy, but be prepared.  Get a good HO4 insurance policy take care of those things in life that happen to everyone.

1 H06 Insurance Policy or Condo Master Policy - What's the Difference?

H06 Insurance Policy or Condo Master Policy - What's the Difference?

If you are thinking about buying a condominium, you might have questions about who insures what.  In a typical condominium, there might be many separate housing units owned by separate owners, and dealing with insurance issues can be complicated.  Let's take a look at the insurance policies that are used for condominiums - the H06 insurance policy and the condominium master policy.

A condominium consists of individual family or business unit housed in a common structure.  There are also sidewalks, landscaping, and other elements, called common areas that are for the use of everyone.  The building itself consisting of the roof, exterior side walls, entrances, frame, and the common areas previously mentioned are insured with a condominium master policy, purchased by the condominium homeowners association.

Each homeowner in the condominium is responsible for insuring everything else associated with his or her own unit.  Furniture, fixtures, appliances, floor covering, and any personal possessions should be insured with the H06 insurance policy.  An easy way to think of it is the homeowner is responsible for insuring everything from the studs in the walls in.

With two policies like this, sometimes there can be confusion over which insurance company is responsible for paying claims.  A general rule of thumb is that a loss created by a common element that does damage to an individual unit should be covered by the master policy.  For example, if the roof leaks and causes damage to the ceiling in an individual unit, the master policy should generally pay for the repairs.

Both policies will come with a limit of liability protection in the event of legal damages awarded to someone who sues a condo owner or the association itself.  The condominium master policy usually will have a much higher limit of insurance due to the increased exposure of multiple tenants.  It is not rare to have the master policy have a limit of liability coverage of $5 million plus.

It is a good idea to ask for a copy of the limits of insurance of the master policy, called the declarations page, to know and understand what coverages are in place.  This will enable you to purchase an H06 insurance policy and equip it to provide for any gaps in coverage the master policy may have.

If you are going to purchase a condominium, the mortgage company or bank will ask you for a copy of your H06 insurance policy to prove you have insurance.  They will  need a copy of the declarations page of the condominium master policy also to show that there is adequate coverage for the common areas in the event of a disaster.

Owning a condominium can be convenient and for the most part maintenance free.  Make sure you have the right insurance in place to protect your most valuable asset.

0 HO3 policy - How much insurance do I need?

Determining how much insurance for your home is an important task.  On one hand, you don't want to pay more than you have to.  On the other, if you have a catastrophic claim, such as your home burning to the ground, you want to make sure you have enough.  Let's take a look at the different coverages available in the HO3 policy and how to figure how much you need.

The first section to look at is called Coverage A on the policy.  This is the coverage that most people will refer to when they look at their policies.  Coverage A gives the limit of insurance paid out on a claim to your home from the standpoint of the building itself.  To determine how much insurance you need, you need to be able to know how much money it would cost to rebuild your home just as it is standing now.  There are several ways to do this, but most companies use what is known as a replacement cost estimator to calculate building material cost and labor.  The agent you are working with can do this for you.

The second number to figure is the replacement cost of your property in the home.  On the HO3 policy this is found in Coverage C.  This includes all movable property such as furniture and clothing.  It is helpful to take a quick inventory of your personal property room by room to figure how much coverage you need.  A good HO3 policy will cover your personal property at 75% of what is written for Coverage A, which is usually sufficient, but it never hurts to make sure.

Next you want to look at the liability coverage on your policy, which will be found under Coverage E on the HO3 policy.  This pays for legal claims against you for covered occurrences.  Most people will use the default minimum of $100,000, but look at what you have to loose in a court case, and you can quickly see that the minimum is usually not sufficient.  The liability coverage of the policy is one of the least expensive parts of the premium, so in this case, it is better to have too much than too little.

Lastly, take a look on the HO3 policy under Coverage F, called Medical Payments.  This part of the HO3 insurance policy pays for medical bills in the event someone gets hurt on your property, such as a neighbor kid breaking an arm.

Take a little time to figure out how much coverage is proper for your home.  It takes some time to get the right HO3 policy, but better to be prepared beforehand than find out later you don't have enough.

0 What To Look For in an H06 Insurance Policy

What To Look For in an H06 Policy

You've made the decision to purchase a condominium, you've looked at numerous properties, you've made an offer that was accepted - congratulations!  Now you go to your mortgage company to get a loan, and they ask you if you have found an H06 policy, or condo policy. How do you make an informed decision about what to buy?  Let's talk about what to look for in a condo policy.

The first thing to do is determine how much coverage you need.  Unlike a homeowners policy, or H03 policy, condominium associations will have a master policy to cover the exterior building and common areas, such as the outside walls and sidewalks.  The H06 policy needs to be written to cover the other areas the new homeowner is actually responsible for such as interior walls, flooring, and built in appliances.  Get a copy of the master policy and see what is included and what you will need to insure.

Second, take an inventory of your movable belongings, called personal property.  Add up the cost of these items and put together an estimate of how expensive it would be to replace them.

Next, determine how much liability coverage you will feel comfortable with.  The liability portion of the H06 policy pays for legal expenses and judgments in the event you are sued for covered losses.  A rule of thumb is to add up the equity in your home, the amount of savings you have, and 5 - 7 years income.  $100,000 is the norm, but in these days of higher and higher damage awards, it is better to have too much than not enough.

Once you have these numbers, it's time to find a reputable insurance company that sells the H06 policy.  First, go to an online quote site and have them compare insurance companies for you.  Keep in mind that the lowest premium is not always the best choice.  Make sure you are working with a financially stable company.  This is found out easily by going to the insurance company's website and getting their financial rating done by a third party source, such as A.M. Best or Moody's. These ratings are shown by the letters A through F, with the A being the best.

If you have a company that you are comfortable with already, now is the time to take those quotes to your local agent and ask for a competitive quote.  Tell him or her that you want an "apples to apples" comparison in order to get the best deal.  In this manner, you know you will have done everything possible to save money.

Getting an H06 policy correctly can take a little time and legwork.  However, it is better to do your homework up front and know you are properly insured than to have a insurance claim and find out too late you did not have enough coverage.