Saving Money on Homeowner Insurance

Insurance may be necessary, but it doesn't have to be expensive.  Stacy Johnson brings you a way to save on homeowner's insurance.

If you have any questions about how to save money on your homeowner's insurance, leave your question below by clicking on the comment link.  Your Email Address, although needed to send us your question, will NEVER be published here to protect your privacy.

Should You Insure Your Landscaping?

You've bought a house and insured the structure, the furniture and your most prized possessions.  Should you also insure your trees and shrubs?

Check your homeowner's policy.  You'll probably find that coverage for your landscape is quite limited.  Most basic homeowner's policies pay a certain percentage, say 5%, of the total coverage limit of the home for damaged landscaping, with payouts for any one tree, shrub or other plant capped at $5,000.

Homeowners' policies typically only cover losses in certain situations — like fire, lightning, explosions, theft, riot and civil commotion or damage from passing cars. If a tree falls on an insured structure during a wind, ice, snow or hailstorm, policies will pay to remove the tree and to repair the structure. But they usually won't pay to replace a tree felled by a storm.

Since weather-watchers have predicted more severe storms in the coming years, many homeowners are looking to add wind riders to their policies, but check with your carrier, since not every insurance company offers such policies or riders.

Even if you can't get or don't have insurance on your trees and incur a loss, you still may be able to claim a deduction for such a casualty loss on your federal income tax.  The Internal Revenue Service defines such a loss as "resulting from an identifiable event of sudden, unexpected, or unusual nature," and includes the usual incidents that most insurance companies cover, as well as storms, floods, vandalism and soil and air pollution.

Low Cost Home Insurance  

Most every homeowner agrees that a reliable home insurance policy is a priority.  We present a few ways on how to obtain sufficient homeowner's insurance without spending a fortune.  

1. It always pays to spend some time shopping around. The easiest way is to access the Internet and check different rates of homeowner's insurance companies.  For best results, you should compare the insurance quotes of at least three different insurance companies.  

2. Some companies offer a discount of 30-45 % if you purchase a policy online.  

3. One can benefit from discounts if he/she purchases a house and contents insurance policy. Insuring a house and a car by the same insurer may substantially lower your insurance rate.  

4. A homebuyer should be aware of the replacement values of the home. It is advisable to obtain replacement value coverage.  

5. Keep in mind the inflation rate when the time comes to renew your insurance policy.  Many insurance companies automatically adjust your coverage to allow for inflation.  Check with your insurance policy to be sure.  

What is your opinion about homeowner insurance and the tips here?  Leave us a comment below.

Floods Are Not Covered

Most people know this, or at least SHOULD, but for some reason, always think, "Oh, we're not in a flood zone, so we're in no danger of flooding.. why buy flood insurance?"

Floods, aren't covered under homeowners insurance policies — something many Katrina victims learned to their chagrin.  The National Flood Insurance Program, run by the Federal Emergency Management Agency, offers coverage.  If you live in an area that's prone to either floods or hurricanes, you need both wind and flood coverage.

It seems that not a week goes by any more that we don't hear news about floods from heavy rains in areas that have never flooded before, or at least not in a very long time. 

So don't be negligent or niave in thinking "flooding will never happen to us.. we're not in a flood zone."  Neither were millions of Americans who have sustained some sort of flood related damage to their homes recently, and had no coverage for the damage.

If you're the victim of a landslide, however, you're pretty much on your own.  That kind of earth movement usually isn't covered, so it pays to get a geologist's report before buying any home near a cliff or on a hill.

Have you experienced flood or water damage that was not included on your homeowner insurance policy?  We'd love to hear from you.  Leave us your comment below.

No Wind Coverage?  Would You Take That Risk?

A small but growing number of homeowners are taking an extreme approach to insurance against hurricane winds: They're going "bare" — doing without the coverage entirely.

While the option of doing without wind coverage is generally limited to people who don't have mortgages — banks typically require borrowers to carry insurance — even a slender increase in those going uncovered could have broader repercussions in the wake of another major storm.  A drop in insurance payouts could leave storm-struck areas with fewer resources for rebuilding and shift some of the burden to taxpayers.  That more individuals are opting to go without coverage also underscores the breakdown of the insurance system in coastal areas.

Some insurance agents say they are seeing an increase in the number of clients who have taken the plunge of going uncovered or discussed the option.

We're curious on this…  would you take the risk (if given the option and you were not dictated or made to have wind coverage by your mortgage) of going without this coverage just to shave a few bucks off of your premiums?  We'd love to hear your comments on this by clicking the comment link below and telling us what you think.