There are many aspects that influence shopping for home insurance and finding the policy that best suits your needs. Your policy is only as good as the contract itself. There are ways to balance price with value if you can understand the basics behind your home insurance policy.
It is crucial to get the right information before a claim occurs. All policies contain limitations and clauses that can either enhance the coverage or limit coverage. A policy that isn’t suited to your home and its needs could be useless when you need it most. So how can you determine what kind of policy you need?
Home Insurance Comparison
There are several layers where the policy wording will make a difference. It is important to know the difference between HO-2, HO-3 and HO-5 insurance. The general coverage offered is often defined via policy form. For example, the Homeowners Broad Form (HO-2), Homeowners Special Form (HO-3), and the Homeowners Comprehensive Form (HO-5).
Each of these policy forms offers varying levels of coverage, the higher the HO number, the better the coverage. The HO-2 offers limited coverage, the HO-3 offers intermediate coverage giving all-risk on the building, but only named perils (limited coverage) on the contents, whereas the HO-5 covers personal property and the building for full coverage on an all-risk basis. If you can’t afford the highest level of coverage, ask if you can add the coverage you need by an endorsement, or increase your deductible.
The trick to home insurance comparison is discovering the one that will give you the most advantage in a claim, this goes beyond the policy form, especially if this is your first home insurance policy. Consider various value added features, special limits, clauses and claims handling philosophy.
It’s common to do a home insurance comparison to those you consider similar to you, such as a neighbor, however policies and needs differ greatly.
Special Limits are clauses within your insurance policy that specify areas where the coverage will be limited in the event of loss. Common items that typically have special limits or exclusions associated with them are:
- Collections and collectibles
- Fine Arts
- Sporting Equipment
- Swimming pools
If you obtain any of these, ask your agent to take this into consideration when recommending coverage to you and find out if the policy you are looking at has limitations or exclusions. You can also ask to have coverage added by a rider or endorsement.
Do you have small children at home, or maybe college aged kids? Do you have parents in a nursing home? We don’t always think about these things when we are buying home insurance, but there are limits or special features that could work to your advantage by exploring these questions. It may even save money on additional coverage elsewhere.
Do you have pets? Ask how they can be covered. Do you travel often? Some policies will have higher limits for contents off premises or temporarily removed. Speak to an agent to fully grasp home insurance comparisons.
About IFS Insurance
At IFS Insurance, we specialize in protecting homeowners and renters throughout Delaware, New Jersey, Pennsylvania, and Maryland. Our quality solutions and commitment to excellence has allowed us to serve these states for over 50 years. For more information about our products, we invite you to contact us today at (800) 598-0420.