Dear Friends, Clients and Fellow Associates~
I asked Jeff Althoff an agent with Beaufort County Farm Bureau to help us all understand insurance in the Low Country. If you are looking for a comparison to your existing policies, or getting ready to buy a home or villa please feel free to give Jeff a call! All the best…Robbie
Buying homeowners insurance in the low country
There are different policies for various types of homes or condos, but the essential elements are coverage for the home structure, its contents (your stuff) and personal liability for your injury to another. In addition, living in the Low Country means we have to be concerned with wind coverage, as well as flood and earthquake. We will review each of the major coverage areas:
Dwelling – Coverage A – This first section covers your home structure from most common hazards or perils such as fire. You want to buy a policy that provides for the home to be insured for its replacement value (cost to rebuild the home not market value of the real estate.) Note that most policies exclude coverage for flood, earthquake, wear and tear and damage from insects.
Other Structures – Coverage B – This coverage is for structures that are not attached to the home, such as garages, storage sheds, playground equipment, and swimming pools.
Personal Property – Coverage C – This part of the policy insures your contents or the stuff you own. The coverage applies whether items are located at home or away from the premises. The limit found on most policies is usually some percentage factor of the base home amount. You want to be sure it is enough. Some items that have significant value should be insured separately such as jewelry, guns, antiques, fine arts and collectibles.
Loss of Use – Coverage D – This part of the policy covers additional costs for living expenses while your home is being repaired due to a covered loss.
Personal Liability – Coverage E – The homeowners policy covers your legal liability, attorney fees and judgments for causing personal injury or property damage to others. There are exclusions, but essentially this protection is in place for third parties that are hurt while on your premises or that you damage while away from your house (not in a vehicle).
Medical Payments – Coverage F – This coverage is to pay for minor injuries to guests in your home. For example, if your neighbor’s child is injured while playing at your house and needs to go to the emergency room for stitches.
Wind Coverage – The Low Country is considered a high risk for damage due to high winds such as hurricane or tropical storm. Depending on your location, you may have the wind coverage included in your policy, or purchased separately through the South Carolina wind insurance pool. This coverage usually carries a percentage deductible based on the value of the house.
Flood – Most policies exclude the flood hazard. Coverage is available through the Federal Government National Flood Insurance Program (NFIP). In the United States, more damage is done to homes from flood than any other type of claim! Don’t overlook this coverage even if your mortgage company does not require it.
Earthquake – Living in the Low Country does present exposure to earthquake. There is a fault line that runs through the area. Coverage usually can be added to the homeowners policy as an option.
How to save money on Insurance
Shop the market – This can be a lengthy process so give yourself plenty of time. Policies vary greatly from one company to the next. Do you want the services of a local professional insurance agent or are you ok dealing with that 800 number?
Increase your deductibles – You can save significant premium dollars by increasing your deductibles. Did you know that most homeowners policies never have a claim? Save some money but make sure you are comfortable with the amounts should a claim occur.
Insure your home for the correct value – Don’t confuse the market value of the home with its replacement cost. Remember you need enough coverage to rebuild the structure. You are not insuring the value of the land, just the house.
Look for other Discounts – Most companies will give credits or discounts off the premium for having or adding things like alarms, sprinkler systems and storm protection. In addition, some insurance companies offer discounts for having your auto insurance in addition to the homeowners policy. Many other discounts are available so make sure you ask about all that you may be entitled.
Maintain good credit – Companies use an insurance score based on your credit for determining your premium. So, the better your credit the lower you premiums!
It is hard to remember all the stuff you have after a major loss. You should take an inventory of your possessions and all the items in your home. Save receipts for the big ticket items purchased and consider taking pictures or videos throughout your home. Keep these records in a safe place.
Make sure you consider the financial stability and integrity of the insurance company where you are purchasing your policy. In today’s turbulent economy, big things are happening in the financial sector, and you want to be with a company that will be there for you should you need them at claim time. No one ever asks how much the policy cost after a major loss!
Every year or two it is a good idea to go through your policy and consider any changes. You want to update your policy to cover anything major like big purchases or additions to your home. But, you don’t need to continue paying for any coverage that you no longer need. You can complete this review on your own or through the services of a professional insurance agent.
Jeff Althoff, Agent
Beaufort County Farm Bureau
PO Box 4488
Beaufort, SC 29903
Ph: 843-522-0031 Ext. 234
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