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Home buyers checklist, home insurance houston, suzanne brown insurance

Shopping for a new house?  Here are some tips to get the best insurance rates.

Generally, you will be offered the best insurance rates when you:

1.  Purchase newer construction.   If the home is built within 10 years the discounts can be as much as 40 percent.
2.  Choose a safer location.   Coastal properties will be harder to insure due to storm risk but farther from the coast should receive multiple competitive quotes.
3.  Live outside of the 100 year flood plain.   Ask an insurance agent what flood zone your new home will be in.   If you are located in a 100 year flood plain, you could pay the highest flood insurances rates. 
4.  Have a good insurance score which is the combination of good credit score and claims free history.

While House Hunting

As you search for your new home, remember that the physical characteristics of the house—its size, location, construction and overall condition—can affect the cost, choice and availability of home insurance. Following are some factors to consider when shopping for a home:
Quality and Location of the Fire Department
Houses that are located near highly-rated, permanently staffed fire departments usually cost less to insure. This also holds true for homes that have a hydrant nearby. An important underwriting criterion for insurance companies is a community’s investment in fire protection, which includes trained firefighters, proper equipment and adequate supplies of water.
Proximity to the Coastline
Houses located on or near the coast will generally cost more to insure than those further inland. There will also likely be a higher hurricane or windstorm deductible.    In coastal areas with high wind risk, some homeowners may select higher hurricane deductibles to lower their insurance premiums, but that means they pay more if their home is damaged.
Age of the Home
A stately, older home can be quite beautiful, but ornate features such as plaster walls, ceiling molding and wooden floors may be costly to replace and raise the cost of insurance. Plumbing and electrical systems can become unsafe with age and lack of maintenance. So, older homes may cost more to insure. If you are considering buying an older home find out how much it will cost to update these features and factor it into the cost of ownership.
Condition of the Roof
Ask about the condition of the roof. A new roof matters to insurers and keeps you and your family safer. Depending on the type of roof and whether or not you use fire and/or hail resistant materials, you may even qualify for a discount. Talk to your insurer about qualifying discounts.
Is the Home Well-Built and Up to Code?
Find out whether the house has been updated to comply with current building codes. Homes built by careful craftsmen and those built to meet modern engineering-based building codes are likely to better withstand natural disasters. Consider hiring a licensed home inspector who is knowledgeable about the latest building codes to inspect the property before you sign a mortgage.
Risk of Flooding
Damage from flooding is NOT covered by standard home insurance policies. If you are buying a home in an area at risk from flooding, you will need to purchase separate insurance.  Ninety percent of all natural disasters in the U.S. involve flooding, according to the NFIP. More important is that 25 to 30 percent of all paid losses for flooding are for damage in areas not officially designated as special flood hazard areas. If you are not in a high-risk flood zone, NFIP coverage is available at a lower premium.
Swimming Pool or Other Special Feature
If the house has a swimming pool, hot tub or other special feature, you will likely need more liability insurance. You may also want to consider purchasing an excess or umbrella liability policy to provide added protection in the event someone gets injured on your property and decides to sue you.

Before You Place a Bid on the Home

Check the Loss History Report
Ask the current owner of the house for a copy of the insurance loss history report, such as a Comprehensive Loss Underwriting Exchange (C.L.U.E.) report from ChoicePoint or an A-PLUS report from ISO, a leading source of information about property/casualty insurance. This is a record of insurance claims on the house that can provide answers to two questions that any savvy homebuyer should ask:
  • Have there been any past problems in the home?
  • If damage has occurred, was it properly repaired?
Note that prior claims are not a barrier to getting insurance. In fact, sometimes a recent claim can have positive ramifications. If, for example, a roof was damaged by a wind storm and replaced by a new one, this would make the house more desirable to an insurance company. If there have been no claims within five years, there will be no loss history report on the home.
Get the House Inspected
A thorough inspection of the home is very important. The inspector should:
  • check the general condition of the home;
  • look for water damage, termites and other types of infestation;
  • pay special attention to the electrical system, septic tank and water heater;
  • show you where potential problems might develop;
  • double-check that past problems have been repaired;
  • suggest upgrades or replacements that may be needed.
Determine How Much It Will Cost to Maintain the House
Routine maintenance is your responsibility as a homeowner. Losses caused by failing to properly care for your home are not covered by standard homeowners insurance policies. The yearly cost of taking care of your house is another factor to be included in the overall price of owning the home.
Use an independent insurance agent to shop your insurance.
Don’t wait until the last minute to think about insurance.  Use an independent insurance agent to shop multiple carriers for you.  Insurance is an important consideration when purchasing a home.
Purchasing Insurance for your New Home
When purchasing a home insurance policy, work with your insurance agent to get enough insurance to rebuild the house in the event of a total loss. No new home buyers want to think that their house could go up in flames, but disasters do happen. It’s important to have enough insurance to completely rebuild your home and replace all of your personal possessions. You also need to make sure you have enough liability insurance to protect your financial assets. Ask about additional coverage such as:
  • Replacement cost for personal possessions
  • Extended or guaranteed replacement cost for the structure
  • Building code upgrades
  • Sewer and drain back-up coverage
  • Inflation-guard
  • Umbrella coverage for a pool or other high-risk items
  • Special riders for jewelry, collectibles and expensive items
To save money on your homeowners insurance, shop around and take the highest deductible you can afford. Since most people only file a claim every eight to 10 years, having a higher deductible saves money over time and preserves your insurance for when it’s really needed. You can also ask about available discounts for:

  • Multi-policy (home, car or other policies with the same company)
  • Smoke detectors
  • Fire extinguishers
  • Sprinkler systems
  • Burglar and fire alarms that alert an outside service
  • Deadbolt locks and fire-safe window grates
  • Being 55 years old and/or retired
  • Long-time policyholder
  • Upgrades to plumbing, heating and electrical systems
  • Wind-resistant shutters

Contact our office at suzanne@suzannebrownagency.com if you have questions about getting quotes for your home insurance.

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