Which Homeowners Policy is Right For Me?

What kind of home? You may not be looking at the correct article.

This is the right place if...

You own a home (free standing, not rented, not a mobile home i.e.: the home is permanently attached to and part of the foundation).

Or

You own a town-home (not a condominium or co-op or time share). Perhaps this town home is attached to another residence, perhaps not. I own the land that this town home sits on, but I am part of a town-home community) act. Typically, a mobile or manufactured home owner policy will provide coverage that’s quite similar except for the following:

This is not the right place if...

See “I own or rent a trailer, manufactured housing, or double-wide...”

See Condominium or Co-op? Your Insurance Needs are Different

You will need to go elsewhere after reading this article if...

I Own a Time-Share in Addition to Having Another Residence...

NOW! You own a home...

Many companies have either their own Homeowners policy form or have endorsements to standard policy forms that help distinguish them from the competition. Some companies like new, high-valued homes, some companies do well with older or historic preservation homes. Others are comfortable with country homes or old farm homes and some don't like the city. It pays to shop around, both for the best coverage and for a company who likes homes in your area.

Find a company that wants to insure your home. If the company and agency already has a customer base in your area, consider them first. They understand how to insure homes like yours. This agency or company may not always have the cheapest policy, but they may have the best combination of coverage, price, service and claims expertise for your particular needs.

Two Types of Coverage: Named Causes of Loss or Risks of Physical Loss

• Named causes of loss coverage is just that. The policy only covers for certain kinds of causes of loss to your property. You must prove to the company that one of the covered causes damaged your property.
• Risks of physical loss covers all causes of loss except those that are excluded. The company must prove that one of the excluded causes of loss damaged your building.

Risks of physical loss covers all causes of loss except those that are excluded. The company must prove that one of the excluded causes of loss damaged your building.

• The washing machine in the spin cycle danced across the room and broke the water heater, cascading water throughout the home.
• A guest injured herself and bled all over the couch and carpet.
• While the insured cleaned the imported crystal chandelier, the chandelier fell, shattering into pieces.
• While working on the attic floor joists, the insured slipped and put his foot through the ceiling.
• A two year old boy went on a rampage with a hammer, smashing the bathroom toilet, sink, walls etc...
• The insured dropped a storm window. It cascaded through the home, down the stairs, damaging walls along the way.
• The insured was cleaning the bowling ball in the bathroom sink – the bowling ball slipped and shattered the sink.
• The insured’s lawnmower kicked a rock through the exterior air conditioner.
• The insured slipped and threw a full paint can into the room; the spray hit virtually everything in the room.
• Freezing and thawing of ice on the roof caused a break in the wall and water damage to the interior of the home.

The policy name for risks of physical loss coverage for buildings is often referred to as Homeowners form 3. To add risks of physical loss to personal property under form 3, you must have the Homeowners 15 endorsement. Some companies sell a Homeowners form 5 which does the same thing as the combined Homeowners 3 plus the Homeowners 15 endorsement. Other companies have their own risks of physical loss forms they call Special, Gold, Executive etc. Not everyone will qualify for risks of physical loss, but most companies sell the coverage.

NOTE: Your state may have restrictions or natural disaster cause of loss problems. Coastal states face wind problems. California, and certain Midwestern areas have severe earthquake problems. Some Western states have brush fire problems. Other areas face hail damage. Each state and company has its own rates and philosophy on how it will insure these common causes of loss. Check around.

Policies that are considered named causes of loss forms are the Homeowners 1 (not sold much any more), the Homeowners 2 and the special use Homeowners 8 forms

Homeowners 8

• Insures for the same causes of loss as the Homeowners 2 form.
• Designed for older homes. Older homes generally were built with more expensive and/or exotic materials. You could not build most turn of the century homes today for any price.
• Contains no coinsurance penalty. You and the company agree on a maximum coverage limit if the building burns to the ground.
 NOTE: in most states the company only has to pay for the actual cost to repair or replace, so if the building costs less to rebuild than the limit of insurance, only the cost to rebuild is paid...
• Not all companies will write the Homeowners 8. Some states do not permit the sale of this policy.

Basic Homeowners coverages common to all homeowners form that insure both the home and personal property...

Independent insurance brokers providing personalized financial planning and insurance services including homeowners insurance, business insurance, professional liability and group medical benefits. Murray, Schoen & Homer Inc is a New York State licensed insurance agency located in New Rochelle, NY and serves the surrounding Westchester County communities including Larchmont, Mamaroneck, Mt. Vernon, Harrison, Eastchester and Pelham, New York.

As a licensed entity in the State of New York we want to notify you that this is not an offer to sell insurance or an
advertisement of insurance anywhere except the State of New York, United States of America.