INSURANCE
roof or buying stronger roofing materials. Older homes can be retrofitted to make them better able to withstand earthquakes. In addition, consider modernizing your heating, plumbing and electrical systems to reduce the risk of fire and water damage.
6. Improve your home security. You can usually get discounts of at least
5 percent for a smoke detector, burglar alarm or dead-bolt locks. Some companies offer to cut your premium by as much as 15 or 20 percent if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire or other monitoring stations. These systems aren’t cheap and not every system qualifies for a discount. Before you buy such a system, find out what kind your insurer recom- mends, how much the device would cost and how much you’d save on premiums.
7. Seek out other discounts. Companies offer several types of dis- counts, but they don’t all offer the same discount or the same amount of discount in all states. For example, since retired people stay at home more than working people they are less likely to be burglarized and may spot fires sooner, too. Retired people also have more time for maintaining their homes. If you’re at least 55 years old and retired, you may qualify for a discount of up to 10 percent at some companies. Some employers and professional associations administer group insurance programs that may offer a better deal than you can get elsewhere.
8. Maintain a good credit record.
Establishing a solid credit history can
cut your insurance costs. Insurers are in- creasingly using credit information to price homeowners insurance policies. In most states, your insurer must advise you of any adverse action, such as a higher rate, at which time you should verify the accuracy of the information on which the insurer re- lied. To protect your credit standing, pay your bills on time, don’t obtain more credit than you need and keep your credit bal-
60 HISPANIC NETWORK MAGAZINE
ances as low as possible. Check your credit record on a regular basis and have any er- rors corrected promptly so that your record remains accurate.
9. Stay with the same insurer. If you’ve kept your coverage with a company for several years, you may re- ceive a special discount for being a long- term policyholder. Some insurers will re- duce their premiums by 5 percent if you stay with them for three to five years and by 10 percent if you remain a policyholder for six years or more. But make certain to periodically compare this price with that of other policies.
10. Review the limits in your policy and the value of your possessions at least once a year. You want your policy to cover any ma- jor purchases or additions to your home. But you don’t want to spend money for coverage you don’t need. If your five-year- old fur coat is no longer worth the $5,000 you paid for it, you’ll want to reduce or cancel your floater (extra insurance for items whose full value is not covered by standard homeowners policies such as ex- pensive jewelry, high-end computers and valuable art work) and pocket the differ- ence.
11. Look for private insurance if you are in a government plan.
If you live in a high-risk area—say, one
that is especially vulnerable to coastal storms, fires, or crime—and have been buying your homeowners insurance through a government plan, you should check with an insurance agent or company representative or contact your state depart- ment of insurance for the names of compa- nies that might be interested in your busi- ness. You may find that there are steps you can take that would allow you to buy insur- ance at a lower price in the private market.
12. When you’re buying a home, consider the cost of homeowners insurance.
Celebrating 19 Years of Diversity You may pay less for insurance if you
buy a house close to a fire hydrant or in a community that has a professional rather than a volunteer fire department. It may also be cheaper if your home’s electrical, heating and plumbing systems are less than 10 years old. If you live in the East, con- sider a brick home because it’s more wind resistant. If you live in an earthquake-prone area, look for a wooden frame house be- cause it is more likely to withstand this type of disaster. Choosing wisely could cut your premiums by 5 to 15 percent. Check the CLUE (Comprehensive Loss Underwriting
Exchange) report of the
home you are thinking of buying. These re- ports contain the insurance claim history of the property and can help you judge some of the problems the house may have. Remember that flood insurance and earthquake damage are not covered by a standard homeowners policy. If you buy a house in a flood-prone area, you’ll have to pay for a flood insurance policy that costs an average of $400 a year. The Federal Emergency Management Agency provides useful information on flood insurance on its Web site at
FloodSmart.gov. A separate earthquake policy is available from most insurance companies. The cost of the cov- erage will depend on the likelihood of earthquakes in your area. In California the California
earthquakeauthority.com)
Earthquake Authority (www. provides
this
coverage. If you have questions about insurance for any of your possessions, be sure to ask your agent or company representative when you’re shopping around for a policy. For example, if you run a business out of your home, be sure to discuss coverage for that business. Most homeowners policies cover business equipment in the home, but only up to $2,500 and they offer no busi- ness liability insurance. Although you want to lower your homeowners insurance cost, you also want to make certain you have all the coverage you need.
Source: Insurance Information Institute
www.iii.org
C M Y CM MY CY CMY K
www.hnmagazine.com
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