Homeowner Insurance – What’s your type?

A Simple Guide to North Carolina Homeowners Insurance

This is the second installment of our Homeowners Insurance Blogs…

The average North Carolina homeowner insurance rate in April 2010 was $524.00 annually.  It appears that rates have decreased since March 2010 when average rates in North Carolina were around $531.00.  Saving money, even a paltry$7 dollars, is a good thing.  Currently in the state with such affordable house insurance rates, finding quality, affordable coverage is relatively easy for North Carolina residents. Purchasing house insurance is important in order to protect your home against perils of life, like fires, burglaries, wind damage, and more. However, although North Carolina’s climate is generally appealing, the state also sees its share of severe weather, particularly hurricanes. By choosing a well-rounded homeowners insurance policy, you can safeguard the investment in your home from these common perils.

Basic Coverages

North Carolina law does not require homeowners to insure their dwelling, but you would be reckless not to consider it.  However, if you have a mortgage, your lender will most likely require you to purchase at least a basic policy. A standard North Carolina home insurance policy will contain two sections with different types of coverages. Section I includes property coverages (A, B, C, and D), while Section II includes liability coverages (E and F).   Each type of coverage will be described briefly below.

• Coverage A (dwelling) – protects the actual structure of the home and any fixtures included within it (e.g., plumbing, air conditioning, heating, etc.). You should insure your dwelling for at least 80% of its replacement cost.
• Coverage B (other structures) – protects other structures on your property that may or may not be attached to the home, such as garages and sheds. The coverage limit for other structures is usually limited to 10% of the limit for Coverage A.
• Coverage C (personal property) – protects the belongings you and the members of your household store in your home. Coverage C is typically limited to 50% of Coverage A.
• Coverage D (loss of use) – pays for your living expenses while your home is being replaced or repaired after suffering a covered loss. Examples of covered living expenses might include the cost of a hotel and meals.
• Coverage E (personal liability) – provides protection if you or a member of your household are found legally responsible for injuring another person. Coverage E will pay for your legal defense and cover the cost of damages.
• Coverage F (medical payments) – pays for the medical costs of anyone injured accidentally on your property. This coverage applies only to people who do not live in your household.

Exemptions to Low Rates:  High-Risk Locations

The state of North Carolina offers alternative coverage options tohomeowners who live in high-risk areas and may not qualify for traditional home insurance coverage. For example, if your home is near a beach, it is more likely to suffer wind and storm damage, which makes it a high-risk location. If you live in a high-risk area, you may qualify for the North Carolina Joint Underwriting Association (NCJUA) FAIR plan. The FAIR (Fair Access to Insurance Requirements) plan pools the high risk of certain homeowners among many different property insurers. Any homeowner or renter can apply for a FAIR plan by contacting the North Carolina Department of Insurance.

Shopping for insurance is not fun anyone who would suggest otherwise should be considered for a psychiatric exam.  However the internet has made things easier to be sure.  I found a semi cool insurance website (is that even possible?) that allows you to scroll over any state and get an average policy rate.  Each state is click-able and you can start from there.  However, this is not an endorsement of this company and should not be construed as such.   However it is an easy way to get started and we encourage  you to check it out and use it as jumping off point  http://homeinsurance.com/rates-in-your-state/.

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This entry was posted on Thursday, June 3rd, 2010 at 9:38 am and is filed under Homeowners Insurance, North Carolina. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.