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Homeowner Insurance – What’s your type?

June 3rd, 2010

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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Insurance – Don’t Leave Home Without It.

May 27th, 2010

Home Insurance We All Need It.

Insurance is an aspect of life that we never really like to      discuss.  We certainly don’t like to discuss the reasons for  it.  No one needs insurance on a sunny day, or when  people are in good health.  We all can visualize scenarios  where we do need it – rarely are those pleasant images or conversations to have.  Recently I had a uncomfortable conversation with my parents about their final wishes and insurances.  It was a stomach turning and awkward conversation to say the least.

However, as bothersome as it is a topic of discussion, having insurance is part of living a responsible life and it is part the process of buying a house. Having adequate minimum coverage is required as part of any standard mortgage program whether it is a conventional loan through the FHA, USDA or otherwise.  Insurance is a required component of the transaction.  It is there to protect you, your family and the lending entities’ investment.  During the process of buying your first home, you will unfortunately learn that no two home sites are equal and so depending on where you live, your homeowner insurance rates could be significantly different.  Furthermore, most of the data that determines your rates are based on factors out of your control – such as weather conditions.  These factors  greatly affect the premiums you pay. Therefore, no matter where you live whether it is Asheville, North Carolina, or anywhere else, it should be an imperative to obtain the best homeowner insurance that will meet  your needs.  You should always seek competitive quotes from multiple insurance companies, which will help you verify that you’re receiving the best coverage at the best price.

Regional homeowner insurance rates

I think it is interesting that rates change based on what zip and area code you choose to reside in.  According to the National Association of Insurance Commissioners (NAIC), the Gulf Coast states pay the most for their homeowner insurance. Throughout the country, the national average was $804 for annual homeowner insurance premiums. Where you live, environmental factors and other issues such as property value can affect how much you will be expected to pay each year in homeowner insurance premiums.

It is part of our commitment at Asheville 4 Seasons Blog to provide you with interesting if not conversational information with regard to Home Ownership.  We are hoping that the below falls into that category… I mean it is about insurance.  However that being said, below is a list of  how our area and yours compare within the United States:

West

The Western portion of the United States has an extremely varied range of insurance premiums. California has the highest insurance rates in the area by far – the seventh highest in the nation, in fact – but this is largely due to environmental issues like earthquakes, floods and fires, as well as cost of living.

  • Alaska: Ranks 15th at $850
  • Arizona: Ranks 38th at $640
  • California: Ranks 7th at $937
  • Colorado: Ranks 16th at $813
  • Hawaii: Ranks 20th at $776
  • Idaho: Ranks 49th at $477
  • Montana: Ranks 32nd at $666
  • Nevada: ranks 29th at $693
  • New Mexico: 39th at $638
  • North Dakota: Ranks 21st at $742
  • Oregon: Ranks 46th at $502
  • South Dakota: Ranks 41st at $628
  • Utah: Ranks 47th at $494
  • Washington: Ranks 42nd at $603
  • Wyoming: Ranks 36th at $648

Midwest

Depending on where you live in the Midwest, your insurance premiums could be above the national average. According to the NAIC figures, those states that are particularly at risk for tornadoes have slightly higher insurance premiums. But the relatively affordable cost of living in this area of the country can also assist in keeping premiums lower.

  • Illinois: Ranks 30th at $674
  • Indiana: Ranks 39th 638
  • Iowa: Ranks 43rd at $596
  • Kansas: Ranks 13th at $866
  • Michigan: Ranks 24th at $715
  • Minnesota: Ranks 18th at $788
  • Missouri: Ranks 25th at $707
  • Nebraska: Ranks 19th at $783
  • Ohio: Ranks 45th at $530
  • Oklahoma: Ranks 4th at $1,018
  • Wisconsin: Ranks 48th at $490

East

The East coast has a very diverse sampling of homeowner insurance premium ranges, likely because the area features extremely costly metropolitan areas as well as coastal areas that are susceptible to hurricanes.

  • Connecticut: Ranks 11th at $878
  • Delaware: Ranks 45th at $530
  • Maine: Ranks 44th at $573
  • Massachusetts: Ranks 8th at $925
  • New Hampshire: Ranks 31st at $669
  • New Jersey: Ranks 22nd at $726
  • New York: Ranks 12th at $869
  • Pennsylvania: Ranks 37th at $643
  • Rhode Island: Ranks 9th at $919
  • Vermont: Ranks 29th at $677
  • West Virginia: Ranks 34th at $650

South

The South is likely the most expensive place to insure a home in the United States, and these figures are largely due to the costs associated with Hurricane Katrina and similar natural disasters. Residents in these states, particularly, must be vigilant in obtaining multiple homeowner insurance rate quotes.

  • Alabama: Ranks 10th at $894
  • Arkansas: Ranks 17th at $802
  • Florida: ranks 2nd at $1,386
  • Georgia: Ranks 27th at $703
  • Kentucky: Ranks 40th at $637
  • Louisiana: Ranks 3rd at $1,257
  • Maryland: Ranks 23rd at $721
  • Mississippi: Ranks 6th at $998
  • North Carolina: Ranks 35th at $649
  • South Carolina; Ranks 14th at $851
  • Tennessee: Ranks 26th at $706
  • Texas: Ranks 1st at $1,409
  • Virginia: Ranks 33rd at $662

What do we get from all this information…the comforting thought that least we aren’t in Texas! Stay tuned for more information on insurance and the basic types that are available for homeowners.  Hope you have a great week!

A4SR

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Posted in Asheville, Condominiums, First Time Buyers, Homeowners Insurance, North Carolina, Uncategorized | No Comments »


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Asheville, NC 28806
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