Leave Your Home Vacant? You Could Lose Insurance Coverage

Do the geese flying south have you thinking of closing up your house and spending the winter in a warmer climate? Before you pack your swimsuit and sandals, take note: If you leave your house empty for too long, you could lose your home owners insurance — and your home equity if a fire or other disaster destroys or damages your house.

Insurance companies hate vacant houses, whether you’re taking a extended vacation or you’re moving out of town and leaving your house empty. If you’re not home and a water pipe busts, a fire starts, or someone breaks in, chances are the subsequent mess is going to be pretty big — along with the insurance claim for the damage.

If you’re lucky, your insurance company will let you leave the house vacant, but just won’t pay for certain things like broken glass, vandalism, or malicious mischief. At worst, your home owners insurance company will yank your policy if you go away and leave the house unattended for a month or more.

Some companies, like State Farm, decide on a case-by-case basis whether you can keep your policy when you’re temporarily not living in your home, especially if you’ve got a plan to take care of the place while you’re out of town.

Say you’re going on a two-month, around-the-world cruise (lucky you!). You’re more likely to keep your coverage if you hire a company to shovel the snow so your home looks occupied while you’re gone.

Some insurers will cancel your policy if your house is vacant for 30 days. If that happens to you, call a commercial insurance broker. Commercial agents sell insurance to landlords who have vacant houses all the time — during renovations, or when they’re between tenants.

Expect to pay about 15% to 20% more than you were paying for your regular home owners insurance.

The bottom line is that if you’re heading south for the winter, read the fine print in your home owners policy to see what it says about vacancies. Then, email your agent or insurance company to double-check the rules. Don’t call, because an email is a written record of your communication. You might need that record later if the company refuses to pay a claim because your house was vacant.

Have you left your house vacant for more than a month? Did you check your home owners insurance policy before you left?

Read more: http://www.houselogic.com/blog/home-insurance/vacant-house-insurance/#ixzz1a1kCq7uq

Create a Home Inventory for Insurance

Create a home inventory before disaster strikes to make filing an insurance claim a smoother process.


Experiencing a theft, flood, fire, or other casualty loss is devastating enough. Now imagine trying to list from memory for your insurance claim every single item that was damaged or destroyed. The task becomes less daunting if you create a home inventory in advance and keep it in a safe place.

Creating a home inventory can be done with pencil and paper alone, but a digital camera and camcorder make the job easier. Set aside enough time to review your insurance policies, dig up receipts, document your possessions, and figure out where you’ll store your records. One day should be sufficient.

A home inventory is essential

From appliances, plates, and glasses to collectibles, rugs, and furniture, the average home is packed with an array of items collected over the years. And while you may be able to list many of them in a pinch, chances are you’d miss some important possessions if you ever needed to reconstruct your home’s contents from memory, says Mark Goldwich, founder of GoldStar Adjusters, a Jacksonville, Fla., claims adjusting firm.

“Home inventories are a must no matter what the value of the home’s items are,” says Goldwich. “If you’re going to insure your property and pay for that insurance, you really should be able to document the ownership and the value of the items that you’re insuring. If you don’t have proof of the items you owned, it makes filing your claim much more difficult.”

Your job doesn’t end once you’ve compiled a home inventory, a detailed list of everything in your household. Be sure to compare estimated values to your policy’s coverage to ensure that you’ll be able to replace your belongings in case of damage or theft, says Goldwich, who is the author of “Uncovered: What Really Happens After the Storm, Flood, Earthquake or Fire.” In some cases, he says, you can purchase additional coverage if the value of your possessions exceeds the limits on your homeowners, flood, or other disaster policy.

Take photos and video of possessions

Jack Hungelmann, author of “Insurance for Dummies,” says a picture can be worth more than just a thousand words—it can add up to thousands in cash if you ever need to file an insurance claim. Hungelmann recommends using a digital camcorder or camera to take pictures of each room to document your belongings. “I recommend that people open up their cupboards and drawers. Be sure you have a record of all the things you own,” he says.

Goldwich says that creating such a home inventory might seem daunting, but digital video—you can pick up a decent camcorder for about $150—can make the task much easier.

Homeowners can literally walk from room to room and record narrative descriptions of items. You should note whether something is an antique, for example, or if it has other qualities that make it especially valuable such as the size of a television screen or the type of stones in a piece of jewelry. Get close-up shots of serial numbers on electronics, power tools, and the like.

Filling in a printed checklist with serial numbers, brands, quantities, and estimated values will prove indispensible if an insurance claim ever needs to be filed. The adjuster will likely ask for such a list, and you can use the video or photos as proof of ownership. Download our free home inventory checklist to create your own.

Keep your home inventory safe

Of course, such documentation is useless if it’s destroyed in a natural disaster, consumed by fire, or stolen along with your personal computer. Hungelmann says that using digital media allows you to store the files on online backup services like Carbonite.com or iBackup.com in case your home is destroyed.

If you’d like to save the $10 or more per month these services typically cost, you could also save the files on a USB drive that’s kept in a safe-deposit box, at a relative’s home, or in your emergency bag. The bag should include essentials your family needs in case you’re forced to flee on short notice.

It’s also a good idea to keep a file with receipts and any appraisals of valuable items you own. Store these documents off-site as well. Goldwich says that the more documentation you have to prove what you owned and what it was worth, the easier the claims process will be.

Gwen Moran has been writing about business, finance, and real estate for more than a decade. Her work has been published by Cyberhomes.com, Entrepreneur, Financial Planning, Newsweek.com, On Wall Street, The Residential Specialist, and many others.


Read more: http://www.houselogic.com/articles/create-home-inventory-insurance/#ixzz1SqaLJqBx

Four Types of Insurance You MUST Have At All Times

Today, I was reading an article in USA Today about homeowners that lost a court case contesting the policy language of their homeowner’s policy about storm surge/flood waters regarding the devastation from Hurricane Katrina. The judge upheld the ruling that the policy language is clear about not covering damages caused by storm surge or flood waters whether it is caused by actual flooding or wind. Obviously, none of these people had flood insurance, because they believed they would never need it. It’s a tragic story, because now we’ll definitely be seeing the true fallout of the Katrina damages when foreclosures and bankrupties sky-rocket in New Orleans. I am a property claims adjuster, so this article was very interesting to me, and it got me thinking about what types of insurance all adults should have no matter what phase of their lives they are in. Here are my top four types of insurance that every human being should buy in order to maintain financial stability.

1. Auto Insurance: This one is obvious because it is illegal to drive in the U.S. without some form of auto insurance. My suggestions on auto insurance if you are looking to save some money is to do your homework and go to an independent agent whom can shop different companies to find you the best rate. Save money on the premium by opting for a higher deductible or cutting out collision coverage if your car is more than 7 years old. DO NOT, I repeat DO NOT go cheap on the liability portion of auto coverage. If you cause an accident and someone becomes paralyzed for your negligence, an attorney will take you to the cleaners without proper liability insurance.
2. Health Insurance: There are plenty of people between the ages of 18 – 30 whom do not have health insurance. I was one of them. In college I did not have any health insurance, I had major accident insurance, but not a standard health policy. Luckily, the worst ailments I ever had in college was influenza. Look, I know it is expensive, but you gotta have it. One semi-major accident or illness and you will be paying medical bills for the next 10 years. I know that there are plenty of universities that offer a plan that is catered toward students and the premium is reasonable. If your employer offers a health plan in their benefits package, PLEASE sign up for it. Usually they fit the bill for most of the monthly premium.
3. Property Insurance: This coverage applies to renters and homeowners. If you own a home or a condo/townhouse, then you NEED to have a homeowner’s policy. The standard homeowner’s policy is the most bang for your buck in terms of what it covers as an insurance policy. I know that many people think that homeowner’s insurance is lousy (especially if you live in Florida), but it offers quite a bit of coverage. First, it covers your home for everyting unless specifically excluded like flood (see above), it covers your personal property ANYWHERE in the world, and it gives you liability coverage if someone sues you for being liable for something that happened to them. It’s your biggest asset, you NEED to protect it. If you rent, you NEED to have a renter’s policy. It covers your stuff for things like theft, water damage, fire, and lightning. It also has some liability coverage built into it as well. A renter’s policy is literally $10 – 15 per month. Cut out two pizzas per month and you can afford it.
4. Long-term Disability Insurance: This is the one that most people do not think about, and therefore, seldom purchase. This especially goes for younger people, because we like to think we’re invincible. Well, the fact is that accidents happen all the time, and you need to protect yourself if something tragic happens, and you are unable to work any longer. Long-term disability insurance kicks in when you injure yourself and are unable to go back to work for an extended period of time or never. it supplements the income you would have earned. This insurance is rated largely on your occupation, so if you have a desk job, your premium would be really cheap. But if you are in the construction business, your premium would be pretty expensive.

Some of you may say, “Hey Erik, you left out life insurance”. Well, I left out life insurance for the reason that not all people need life insurance in all phases of their lives. A young couple with no childrem whom both work and make comparable salaries or a retired couple with a large nest egg do not necessarily need life insurance policies. Life insurance policies should act to insure that your dependents are taken care of if you die tomorrow. If your wife makes more money than you or you do not have kids/your kids are grown-ups, then paying for life insurance is a waste. The four listed above are all insurances that are indispensible and everyone, no matter what phase of life you are in, should be mindful of owning these four types of insurances.

By: Erik Folgate http://www.moneycrashers.com/four-types-of-insurance-you-must-have-at-all-times/

Insurance Mistakes to Avoid: Don't Risk Being Underinsured

Too many Americans mistakenly believe that the coverage limits of their home owners insurance policy are linked to the market value of their home, according to the Insurance Information Institute.
In the I.I.I.’s 2011 Insurance Pulse Survey, conducted by the Opinion Research Corporation, nearly half (48%) of survey respondents came to that incorrect conclusion.

“The real estate value of a home, that is the price you can buy or sell it for, has absolutely nothing to with the amount of insurance needed to financially protect the home owner in the event of a fire or other disaster,” said Jeanne M. Salvatore, senior vice president and consumer spokesperson for the I.I.I. “Reducing insurance coverage because the market value of a home has decreased can result in being dangerously underinsured.”
One out of three respondents to the Pulse Survey reported that they purchased less home owners or auto insurance as a way to save money. A better strategy would be to take a higher deductible, which can substantially reduce insurance costs. Home and car owners can then put the savings into a purchasing the right amount and type of insurance for their specific needs, pointed out Salvatore.
Another way to save money is to comparison shop, something that seven out of 10 Pulse Survey respondents said they did to save on both their home and auto insurance needs.
I.I. I. says three biggest insurance mistakes home owners can make are:
1. Insuring a home for its real estate value rather than for the cost of rebuilding. When real estate prices go down, some home owners may think they can reduce the amount of insurance on their home. But insurance is designed to cover the cost of rebuilding, not the sales price of the home. You should make sure that you have enough coverage to completely rebuild your home and replace your belongings.

• A better way to save: Raise your deductible. An increase from $500 to $1,000 could save up to 25% on your premium payments.

2. Selecting an insurance company by price alone. It is important to choose a company with competitive prices, but also one that is financially sound and provides good customer service.

• A better way to save: Check the financial health of a company with independent rating agencies and ask friends and family for recommendations. You should select an insurance company that will respond to your needs and handle claims fairly and efficiently.

3. Dropping flood insurance. Damage from flooding is not covered under standard home owners and renters insurance policies. Coverage is available from the National Flood Insurance Program (NFIP), as well as from some private insurance companies. Many home owners are unaware they are at risk for flooding, but in fact 25% of all flood losses occur in low risk areas. Furthermore, with the significant snow fall this winter, spring related flooding may be particularly severe, thus increasing the importance of purchasing flood insurance.

• A better way to save: Before purchasing a home, check with the NFIP to determine whether the property is situated in a flood zone; if so, consider a less risky area. If you are already living in a designated flood zone, look at mitigation efforts that can reduce your risk of flood damage and consider purchasing flood insurance. Additional information on flood insurance can be found at www.FloodSmart.gov.

Source: Insurance Information Institute

Read more: http://www.houselogic.com/news/articles/insurance-mistakes-avoid-dont-risk-being-underinsured/#ixzz1GyKgD7Zt