The homeowners insurance market has been greatly impacted by storm activity the last few years. Many insurance companies have made changes to their policies to protect their interest. We have put together a list of key coverages to help educate buyers during the quoting process.
What you want:
What to avoid:
Replacement Cost (RC) Roof
Actual Cash Value (ACV) Roof
Wind and Hail are the #1 claim type in Southern Indiana, which directly impact the coverage on your roof. An ACV policy will depreciate the value of your roof, possibly causing your settlement to payout thousands less than anticipated. RC or Replacement Cost will cover the total cost of replacement, less your deductible.
Flat Deductible for “Wind/Hail”
% Deductible for Wind/Hail
Deductibles on your homeowners insurance can vary, depending on the claim type. The growing trend is for insurance carriers to offer a percentage deductible, based on the coverage value of your dwelling. This can easily increase your deductible and will typically increase year over year due to inflation guards. Always try to get a flat deductible to better manage your out of pocket expenses.
Earthquake Coverage
Not Listed – No Coverage
Evansville, Indiana sets near 2 active fault zones, the Wabash Valley Seismic Zone and the New Madrid Seismic Zone. We are particularly suceptible to Earthquakes due to the soft river soils that transfer the potential energy and affecting our homes. You should have some Earthquake coverage and if you can’t find it in your homeowners declaration pages, then you don’t have coverage.
Financial Strength ‘A’ Rated
Downgraded Carriers
Due diligence when choosing a homeowners policy can take time and effort. A.M. Best is the agency who specializes in rating the financial strengths of over 16,000 carriers. The financial strength rating is directly tied to the carriers ability to payout incase of major catastrophic claims. I recommend going with a carrier that is A rated or higher.
Regardless of where you decide to place your insurance business, I want you to understand what you are purchasing. The time to find out is not after a catastrophic claim!