Whether you are shopping for home insurance for the first time or have done this before, there are always questions. Am I getting a fair rate? Is this coverage sufficient? While some of these questions should be discussed with your Maryland home insurance agent, a few of them we’ll be happy to answer in this post.
What are home insurance rates based on?
In most cases, home insurance rates are primarily based on the replacement cost of a home, which may not always line up with the market value. Market value is affected by such factors as the type of neighborhood and the location of the house, while replacement cost is just the cost of materials and labor needed to rebuild the home. Over time, the home’s market value may decrease, while its replacement costs may grow due to inflation or rising labor costs. It’s a good idea to re-evaluate the replacement cost of your home every once in a while, especially if you’ve recently completed home improvements.
Does age play any role in determining home insurance rates?
Age plays a role no matter what type of insurance we are talking about. Typically, insurance companies tie age to experience—home ownership experience in this case. Someone who has owned a home before or at least rented a residence for a long time is probably familiar with the basics of home maintenance. They would know to buy a sump pump for their basement or replace a leaky roof. This may not always be the case, but statistics show that mature homeowners have fewer and less costly claims.
What can I do to lower rates without sacrificing coverage?
First of all, you should call your Maryland home insurance agent and have him or her shop around for you. Simply getting quotes from multiple insurance companies can help you find a better rate. To lower it even more, consider the following home improvements:
- New wiring, piping or a full-house renovation
- Home security system or a whole-house “smart home” system
- Smoke alarms, gas leak detectors, sprinkler systems, etc.
You can also save by bundling your home insurance with other policies, such as auto or motorcycle. Additional savings may be available for non-smokers, people 55 and older and homes in a HOA community.
Should I notify my insurance company after a home remodel?
If you are planning a major home renovation, such as building an addition, it may be a good idea to consult with your insurance agent first to see if you have sufficient coverage in the meantime. Renovation means increased risk of slips, falls and injuries, so you want to make sure you are protected from any liabilities. For smaller renovations, report them when you’ve done enough to increase the value of your home. For example, adding a new bathroom is a big expense and you want to make sure the replacement cost will be covered if something does happen.
Am I covered if my dog bites someone?
Most home insurance policies indeed offer “dog bite liability coverage.” In fact, dog-related injuries accounted for about 1/3 of all homeowners’ insurance liability claims in 2014. However, it does matter what kind of dog you own. Some dog breeds like pit bulls are deemed dangerous and may limit your coverage or increase your rates. If you have recently bought a new dog or don’t own a dog anymore, it’s worth checking with your agent to see if your coverage needs to be adjusted.
Is my pool covered?
Pools are typically covered under a home insurance policy, but you should double check with your insurance provider. In-ground pools are typically considered a part of the property and are counted toward the replacement cost. Above-ground pools and hot tubs are often considered personal property and may affect your personal property limit. Either way, if you are adding a pool, you should consider reviewing your liability coverage, as you will be liable for anyone who uses it.
Have other questions? Feel free to give us a call or contact us online and we’ll be happy to offer professional advice.