Frequently Asked Questions
Would you be able to remember all the possessions you have accumulated over the years if they were destroyed by a fire? Having an up-to-date home inventory will help you get your insurance claim settled faster, verify losses for your income tax return and help you purchase the correct amount of insurance.
Start by making a list of possessions, describing each item and noting where you bought it, its make and model. Clip to your list any sales receipts, purchase contracts and appraisals you have. For clothing, count the items you own by category—pants, coats, shoes, for example—making notes about those that are especially valuable. For major appliance and electronic equipment, record their serial numbers usually found on the back or bottom. A website that can assist this process is www.knowyourstuff.org.
1. Don’t be put off
If you are just setting up a household, starting an inventory list can be relatively simple. I you have been living in the same house for many years, however, the task of creating a list can be daunting. Still, it is better to have an incomplete inventory than nothing at all. Start with recent purchases and then try to remember what you can about the older possessions.
2. Big ticket items
Valuable items like jewelry, art work and collectibles may have increased in value since you received them. Value the items and then check with your agent to make sure you have adequate insurance for these items. They may need to be insured separately.
3. Take a picture
Besides the list, you can take pictures of rooms and important individual items. On the back of the photos, note what is shown and where you bought it or the make. Don’t forget things that are in closets and drawers.
4. Use a personal computer
Use your PC to make your inventory list. You can use any software you desire or
go to www.knowyourstuff.org to download a free program designed assist you in inventorying you contents.
5. Storing the list, photos and tapes
Regardless of how you do it (written list, floppy disk, CD, DVD, photos, tape), keep your inventory along with receipts in your safety deposit box or at a friend’s or relative’s home. That way you will be sure to have something to give your insurance representative if your home is damaged. When you make a significant purchase, add the information to your inventory while the details are fresh in your mind.
Start by making a list of possessions, describing each item and noting where you bought it, its make and model. Clip to your list any sales receipts, purchase contracts and appraisals you have. For clothing, count the items you own by category—pants, coats, shoes, for example—making notes about those that are especially valuable. For major appliance and electronic equipment, record their serial numbers usually found on the back or bottom. A website that can assist this process is www.knowyourstuff.org.
1. Don’t be put off
If you are just setting up a household, starting an inventory list can be relatively simple. I you have been living in the same house for many years, however, the task of creating a list can be daunting. Still, it is better to have an incomplete inventory than nothing at all. Start with recent purchases and then try to remember what you can about the older possessions.
2. Big ticket items
Valuable items like jewelry, art work and collectibles may have increased in value since you received them. Value the items and then check with your agent to make sure you have adequate insurance for these items. They may need to be insured separately.
3. Take a picture
Besides the list, you can take pictures of rooms and important individual items. On the back of the photos, note what is shown and where you bought it or the make. Don’t forget things that are in closets and drawers.
4. Use a personal computer
Use your PC to make your inventory list. You can use any software you desire or
go to www.knowyourstuff.org to download a free program designed assist you in inventorying you contents.
5. Storing the list, photos and tapes
Regardless of how you do it (written list, floppy disk, CD, DVD, photos, tape), keep your inventory along with receipts in your safety deposit box or at a friend’s or relative’s home. That way you will be sure to have something to give your insurance representative if your home is damaged. When you make a significant purchase, add the information to your inventory while the details are fresh in your mind.
Homeowners insurance provides financial protection against disasters. A standard policy insures the home itself and the things you keep in it.
Homeowners insurance is a package policy. This means that it covers both damage to your property and your liability or legal responsibility for any injuries and property damage you or members of your family cause to other people not involving a vehicle. This normally includes damage caused by household pets.
Loss caused by theft is normally included with certain limitations on such items as jewelry, cash, valuable papers and several other items. If you feel you may have any items that could be limited or excluded please mention it to one of our licensed representatives when arranging your coverage.
Damage caused by most disasters is covered but there are exceptions. The most significant are damage caused by floods, windstorm in the counties closest to the Gulf of Mexico and poor maintenance. You must buy an additional policy for windstorm coverage if your property is located in a county closest to the Gulf of Mexico. Maintenance-related problems are the homeowners’ responsibility.
Flood Insurance is a federal government program and can be purchased thru FireMark Insurance Agency. Even if you are not in a high risk area, we recommend the purchase of this coverage.
Homeowners insurance is a package policy. This means that it covers both damage to your property and your liability or legal responsibility for any injuries and property damage you or members of your family cause to other people not involving a vehicle. This normally includes damage caused by household pets.
Loss caused by theft is normally included with certain limitations on such items as jewelry, cash, valuable papers and several other items. If you feel you may have any items that could be limited or excluded please mention it to one of our licensed representatives when arranging your coverage.
Damage caused by most disasters is covered but there are exceptions. The most significant are damage caused by floods, windstorm in the counties closest to the Gulf of Mexico and poor maintenance. You must buy an additional policy for windstorm coverage if your property is located in a county closest to the Gulf of Mexico. Maintenance-related problems are the homeowners’ responsibility.
Flood Insurance is a federal government program and can be purchased thru FireMark Insurance Agency. Even if you are not in a high risk area, we recommend the purchase of this coverage.
A standard homeowners insurance policy includes four essential types of coverage. They include:
1. Coverage for the structure of your home.
2. Coverage for your personal belongings.
3. Liability protection.
4. Additional living expenses in the event you are temporarily unable to live in your home because of a fire or other insured covered cause of loss.
The structure of your house.
This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, wind, hail, lightning or other insured disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.
Most standard policies also cover structures that are detached from your home such as a garage, tool shed, gazebo or fences. Generally, these structures are covered for about 10% of the amount of insurance you have on your home. If you need more coverage, talk to our representative about purchasing more insurance.
Your personal belongings.
Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, wind or other insured disaster. Most companies provide contents coverage for 40% to 60% of the amount of insurance you have on your home. If your have $100,000 worth of insurance on the structure of your home, you would have between $40,000 to $60,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to do a home inventory.
This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world. Most companies limit the amount to 10% of the amount of insurance you have for your belongings. You have up to $500 of coverage for cash and unauthorized use of your credit cards.
Expensive items like jewelry and furs are covered, but there are dollar limits if they are stolen. Generally, you are covered up to $500. For an additional premium, this limit can be increased to $5,000. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it’s appraised value. Coverage includes “accidental disappearance,” meaning coverage if you simply lose that item without a deductible.
Trees, plants and shrubs are also covered under the standard homeowners insurance. Generally, you are limited to a total of 5% of the insurance on your home and $250 per item. Coverage is provided for theft, fire, lightning, vandalism and even falling aircraft. They are not covered for damage caused by wind or disease.
Liability protection
Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. So, if your child accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.
The liability portion of your policy pays for both the cost of defending you and any court awards—up to the limit of your policy with world wide coverage.
While you can purchase lower limits, we recommend that you purchase at least $300,000
worth of protection. Many of our clients feel more comfortable with even more coverage. You can purchase an umbrella liability policy which provides broader coverage, including claims against you for libel and slander. The premiums for a umbrella liability policy are surprisingly inexpensive.
Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured on your premises, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.
Additional living expense
This pays the additional costs of living away from home if you cannot live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expense, within reason, while your home is being rebuilt. This coverage is normally limited to 20% of the amount of insurance you carry on the home structure.
1. Coverage for the structure of your home.
2. Coverage for your personal belongings.
3. Liability protection.
4. Additional living expenses in the event you are temporarily unable to live in your home because of a fire or other insured covered cause of loss.
The structure of your house.
This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, wind, hail, lightning or other insured disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.
Most standard policies also cover structures that are detached from your home such as a garage, tool shed, gazebo or fences. Generally, these structures are covered for about 10% of the amount of insurance you have on your home. If you need more coverage, talk to our representative about purchasing more insurance.
Your personal belongings.
Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, wind or other insured disaster. Most companies provide contents coverage for 40% to 60% of the amount of insurance you have on your home. If your have $100,000 worth of insurance on the structure of your home, you would have between $40,000 to $60,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to do a home inventory.
This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world. Most companies limit the amount to 10% of the amount of insurance you have for your belongings. You have up to $500 of coverage for cash and unauthorized use of your credit cards.
Expensive items like jewelry and furs are covered, but there are dollar limits if they are stolen. Generally, you are covered up to $500. For an additional premium, this limit can be increased to $5,000. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it’s appraised value. Coverage includes “accidental disappearance,” meaning coverage if you simply lose that item without a deductible.
Trees, plants and shrubs are also covered under the standard homeowners insurance. Generally, you are limited to a total of 5% of the insurance on your home and $250 per item. Coverage is provided for theft, fire, lightning, vandalism and even falling aircraft. They are not covered for damage caused by wind or disease.
Liability protection
Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. So, if your child accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.
The liability portion of your policy pays for both the cost of defending you and any court awards—up to the limit of your policy with world wide coverage.
While you can purchase lower limits, we recommend that you purchase at least $300,000
worth of protection. Many of our clients feel more comfortable with even more coverage. You can purchase an umbrella liability policy which provides broader coverage, including claims against you for libel and slander. The premiums for a umbrella liability policy are surprisingly inexpensive.
Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured on your premises, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.
Additional living expense
This pays the additional costs of living away from home if you cannot live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expense, within reason, while your home is being rebuilt. This coverage is normally limited to 20% of the amount of insurance you carry on the home structure.
Texas has changed its position on homeowner policies over the past few years. Currently each company has the right to file their own unique form with the Texas Department of Insurance. While many of the policies are similar in protection and cost, it is important to know which policy best fits your needs and budget.
It is our recommendation that you deal with an Independent Insurance Agent that represents numerous companies so they can compare the type of coverage that best fits your lifestyle at a premium you can afford. FireMark is an Independent Insurance Agent representing many quality companies with a staff of licensed representatives to assist you in the selection of your coverage.
Coverages that you will want to compare are:
* Policy Form
* Actual Cash Value vs. Replacement Cost on both building and contents.
* Water Damage
* Ordinance and Law endorsement
It is our recommendation that you deal with an Independent Insurance Agent that represents numerous companies so they can compare the type of coverage that best fits your lifestyle at a premium you can afford. FireMark is an Independent Insurance Agent representing many quality companies with a staff of licensed representatives to assist you in the selection of your coverage.
Coverages that you will want to compare are:
* Policy Form
* Actual Cash Value vs. Replacement Cost on both building and contents.
* Water Damage
* Ordinance and Law endorsement
Unlike driving a car, you can legally own a home without homeowners insurance. But, if you have bought your home and financed the purchase with a mortgage, your lender will likely require you to get homeowners insurance coverage. That is because lenders need to protect their investment in your home in case your house burns down or is badly damaged by a storm, wind or other insured disaster. If you live in an area that is likely to flood your lender will also require you to purchase flood insurance.
You need enough insurance to cover the following:
* 1.The structure of your home but not less than you mortgage.
* 2.Your personal possessions
* 3.The cost of additional living expenses if your home is damaged and your have to live elsewhere during repairs.
* 4.Your liability to others
The structure
You need enough insurance to cover the cost of rebuilding your home at current construction costs. Do not include the cost of the land and do not base your rebuilding costs on the price you paid for your home. The cost of rebuilding could be more than the price you paid or you could sell it today.
Most lenders require you to by homeowners insurance to cover the amount of your mortgage. If the limit of your insurance policy is based on your mortgage make sure it is enough to cover the cost of rebuilding. (If you pay off your mortgage do not, cancel your homeowners policy. Homeowners insurance protects your investment in your home.)
The responsibility for determining the correct coverage to carry on your home ultimately falls on the homeowner. Factors that will influence the cost of rebuilding your home are:
* Local construction costs
* The square footage of the structure
* The type of exterior wall construction – frame, masonry (brick or stone) or veneer
* The style of the house (ranch, colonial)
* The number of bathrooms and other rooms
* The type of roof and materials used
* Other structures on the premises such as garages, sheds, gazebos
* Fireplaces, exterior trim and other special features like arched windows
* Whether the house, or parts of it like the kitchen, was custom built
* Improvement to your home—adding an additional bathroom, enlarging the kitchen or other additions that have added value to your home
Standard homeowners policies provide coverage for insured losses such as damage due to fire, lighting, hail, explosions, theft, vandalism and wind. They do not cover floods, earthquakes or damage due to lack of routine maintenance. Flood Insurance is available from FireMark Insurance Agency.
Replacement cost policies
Most policies cover replacement cost for damage to the structure. A replacement cost policy pays for the repair or replacement of damaged property with materials of similar kind and quality. There is no deduction for depreciation.
If you purchase a flood insurance policy, coverage for the structure is available on a replacement cost basis only if the home is owner occupied.
Building codes
Building codes are updated periodically and may have changed significantly since your home was built. If your home is badly damaged, you may be required to rebuild your home to meet new building codes. Unless endorsed, generally, homeowners policies will not pay for the extra cost of rebuilding to the new code. (An endorsement is a form attached to an insurance policy that changes what the policy covers.)
Your personal possessions
Most homeowners insurance policies provide coverage for your personal possessions for 40% to 60% of the amount of insurance you have on your home. The limits of the policy appear on the Declarations Page under Section 1, Coverage, A, Dwelling.
To determine if this enough coverage, you need to do a home inventory. This is a detailed list of everything you own and information related to the cost to replace these items if they were destroyed by an insured event. (For more information see How do I take a home inventory and why?) If you think you need more coverage, contact FireMark Insurance Agency and ask to discuss higher limits for your personal possessions.
Insuring expensive items with floaters/endorsements
There may be limits on how much coverage you get for expensive items such as jewelry or furs. This limit normally is $500 but can be increased to $5,000.
If the limits are too low, consider buying a special personal property floater or an endorsement. These allow you to insure these items individually or as a collection. With floaters or endorsements, there is no deductible. You are charged a premium based on what the item is, its dollar value and where you live.
Additional living expense
This pays the additional costs of living away from home if you cannot live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expense, within reason, while your home is being rebuilt. This coverage is normally limited to 20% of the amount of insurance you carry on the home structure.
Liability protection
Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. So, if your child accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.
The liability portion of your policy pays for both the cost of defending you and any court awards—up to the limit of your policy with world wide coverage.
While you can purchase lower limits, we recommend that you purchase at least $300,000
worth of protection. Many of our clients feel more comfortable with even more coverage. You can purchase an umbrella liability policy which provides broader coverage, including claims against you for libel and slander. The premiums for a umbrella liability policy are surprisingly inexpensive.
Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured on your premises, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.
* 1.The structure of your home but not less than you mortgage.
* 2.Your personal possessions
* 3.The cost of additional living expenses if your home is damaged and your have to live elsewhere during repairs.
* 4.Your liability to others
The structure
You need enough insurance to cover the cost of rebuilding your home at current construction costs. Do not include the cost of the land and do not base your rebuilding costs on the price you paid for your home. The cost of rebuilding could be more than the price you paid or you could sell it today.
Most lenders require you to by homeowners insurance to cover the amount of your mortgage. If the limit of your insurance policy is based on your mortgage make sure it is enough to cover the cost of rebuilding. (If you pay off your mortgage do not, cancel your homeowners policy. Homeowners insurance protects your investment in your home.)
The responsibility for determining the correct coverage to carry on your home ultimately falls on the homeowner. Factors that will influence the cost of rebuilding your home are:
* Local construction costs
* The square footage of the structure
* The type of exterior wall construction – frame, masonry (brick or stone) or veneer
* The style of the house (ranch, colonial)
* The number of bathrooms and other rooms
* The type of roof and materials used
* Other structures on the premises such as garages, sheds, gazebos
* Fireplaces, exterior trim and other special features like arched windows
* Whether the house, or parts of it like the kitchen, was custom built
* Improvement to your home—adding an additional bathroom, enlarging the kitchen or other additions that have added value to your home
Standard homeowners policies provide coverage for insured losses such as damage due to fire, lighting, hail, explosions, theft, vandalism and wind. They do not cover floods, earthquakes or damage due to lack of routine maintenance. Flood Insurance is available from FireMark Insurance Agency.
Replacement cost policies
Most policies cover replacement cost for damage to the structure. A replacement cost policy pays for the repair or replacement of damaged property with materials of similar kind and quality. There is no deduction for depreciation.
If you purchase a flood insurance policy, coverage for the structure is available on a replacement cost basis only if the home is owner occupied.
Building codes
Building codes are updated periodically and may have changed significantly since your home was built. If your home is badly damaged, you may be required to rebuild your home to meet new building codes. Unless endorsed, generally, homeowners policies will not pay for the extra cost of rebuilding to the new code. (An endorsement is a form attached to an insurance policy that changes what the policy covers.)
Your personal possessions
Most homeowners insurance policies provide coverage for your personal possessions for 40% to 60% of the amount of insurance you have on your home. The limits of the policy appear on the Declarations Page under Section 1, Coverage, A, Dwelling.
To determine if this enough coverage, you need to do a home inventory. This is a detailed list of everything you own and information related to the cost to replace these items if they were destroyed by an insured event. (For more information see How do I take a home inventory and why?) If you think you need more coverage, contact FireMark Insurance Agency and ask to discuss higher limits for your personal possessions.
Insuring expensive items with floaters/endorsements
There may be limits on how much coverage you get for expensive items such as jewelry or furs. This limit normally is $500 but can be increased to $5,000.
If the limits are too low, consider buying a special personal property floater or an endorsement. These allow you to insure these items individually or as a collection. With floaters or endorsements, there is no deductible. You are charged a premium based on what the item is, its dollar value and where you live.
Additional living expense
This pays the additional costs of living away from home if you cannot live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expense, within reason, while your home is being rebuilt. This coverage is normally limited to 20% of the amount of insurance you carry on the home structure.
Liability protection
Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. So, if your child accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.
The liability portion of your policy pays for both the cost of defending you and any court awards—up to the limit of your policy with world wide coverage.
While you can purchase lower limits, we recommend that you purchase at least $300,000
worth of protection. Many of our clients feel more comfortable with even more coverage. You can purchase an umbrella liability policy which provides broader coverage, including claims against you for libel and slander. The premiums for a umbrella liability policy are surprisingly inexpensive.
Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured on your premises, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.
The price you pay for your homeowners insurance can vary by hundreds of dollars depending on the size of your house and the insurance coverage you buy. Do not make your decision on price alone. You want an agent and agency that represents numerous markets and will shop for you based on your needs and budget. You want someone that answers your questions and handles claims fairly and efficiently. Select an agent that takes the time to answer your questions and returns your calls.
Here are some ways or save money:
Raise you deductibles
A deductible is the amount of money you have to pay toward a loss before your insurance company starts to pay a claim. The higher your deductible the more money you save on your premium. We normally recommend a deductible of 1% of the insured value of your home.
If you live in a disaster-prone area, your insurance policy may have a separate deductible for major disasters. If you live near the coast you will have a separate windstorm deductible.
Buy your home and auto policies from the same insurer if you qualify
Most companies that sell homeowners insurance also sell auto insurance. Some insurance companies will reduce your premium if you buy tow insurance policies from them. But make certain this combined price is lower than buying the coverage from separate companies. An Independent Agent will make this comparison for you.
Do not confuse what you paid for your house with rebuilding costs
The land under your house is not at risk from theft, windstorm, fire and the other perils covered in your homeowners policy. So don’t include its value in deciding how much to homeowners insurance to buy. If you have a mortgage the lender may not give you this option.
Ask about discounts for home security devices
You can usually get discounts of at least 5 percent to 20 percent if you install a security system. The more sophisticated the system the greater the savings on your homeowners insurance. Before installing the system ask your agent about the discounts available from their insurance carriers.
Here are some ways or save money:
Raise you deductibles
A deductible is the amount of money you have to pay toward a loss before your insurance company starts to pay a claim. The higher your deductible the more money you save on your premium. We normally recommend a deductible of 1% of the insured value of your home.
If you live in a disaster-prone area, your insurance policy may have a separate deductible for major disasters. If you live near the coast you will have a separate windstorm deductible.
Buy your home and auto policies from the same insurer if you qualify
Most companies that sell homeowners insurance also sell auto insurance. Some insurance companies will reduce your premium if you buy tow insurance policies from them. But make certain this combined price is lower than buying the coverage from separate companies. An Independent Agent will make this comparison for you.
Do not confuse what you paid for your house with rebuilding costs
The land under your house is not at risk from theft, windstorm, fire and the other perils covered in your homeowners policy. So don’t include its value in deciding how much to homeowners insurance to buy. If you have a mortgage the lender may not give you this option.
Ask about discounts for home security devices
You can usually get discounts of at least 5 percent to 20 percent if you install a security system. The more sophisticated the system the greater the savings on your homeowners insurance. Before installing the system ask your agent about the discounts available from their insurance carriers.
If you are ever sued, your standard homeowners or auto policy will provide you with some liability coverage, paying for judgments against you and your attorney’s fees, up to a limit set in the policy. However, in our litigious society, you may want have an extra layer of liability protection. That’s what a personal umbrella liability policy provides.
An umbrella policy provides coverage when you reach the limit on the underlying liability coverage in a homeowners, auto or boat policy. The premium for an umbrella is surprisingly reasonable.
Because the personal umbrella policy goes into effect after the underlying coverage is exhausted, there are certain limits that usually must be met in order to purchase this coverage. Most insurers will want to have about $250,000 of liability on your auto policy and $500,000 on your homeowners policy before selling you an umbrella policy for a $1,000,000 or more of additional coverage.
An umbrella policy provides coverage when you reach the limit on the underlying liability coverage in a homeowners, auto or boat policy. The premium for an umbrella is surprisingly reasonable.
Because the personal umbrella policy goes into effect after the underlying coverage is exhausted, there are certain limits that usually must be met in order to purchase this coverage. Most insurers will want to have about $250,000 of liability on your auto policy and $500,000 on your homeowners policy before selling you an umbrella policy for a $1,000,000 or more of additional coverage.