Property insurance is the kind of insurance that provides protections against certain risks on property like fire, theft or weather damage. This also incorporates socialized insurances like fire insurance, flood insurance, earthquake insurance home insurance or boiler insurance.
But before opting for any kind of insurance, one must keep in mind certain points that explain the best way to look after your property insurance. You must know how it works and your reasons for opting for one.
1) Analyze your need for property insurance – There are many reasons that may call for property insurance. If it’s a fire accident or burglary or vandalism, insurance is the best option to face. You may also need property insurance as you may need to replace, repair or rebuild your home after any accident. Apart from home you may also need to protect your jewelry, silverware, business property, cameras, phones etc.
2)Things to consider carefully – You should first consider the basic need for property insurance. Don’t forget that your need is unique so will your insurance be. Select the scenario whether you are buying a home or you have got a condominium, or you got a mobile home or just might be that you are renting. These all factors have different need and specialized insurances too.
3) Make the right choice – Choosing the right company for property insurance is also very important. One should always keep in mind the reputation, the availability, the service, the product selection and the rates before choosing any company. Choose among the various insurance providers, the right company for you. The company with strong reputation, high standards and financial stability will no doubt be the one that you might ask. Continue reading
Property Insurance is a typical form of home insurance that protects a building from mishaps and also its contents. There are several types of such insurances available today, and when you are purchasing such an insurance product, you should consult an expert insurance agent so that you can confirm that you are actually buying a product that suits your requirements. When you are planning your insurance requirements, you should be unambiguous in your thoughts about the insurance type that you are looking for and the coverage requirement.
Property insurance is one such kind or insurance that would provide you protection against some major risks on your property, such as theft, weather damage, natural calamities and fire. This would also incorporate socialized insurances, such as flood insurance, fire insurance, insurance against earthquake, boiler insurance or the typical home insurances.
There are some open peril insurance policies in which any type of damage that is not excluded specifically in property insurance is also covered. Names as peril policies, these coverage schemes actually spell out the list of all the potential causes of home damage that are covered. Property insurance specializes in many cases of damage caused to properties and will also contain well stated exclusions. The exclusions would vary depending on the type of policy chosen.
Property owners usually prefer to purchase a insurance that allows them to restore the structure of the building in case of some unforeseen events, such as earthquake, fire, flood and similar other catastrophes. Such types of property insurances would specifically exclude the building contents, or it might as well exclude some types of the contents. For instance, fixtures are usually covered, but when movable property is concerned, it might not be covered.
This insurance is not just meant for property owners, but for tenants too. Industrial as well as commercial tenants can purchase these insurance schemes so that in an event that the inventories or property is damages, they can seek replacement help. As a business tends to have quite a large amount of capital invested in the equipment and inventory, such losses can actually be calamitous without insurance for coverage. The residential renters may benefit from such property insurance schemes, although most of these are uninsured. Renters are often times flabbergasted without a policy to cover such instances.
Before purchasing property insurance, tenants should always ask the landlords about the type of policies on a property, and what it covers under the policies. It is simply unnecessary to over insure a property or its contents, and landlords may even have some suggestion for the insurance companies and agencies for tenant.
There are many people who would like to obtain the liability insurance for their property. Property causality insurance policies are also quite lucrative and it protects people against legal damages that results from some damage or injuries caused on the property. As a matter of fact, there are a lot of options to try out. However, you will have to be very careful while you are making a choice.
Any property can become empty at any time under many different circumstances. When a property is unoccupied a standard house insurance policy will only usually provide cover for up to 30 days. This is when one must obtain an empty property insurance policy to keep their asset properly insured against risks such as fire, storm damage, theft etc.
There could be any number of reasons why a property may become vacant. The property could be a recent purchase by a landlord and is undergoing renovation prior to either letting it or selling it on. The property owner may have moved on and their current property has become empty until a new purchaser is found. The property owner could be erecting a new extension and has decided to move out of their property whilst the works are being carried out. What ever the reason it is still crucial to ensure that the empty property is sufficiently insured. If there is a mortgage outstanding on the building then the lender will insist on some form of insurance cover on the premises.
There are specialist insurance companies and brokers in the UK that specifically cater for the needs of a property owner with an empty building. Insurers and brokers that offer unoccupied property insurance quotes will normally have extensive knowledge on this subject and can help with risk management advice. Under an empty property insurance contract, the terms and conditions will differ from those of a standard home insurance policy. Get your advisor to go through with these in detail. There could be conditions on locks, how the water is left and how often the premises need to be visited etc. These conditions will vary from insurer to insurer.
Normally a property may be empty for 3 to 6 month but in certain scenarios it could be vacant for a year or even longer. If the property owner is certain that the property is not going to be empty for longer than 3 or 6 months then some insurers will offer a short term policy. A short term unoccupied property insurance policy can also be purchased online from some insurance companies. The property may be empty but as a property owner you still have duty and care to treat the premises as if there is no insurance cover in place.
A few basic rules in taking care to minimise the risks to your empty property include making sure all accessible windows and external doors are fitted with good locks, turning off the water supply and draining the system, installing an alarm system if budget allows it. Also visiting the property periodically to clear any post and to keep the lawn mowed. Give the property a look that says it not unoccupied. Install timer switches for the lights to turn on and off at random times.
Some insurers will also convert the empty property insurance policy to a landlords let property policy if you decide to rent the premises during the term of your policy. Or it could be converted to a standard home insurance policy if you move in yourself. Insuring a property that is vacant is essential and expert advice is crucial to ensure that the level of cover you obtain meets your exact needs.
The proper rental property insurance coverage can protect you from losses caused by many dangers, including fire, storms, burglary, and vandalism. A comprehensive policy also includes liability insurance, covering injuries or losses suffered by others as the result of defective or dangerous conditions on the property. Liability insurance also covers the legal costs of defending personal injury lawsuits – a valuable feature because the legal defense costs of these cases are commonly much greater than the ultimate award of damages, if any.
The following list describes the three levels of coverage available for primary policies, all of which include liability coverage. Many insurance companies offer competitive insurance packages especially designed to meet the needs of rental property owners, so remember to shop around.
Basic coverage: Most companies offer a basic coverage package that insures your investment rental property against loss from fire, lightning, explosion, windstorm or hail, smoke, aircraft or vehicles, riot or civil commotion, vandalism, sprinkler leakage, and even volcanic eruptions.
This coverage often doesn’t include certain contents, such as boilers, equipment, and machinery unless specifically added as an endorsement. Based on the type of property you have, you may need to consult with your insurance agent about additional coverage that may be beneficial.
But just because you own a small retail strip center with a couple of plate glass windows doesn’t mean you need to have the special coverage that’s offered. Insurance companies often have minimum policy premiums, so certain insurable items and acts aren’t worth insuring because the potential for a claim is minimal and the costs are high.
Broad-form coverage: You get the basic package, plus protection against losses of glass breakage, falling objects, weight of snow or ice, water damage associated with plumbing problems, and collapse from certain specific causes.
Special form: This coverage is the broadest available and covers your property against all losses, except those specifically excluded from the policy. It offers the highest level of protection but is typically more expensive.
An insurance company can pay owners for losses in two ways:
Actual cash value: The coverage pays the cost of replacing property less physical depreciation. The standard policies most insurance companies offer provide for actual cash value coverage only.
Replacement cost: This coverage pays the cost of replacing the property without subtracting for physical depreciation. You must specifically have an endorsement and pay extra for replacement cost coverage. However, we do encourage you to purchase it.
As with homeowners’ insurance policies, the location, age, type, and quality of construction of your property are significant factors in determining your insurance premiums. Be sure to get an insurance estimate before you buy your property to avoid unpleasant surprises (older properties with wood shake shingles located away from fire protection may not even be insurable, for example) and realize the benefits of lower risk properties. For example, newer commercial buildings, and even some residential proper- ties, were constructed with fire sprinklers and alarms that reduce your insurance premiums – so do as monitored intrusion alarms).
Some insurance companies have a coinsurance clause that requires rental property owners to carry a minimum amount of coverage. If you carry less than the minimum amount of coverage, the insurance company imposes a coinsurance penalty that reduces the payment on the loss by the same percentage of the insurance shortfall. For example, if you carry only $1 million in coverage when you should have $2 million, you’re only carrying 50 percent of the minimum required insured value. If the building suffers a loss, the insurance company pays only 50 percent of the loss.
Many rental property owners first become investors by renting out their former personal residences when they buy new homes. They may not realize they should immediately contact their insurance agent and have their home- owners policy converted to a landlord’s policy, which contains special cover- age riders that aren’t in the typical homeowner’s policy. Because of the increased liability risk for rental properties, some insurance companies may not even offer this coverage, whereas others specialize in this business. Either way, obtain proper landlord’s coverage for your rental property, or you may face the possibility of having your claim denied.
If you own multiple investment or rental properties, consider
A single insurance policy that covers all locations: Rather than have separate policies for each rental property, you can get better coverage with a single policy. For example, if you currently have three properties each with a $1 million policy, you could get a single policy with a $3 mil- lion limit at a more competitive cost.
An aggregate deductible: An aggregate deductible is the portion of your loss that you essentially self-insure, because the losses at any of your three properties can go toward meeting the aggregate deductible.
Excess liability (umbrella) coverage
Excess liability (umbrella) coverage can be a cost-effective way to dramatically increase your liability protection and is designed to supplement your main or basic policies. An umbrella policy provides both additional and broader coverage beyond the limits of the basic commercial general liability insurance and other liability coverage and this coverage is only available after the primary policy limits have been exhausted.
Your primary policy may have liability limits of $500,000 or $1 million, but an umbrella policy can provide an additional $1 million in vital coverage at a cost of $2,000 to $4,000 per year. Depending on the value of your property and the value of the assets you’re seeking to protect, buying an umbrella liability policy with higher limits may make sense. Umbrella policies are avail- able in increments of $1 million with even lower rates per dollar of coverage as the limits go higher. The most common umbrella coverage amount for the owners of large investment properties now is $5 million at an annual cost of approximately $7,500 to $12,000.