Purchasing your first home can be both nerve-racking and exciting. Closing on your first home comes with lots of expenses. Sometimes, other costs overshadow homeowners insurance.

Your homeowner’s insurance policy shouldn’t be the primary reason to buy or reject a particular house. However, it should play a fairly prominent role.

To prevent getting in a financial bind, get estimates on your homeowner’s insurance policy. Especially before putting down a large sum on your home.

Deciding which type of homeowner’s insurance policy to purchase can be complicated. The insurance industry and their policies are complex.

Here’s a few standard actions homeowners should take when purchasing their first home insurance policy.

Explore Your Options

Doing your research is the top piece of advice insurance brokers provide. When seeking a quote, there are many factors that determine your home insurance premium.

These factors may include location of the home, proximity to the fire department, previous claims filed, the age of the home, etc. Because so many factors go into determining premiums, you’ll want to ask about rebates.

You can help by fixing up or renovating your new home. Purchase safety features like an alarm system and smoke alarms. These will often reduce the cost of your coverage.

Premiums can be expensive. It’s important to shop around to get the best deal possible.

Be sure to get multiple quotes, because every carrier has a different pricing model. Your rates could vary significantly from one carrier to the next.

There’s no way to know which carrier will have the lowest rates for your particular circumstances. What you can do is gather homeowners insurance quotes from the top insurers and compare their rates.

Bundle Your Policies

Bundling is when you combine auto insurance and homeowners under one policy. It can result in significant discounts and save you money.

Insurance companies want your business. By purchasing both an auto and homeowners policy, they’ll be more willing to give you a deal.

Besides bundling, you can have your homeowners premiums included in your mortgage payment. This is called an escrow account.

Your mortgage lender will pay your property tax and insurance premiums for you. Just make one combined monthly payment. This payment includes your mortgage and one twelfth of your annual property taxes.

Choosing a policy can be straightforward. However, consumers should be cautious of what is or isn’t covered in their policy.

Special luxuries and antiquities are not always covered. It’s important to do your research.

Specialty guitars, family heirlooms, one of a kind art, and more are not always covered under your policy.

Sometimes adding endorsements or riders to your policy will help you get the coverage you need.

Assess Risk

Risk associated with your home or area you’ll be living in is critical. You measure risk in terms of “likelihood”.

Home insurers look at the likelihood of a natural disaster or other unforeseeable misfortune occurring. The definition for this is peril.

Where you live will dictate the type of homeowner’s insurance you’ll need. Some areas need flood insurance. Others need earthquake insurance.

Lower levels of risk result in lower home insurance premiums.

Homeowners insurance is not, “one size fits all”. There are several different types of homeowner’s policies.

Which one is right for you, depends on the location of your home. This dictates the types of perils that may occur. And the relative risk of experiencing one of these perils.

The most common homeowner’s policy is the special form. They call this homeowners form 3 (HO-3).

According to the Insurance Information Institute, this form covers all perils except for ones specifically excluded.

• Ordinance of law
• Water damage
• Power failure
• Neglect
• War
• Nuclear hazard
• Intentional loss
• Government action

It would be in your best interest to add on flood insurance, if you live in a flood-prone area. Sometimes law requires it.

Another popular policy many first time homeowners go with is the broad form. Also known as homeowners form 2 (HO-2).

This policy only covers 16 perils. Again, depending on where you live, this may or may not be the best policy.

It might be best to purchase an HO-3 policy to get protection from more perils. Or you can add endorsements such as extended replacement cost coverage. This pays out additional money to repair your home if needed.

All of these choices come with different premium amounts. To help ensure you get the best rate, call an insurance agent or broker who can save you time and shop around and compare homeowners insurance quotes from top companies for you.

If you are moving to an area with a low risk of natural disasters, you might not need to purchase extra coverage. However, don’t assume where you’re buying a home lacks natural disasters.

Speak to an insurance broker. They can assess exactly the type of coverage you’ll need.

Along with the type of policy, there are varying amounts of coverage available. For example, you may opt to cover the entire value of your dwelling/home.

You can ask for coverage to include additional living expenses in case you lose your home to a covered peril. Your amount of coverage is due to the probability of a natural disaster occurring. Again, a licensed insurance agent or broker can help you determine your needs.

Wear and Tear of the Home

It’s important to assess what needs fixing up on your new home. Do this before deciding which type of homeowner’s coverage to invest in.

By spending up front to correct issues, you’ll be saving money in the long run. If you didn’t have a home inspection as part of the buying process, have one done.

Fix any items surfaced as a result of the inspection. Tell your home insurance agent. This may result in a lower price tag on your premium.

Assess Your Credit

People often overlook that insurance companies take your credit score into account when quoting premiums. It’s important to have a good credit score. This tells mortgage lenders you are trustworthy and will pay them back. The same goes for purchasing insurance.

A high credit score means lower premiums and mortgage rates on your first home.

For more information, contact Lallis & Higgins Insurance.

Quote Wizard

When it comes to insuring your boat, it’s often best to separate your boat insurance from your homeowner's policy. Many homeowners’ policies limit or don’t cover marine-specific risks, such as salvage work, wreck removal, pollution or environmental damage. But there are exceptions. Many homeowners policies include perfectly good coverage for smaller boats and motors, usually with a horsepower limit of from 25- to 100-horsepower. While homeowners riders are normally adequate for these boats, be careful to ask the same questions you’d ask any other insurer about damages to your vessel and how they will be paid. Also, most homeowners insurance riders apply only to use in inland waterways, lakes and rivers. Coverage seldom extends outside a coastal inlet or along the beach. If you plan to boat “outside the inlet” you definitely need an experienced marine insurer.

Many other factors will lead you to a qualified marine insurer, too, and here are the things to consider.

Insurance Factors

Insurers consider many factors when deciding whether or not to offer a policy. Almost any vessel can be insured— for a price. You want to consider the following to make sure the policy you purchase meets your needs:

• Age of Boat
• Length
• Value
• Speed/Horsepower
• Condition (Does it meet US Coast Guard Standards in effect at the time it was built?)
• Primary residence (If the boat is used as a primary residence)
• Type (Inboard, Outboard, utility, cruiser, bassboat, saltwater fishing boat, performance boat)
• Homemade (Boats without a serial number are tricky but many kits are okay)
• Houseboats with no motor
• Ownership (more than 2 owners)
• Where it will operate (Ocean, lakes, bays, rivers, Great Lakes)

Types of Boat Insurance

There are two basic types of boat insurance—“agreed value” and “actual cash value.” How depreciation is handled is what sets them apart. An "agreed value" policy covers the boat based on its value when the policy was written. While it can cost more up front, there is no depreciation for a total loss of the boat (some partial losses may be depreciated). "Actual cash value" policies cost less up front, but factor in depreciation. In other word, the policy will only pay up to the actual cash value of the boat at the time it is declared a total or partial loss. Eventually, as your boat ages, your insurer will likely insist on an actual cash value policy—and if often gives a substantial savings.

Kinds of Policies

Marine insurance covers a wide array of watercraft. You may be surprised to find what can be insured. Marine insurance policies include:

• Boat
•  PWC/Watercraft
• Yacht - generally, vessels 26' and smaller are called "boats,” and "yachts" are 27' and larger. Yacht coverage tends to be broader and more specialized because larger boats travel farther and have more unique exposures.
• Sailboat
• Dinghy
• Boat & PWC Rental – Although this is generally not required, rental insurance will help cover any damage the vessel, as well as the operator and passengers.
• Boat Clubs – covers all members of club while operating a boat.
• Professional (ProAngler, Fishing Guides & Charters) – These policies are very customizable and can cover items like travel to a tournament, equipment and more.

What Boat Insurance Policies Cover

How and where you boat determines the type of coverage you need. An "all risk" policy will offer the best protection. However, an “all risk” policy does not cover every type of loss. In insurance terms “all risk” just means that any risk not specifically omitted in the policy is covered. Typical exclusions include wear and tear, marring, denting, animal damage, manufacturers’ defects, design defects, ice and freezing.

You may also be able to add extra coverage. Available options may include: medical payments, personal effects, uninsured boaters liability, and towing and assistance. Most policies will cover permanently attached equipment, as well as items like anchors, oars, trolling motors, tools, seat cushions, and life jackets. Be sure to discuss these options with your agent.

Types of Coverage

This will depend on the type of policy, but common coverage add-ons (in addition to basic ones above) include:

• Specialized Coverage – Coverage for something specific on your boat like an expensive prop or navigation equipment.
• Salvage – Coverage that pays to remove your boat due to damage, from substantial to minor.
• Consequential Damage - Covers a loss that was the result wear and tear rather than an accident (rot, mold, corrosion).
• Towing – Towing your boat across a body of water to safety can cost $400 per hour.
• Cruising Extension – You can get temporary, additional coverage if you plan on leaving the USA (typically to Mexico or the Bahamas).

Shopping for Boat Insurance

Start with a little fact-finding. Ask your boating friends which company they use and how their claims have been handled. The way an insurer has handled claims in the past is a good indicator of the quality of service you can expect in the future.

State insurance regulatory agencies are also a good reference and can be found online.

Boat Insurance Cost Factors

Many factors are used to set the cost of a policy, and they vary among insurers. Here are some items to consider:

• Cruising Area - where you boat
• Boating Safety Education - if you have been formally trained or certified
• Good Driving Records - both boating and driving
• Liability Limits - the higher the limit the higher the cost
• Deductible - the higher the deductible the lower the premium
• Towing insurance requirements for offshore fishing. A 20-mile tow could cost $3,000

Storm Plan

If you boat in a hurricane zone, your insurer may expect you to provide a hurricane plan. If a storm approaches, will you have it stored in a hurricane-proof facility or will you tow it or skipper it to a safer harbor. The answer can affect your rates, even lower them, but be prepared to follow the plan, because your coverage may hinge on it.

Discounts

There are a few ways to reduce your boat insurance costs. For example, if your boating is restricted by seasons and your boat is in storage during the winter, you can get deductions for winter layup. Many insurers offer discounts for good driving records and for anyone who has completed boater education classes. Finally, it usually costs less to be insured in fresh water versus salt, so be sure to discuss where you boat with your agent. You may earn extra savings by bundling your coverage with the same company that insures your home and/or car.

Before you buy your new vessel, it’s a good idea to determine your insurance costs based on your needs.

For more information on boat insurance, contact Lallis & Higgins Insurance.

discoverboating.com

Do you have flood insurance? Do you need flood insurance?

If you don’t have the answers to these questions or are unsure of the answers to these key questions, we can answer them for you here.

Of all the natural disasters impacting the United States, floods are the most common. Average homeowners are five times more likely to deal with flood than fire damage. (And your chances increase if you live in a medium- or high-risk area for floods.)

Flood damage can be expensive to repair. The National Flood Insurance Program (NFIP) estimates a six-inch flood that hits a 2,000-square-foot home is likely to cause about $40,000 in damage.

Then there's the surprising fact that most standard homeowners and renters insurance policies don't cover flood damage.

Warning: Homeowners and Renters Policies Don't Cover Flood Damage

Typical homeowners and rental insurance policies don't cover flood damage.

Most people ignore flood insurance for this very reason. They assume the insurance they have will protect them from the aftermath of a flood.

In fact, you have to go out of your way to buy flood insurance as a separate policy from the NFIP. The Federal Emergency Management Agency (FEMA) administers this insurance. Or from one of the 80 private insurance companies that provide flood coverage.

A Few More Reasons as to Why You Shouldn't Ignore Flood Insurance

Generally people overlook flood insurance because they don’t think they need it.

Statistics show US homeowners (and renters), in general, are likely to deal with flood damage at some point in their lives.

Chances are higher if you live in an area that's considered “high risk” for flooding. There’s a one in four chance of experiencing a flood during the life of a 30-year mortgage in high risk areas.

Low- or moderate-risk areas, as according to the NFIP, field almost 25 percent of flood-damage claims. So, flood insurance is a good idea no matter where you live.

When You Are and Aren't Required to Have Flood Insurance

Do you live in a high risk area? Is your mortgage with a federally regulated or insured lender?

If you answered yes to both questions, you're required to have flood insurance.

If you live in a moderate- or low-risk area, you aren't federally obligated to have this kind of insurance. Although some lenders may still require it.

In some situations, government aid is available for flood damage to homeowners who didn’t have flood insurance. However, if they want to quality for future aid, they need to purchase a flood policy first.

One Rate is Just Like the Other?

Flood insurance rates are set nationally and don’t differ from company to company or from agent to agent.

Don't take that to mean that everybody pays exactly the same amount of money for this kind of coverage. What it means is that, all things being equal, the quote that you receive from one agent will be the same as one you receive from another agent.

That particular rate is based on a number of factors. Including the age of your home or building, how it was built, the elevation of your property, and its overall flood risk.

Contemplating Coverage Impacts and Limits

Another factor companies take into consideration when determining your rate is the desired amount of coverage. Be aware, though, that standard flood policies place certain limits on the coverage they offer.

Homeowners can buy a maximum coverage of $250,000 for buildings. And up to $100,000 for their contents.

Buildings may include the actual structure and its foundation, as well as any air-conditioning, electrical, heating, and plumbing systems and equipment.

Business owners can buy up to $500,000 in structure coverage and $500,000 in personal property coverage.

If your building is worth over $250,000, you'll have to buy excess flood insurance. This increases your coverage limit to $750,000. (Businesses can extend their coverage up to $1 million.)

Don't Worry, It's Easy to Buy

Despite the fact that flood insurance is a separate policy, it isn't difficult to purchase.

In fact, it may be easier to buy than some other forms of insurance. Options are limited to private companies and agents that have partnered with the NFIP.

Also, the NFIP makes the process of finding those companies and their agents pretty straightforward. Additionally, an extensive list of "participating companies" can be found at fema.gov.

A Few More Things You Should Know About Flood Insurance

There's a 30 day waiting period. In most cases, flood insurance policies won’t take effect until after that period is over.

You'll still be eligible for government aid. Having flood insurance won't prevent you from receiving government aid if you live in an area declared as a federal disaster area due to flooding.

Government aid isn't a suitable alternative to a flood policy. You may be thinking, "Hey, why should I bother paying for insurance when federal disaster assistance will bail me out?"

The reality is government aid isn't all it's cracked up to be. There are a few reasons for that.

First, before a community can become eligible for this assistance, it has to be declared a federal disaster area. And these declarations are issued in less than 50 percent of flooding incidents, according to the NFIP.

Second, federal disaster aid usually takes the form of a low-interest loan. The loan is designed to help pay for the repair of flood damage. It isn’t straight compensation that doesn't need to be repaid.

A flood is a fairly specifically defined event. Just because your basement fills up with water after a torrential rain storm, doesn't mean the resulting devastation will be covered by your insurance policy.

For that to happen, the flood has to affect two or more properties. Or, if affects only your property, it has to have covered two or more acres of land. Also, you might want to note that damage from wind-driven rain--such as when rain comes through a hole in a wall or roof, or through a wind-damaged window--isn't considered flood-related.

For more information on flood insurance, contact Lallis & Higgins Insurance.

quotewizard.com

The way homes and furniture are now built creates a new challenge for local firefighters.

They’re changing how they fight fires and going back to basics.

Boston 25 News Anchor Blair Miller suited up with Cambridge firefighters as they trained, for a rare look the true dangers they face in these quick-burning homes.

“Every skill we learn perishes if we don't keep it fresh,” said Cambridge Deputy Chief Sean White.

White says they've long been taught to “open a fire”, by creating a hole in the roof of a home or business. But he also says that may no longer be the best plan of attack according to new research.

"We've had to really go back and re-invent the wheel and use our tactics a little bit differently and at different times,” he said.

He points largely to the way furniture and homes are now built, as the reason why.

“The fuels have changed. The synthetics that have gotten into the couches, beds and everything like that. They burn at such a higher heat release rate. When you open up those windows or roof too early, it stimulates the fire,” said White.

Into the flames

Firefighters are working on new techniques at a special training location in Quincy that simulates darkness, smoke and intense fire.

Side by side with them, Boston 25 News went up six flights in the training tower. Firefighters raced to hit the fire with water, then looked for a window to let the smoke escape.

“We need to get the cooling of the water effect on the fire first before we open and that's a big change for us,” said Deputy Chief White.

“Over time, things change and they have different scenarios and different ways to fight fires that help out,” firefighter Rick Feliciano said after the training. Communication was often a huge challenge. Crews learn to focus on relaying signals to work well as a team.

“If we're not very good at what we do and we don't do it well fast, then we're out of air and things don't go so well.”

After that training exercise, the group of firefighters reviewed what went wrong and what went right to make sure when a real fire happens, every firefighter comes out alive.

For more information, contact Lallis & Higgins Insurance.

Fox 25 Boston

It’s Not Just a Quote, It’s a Relationship

Shopping for insurance? You may think you’re simply looking for an insurance policy. But, perhaps, what you’re really looking for isn’t a “what” but a “who” - someone you can trust to guide you through all of the insurance choices, rather than trying to make sense of all the options yourself online.

That someone is an insurance agent, but there are countless agents out there – not to mention different types. So, how do you choose? Use these four steps to select the type of agent that’s right for you and find one you want to work with to purchase, review and manage your policies on an ongoing basis.

1. Know the Types of Insurance Agents

Some insurance agents represent only one insurance company. These are known as direct, or captive, agents, and they are direct employees of the company whose policies they sell. Any policy he or she sells will be from that company, and that company only.

An independent insurance agent, on the other hand, represents a number of different carriers, oftentimes as an employee of a local agency in your community. An independent agent isn’t restricted by what any one carrier offers, so he or she has more flexibility to help you explore a broader range of options.

2. Get Recommendations

The best way to predict what kind of service you can expect from an agent is to find out what kind of service he or she has provided in the past. Ask for recommendations from family, friends and neighbors, and then ask for more details.

• What does your friend or co-worker like about that agent?
• Have there been any problems or complications?
• Was the agent helpful, attentive and friendly?
• Was the agent knowledgeable, answering all questions satisfactorily?
• Most importantly, were the agent and the company he or she represents dependable, timely and supportive through the process of resolving a claim?

3. Research the Agency and Agent
Once you have a few recommendations in hand, it’s time to research your prospective agents, the agencies where they work and the companies they represent. Here are a few places to check:

• The website of your state’s Department of Insurance. Here you can likely see any complaints, investigations or disciplinary actions against agents, as well as ensure they have an active license. You can likely look up information about various carriers, as well.
• Local chambers of commerce or the Better Business Bureau.
• The agency’s own website, which should outline their services, the types of insurance they offer and the carriers they represent. • Online reviews for the agency.

4. Interview the Agent

Your research paid off, leading you to an agent in your area who seems like a good match for you. Now’s the time to ask some tough questions to be sure.

Tell the agent what you’d like to insure, and ask how he or she would be able to help. If you or a friend has gone through difficult insurance experiences before, ask how he or she would deal with a similar situation.

Ask if they get involved in the claims process, or ask any of those other questions you’ve always wondered about insurance. Pay attention to whether the agent offers specific examples or speaks in generalities, as well as to whether he or she is talking about insurance in a way that makes sense to you. You can also ask for references.

A prospective agent may be able to give you a quote at this point. But, what you really want is a sense of how well you could work with this person. Is this someone with whom you can communicate easily and in whom you can place your trust?

Because, when you’re shopping for an insurance agent, you’re not just looking for an attractive quote. You’re looking for a good working relationship that can endure through new cars or homes, fender benders, storm damage and much more.

For more information, contact Lallis & Higgins Insurance.

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