Homeowners insurance covers your home, your personal property and protects you against law suits.  One of the most misunderstood issues with homeowners insurance is regarding property that may be your responsibility that is under ground in your yard.  Most people believe that these pipes are covered by their policy.  Unfortunately, water pipes leading to your home and sewage pipes leading away from your home are excluded under most homeowners policies.  Repairing these pipes is very expensive.  Just digging them up can cost a two or three thousand dollars. What is really frustrating, is that this is not an exposure that you can even see much less maintain.  One day everything is working fine, the next your front yard is a marsh from thousands of gallons of water (that you are paying for) and you are looking for a plumber who has a back hoe.  That’s the bad news.

The good news is you can purchase coverage for these pipes from a very unexpected source.  When I first learned of it, I was surprised at the source of the coverage and amazed by how little it cost.  I purchased coverage for my pipes from my local electrical utility company.  Here in Fairfax County, VA that is Dominion Power.  The cost was just a few dollars per month.

Make no mistake, this is a good deal and I recommend you call Dominion or go on line right now and add the coverage to your service.  Very few insurance companies are willing to take on the exposure and I am certain that none would do it for the prices offered by Dominion.  A few extra dollars on your electric bill is a small price to pay for some real peace of mind.

Condominiums offer many benefits to their owners.  Not having to mow the lawn, do landscaping or care for the exterior of the building lure many people into purchasing a condo.  However, many condo purchasers do not fully realize how their personal exposure to property and liability losses changes simply because they moved from a traditional home to a condo.

Condominiums probably are among the most complex insurance exposures because there are so many potential parties to a claim.  First, there’s you, the unit owner, then there is the association that represents all unit owners and then there are your neighbors.  Some of your neighbors may be owner occupants while others may be tenants.  So, when there is a loss, determining who is responsible for paying can be complicated.  Here is a quick example of a common claim that can drive unit owners crazy:

You wake up one morning to find water streaming through the ceiling in your laundry room.  It is pouring fast and furious and quickly soaks into the hall carpet and is spreading quickly.  The ceiling dry wall is coming down everywhere and the walls are beginning to soak up the water too.  You do everything you can to prevent the water from spreading, but you must find a way of stopping it at the source so you pick up the phone and call the management company.  They will either send out a repair man or will refer you to your condo docs that say you should call a plumber.  Realizing that those solutions will take too long, you go upstairs to see if your neighbor is having the same problem.  In the hall, you meet the neighbor down stairs who is also getting water in his laundry room and was coming to see if you were the source.  The neighbor above you comes to the door, and it is apparent he just woke up.  You explain what is happening and he checks his laundry room to discover the hose to his washer is broken.  He turns off the water and the problem is solved.

Now, comes the really messy part.  Who is going to pay for cleaning up the mess and repairing all the drywall and carpet.  Who is responsible?  Is there legal liability, was anyone negligent?  What is the Association responsible for?  Does the neighbor who originated the loss own the unit or does he rent?  What if he does not have insurance?  You get the idea.  This simple and common loss creates many questions and not all of them can be answered the same for every condo association.

The problems can be complex, but the solution is simple.  If you have a condo unit owners policy, you really aren’t that concerned about how all those questions are going to be answered because you know your policy will pay for your damage.  The insurance company will figure out who was at fault and will subrogate against that person.  In the mean time your home is made whole again.  Which in the end is all that is really important to you.

If you own a condo, Condominium Unit Owners Insurance is an absolute necessity.  The Association policy will not protect your interest when you have a loss.  That policy will protect the interest of the Association as a whole.  The Association policy does not protect you as an individual who has suffered a loss.  The unit owners policy will not only protect your unit, but it will also cover your personal property, provide you with a place to stay if you can’t stay in your unit after a loss, will pay legal fees and judgments in cases where you are responsible for someone else’s loss and even cover assessments that the association may levy against the unit owners.  It is truely a magic bullet when it comes to settling condo claims quickly.

So, you are probably thinking that a policy that can quickly resolve all these complex problems is going to cost you an arm and a leg.  That is the most magical part of the policy.  Most people pay from $10 to $20 per month depending on how much coverage they need.  That is less than a dollar a day! How much is peace of mind worth?  I am thinking it is worth a lot more than a buck a day.  That makes Condominium Unit Owners Insurance one of the very best insurance deals around.

Condominium Unit Owners Sample Price Quote:

Personal Property                    $  30,000

Additions & Alterations          $  20,000

Loss of Use                             $  30,000

Loss Assessment                    $    1,000

Personal Liability                    $500,000

Medical Payments                  $    1,000

Deductible                               $       500

Water Backup Coverage         $  10,000

Total Annual Premium          $ 135.00

This is a sample quote and your actual premium will be based on your specific circumstances.  However, this is not a “low ball” quote.  It is about average for most people.  To get a quote for yourself, simply quote on the “Get a Quote” on the navigation bar.  We will send you information within a business day.  Or just CLICK HERE

For most people insurance is a necessary evil like taxes.  However, during a tough economy having the right insurance can make the difference between financial solvency and financial disaster. Cutting back on your insurance policy can be disasterous.

I have seen many customers cut back their coverage in an effort to save a few bucks and it seems almost inevitible that as soon as they do they suffer a loss.  It’s like Murphey’s Law suddenly applies.  Perhaps it’s because the client becomes ultra aware of the additional exposure and increases their odds of suffering a loss.  Regardless of why it happens, it happens so frequently, that it is almost the rule rather than the exception. 

Rather than cutting your coverage, you should be looking at ways to enhance your coverage to get the best value  for your money.  Here are some ideas that you can use to increase the value of your policy and reduce your costs for premiums or potential losses:

1)  Increase your deductible.  You can put the deductible on a credit card and pay it off over time if you suffer a loss.  You could save $50 – $100 per car per year or more with this one change.  You could save another $100 on your homeowners insurance.  Put your savings into increasing the liability coverage.  If you are sued by someone you have injured you will be glad to have the additional coverage.  As a rule, you cannot have too much liability coverage.  People generally sue for $1 million or more.

2)  Purchase deductible waiver for total losses on your car insurance.  The cost is only a few dollars per month, but could save you an unexpected out of pocket expense.

3)  Make sure your car insurance has accident forgiveness.  Especially if you have a young driver in your home.  This can save you from unexpected increases in your premiums because of an accident.

4)  Make sure your home is insured to the right value.  Following a loss the insurance company will determine if the home was insured to 100% of it’s Replacement Cost.  If it falls below 80%, you will have to pay a significant amount of that loss out of pocket.  This is the co-insurance clause on your policy.  If you read it you will learn that it is the policyholder’s responsibility to insure the home to 100% of replacement value.  This could save you thousands of dollars following a loss and may only cost a few dollars per year.

5)  Make sure you have coverage for sewer and water back up.  Especially if you have a basement with a sump pump.  Water or sewage back up losses are always expensive.  The coverage is relatively inexpensive, but suffering a loss without the coverage will cost you thousands of dollars.  If your basement is finished the cost of the loss can escalate quickly.

6)  Make sure you have coverage for changes in local laws and ordinances.  Your homeowners insurance may not automatically cover you for these changes and you may have to pay out of pocket to bring your home up to current building codes.  Law & Ordinance coverage is usually less than $20 per year and it also provides coverage for demolition to un- damaged portions of your home so that the damaged portions can be rebuilt.

7)  Consider getting your Road Side Assistance from your insurer.  It is usually much less expensive than AAA and they offer similar benefits.  This could save you $100 a year.

8)  Consider getting your Identity Theft Insurance from your homeowners insurance company rather than buying it separately or buying it from your bank.  The insurance company uses a third party vendor that specializes in the protection and charges customers a fraction of the cost than if the coverage is purchased separately.
9)  Insure your car and home together.  The discounts with most insurers range from 10% to 25% and apply to both policies.  This one change can save you hundreds of dollars per year.

10)  Young drivers who are good students and maintain a “B” average or better get significant discounts on their car insurance.  This discount can be worth hundreds of dollars per year.

11)  Some homeowner insurance policies offer discounts for customer who are over age 50 and are married.  Check with your insurer, you could save an additional 10% or more.

12)  Loyalty counts with insurance companies.  If you are a long term policyholder you stand a much better chance of retaining your coverage if you suffer losses than a new customer.  Shopping for coverage after you have been cancelled is expensive.

13)  Research companies that you may be considering purchasing insurance from.  Many companies are experiencing financial difficulties because of the down turn in the economy.  To maintain cash flow, some of these companies are under cutting the market prices.  This is a short term strategy that will result in sharp increases in the long term.  Also, insurance companies are not backed by the federal government.  So, if your company goes belly up, you may have difficulty getting claims paid or even changing companies.

I hope these suggestions help you to become a better educated insurance consumer.  Finding value in an insurance policy does not always mean that your policy is the cheapest.  Remember the old saying that the oats are always cheaper once they have been through the horse!  You definitely get what you pay for with insurance.  All companies have to work with the same conditions in a given demographic and if one company is a lot cheaper than another, it is usually temporary.  Look for long term value and a relationship that you feel good about and a company that is financially strong.