As the events of the last few years in the real estate industry show, people forget about the tremendous financial responsibility of purchasing a home at their peril. Here are a few tips for dealing
Is It Wise To Consolidate All Insurance Policies With One Provider
The types of things you should or could have insurance for vary as widely as the types of coverage and plans that are available for you. The first thing you’ll want to do is review the assets that you own and decide if that item is something that a) is currently insured, b) can be insured, or c) should be insured.
According to Scott Smith from Premier – The Home Services Company; “There are some obvious assets in your portfolio that have statutory requirements that you carry insurance. There may even be rules on minimum coverage requirements. For example, all states require that you have car insurance. Lenders most often require that you obtain homeowners insurance in order to mitigate the possibility of loss for them. Landlords and storage units usually require that you have some form of renters insurance. These are but a few of the many instances that would require you to be insured.”
There are a couple of reasons that make sense from a cost and time perspective. If you have separate policies for all your insurable assets you can spend a significant amount of time keeping track of who and when to pay what. The second purpose would be to lower your overall cost. Most insurance companies can accommodate your insurance needs, with the premise of the quantity of policies you place with them they will discount your total cost.
It pays to take the time to shop insurance companies and assess what your actual needs are. For instance, New Jersey law requires that you carry car insurance. You must at the very least obtain a basic policy. It is definitely has the most affordable cost, but also has limited coverage:
5,000 of property damage liability (PDL) per accident. This covers damage you may have caused to someone’s property in a car crash.
$15,000 of personal injury protection (PIP) per person, per accident. This coverage pays for injuries you suffer in a car crash.
Up to $250,000 for very severe injuries, such as permanent brain injuries.
If you go with a Standard policy option this has a higher premium but offers more extensive coverage.
With the Standard policy, you get a minimum of:
$15,000 of bodily injury liability (BDL) insurance per person, per accident. This coverage will pay for injuries to anyone not in your car if you cause a car crash.
$30,000 of BDL for multiple injured people per accident.
$5,000 of PDL per accident.
$15,000 of PIP per person in a car accident.
Up to $250,000 of PIP for severe or permanent injuries.
Regarding your homeowner policy options in New Jersey include the following common coverages:
Dwelling (Coverage A) pays if your house is damaged or destroyed by a covered loss.
Other structures (Coverage B) pays if structures not attached to your house, such as detached garages, storage sheds, and fences are damaged or destroyed by a covered loss.
Personal property (Coverage C) pays if the items in your house (such as furniture, clothing, and appliances) are damaged, stolen, or destroyed by a covered loss.
Loss of use (Coverage D) pays your additional living expenses (costs over the normal amount for housing, food, and other essential expenses) if you must temporarily move because damage to your house from a covered loss renders it uninhabitable.
Personal liability (Coverage E) pays to defend you in court against certain lawsuits and provides coverage if you are found legally responsible for someone else’s injury or property damage.
Medical payments to others (Coverage F) pays the medical bills of people hurt on your property. It might also pay for some injuries that happen away from your home, such as your dog biting someone at the park.
When consolidating your policies, after reviewing all the specifics, it boils down to economics. By doing so you will be saving your annual out-of-pocket premium costs.
As you combine your policies you will see if there are any overlaps or deficiencies in your overall coverage. This is where an umbrella policy may need to be added to cover just those items or instances. An umbrella policy can be very affordable and is designed to cover any gaps in your other policies. They also can cover loss amounts that are limited otherwise. An example of this would be to add an umbrella liability policy if you were a swimming pool owner.
The basic understanding of this is to protect your assets and limit your liability. It pays to do your research and assess what will best suite those interests for you.
Sam Lepore is a Realtor with Keller Williams in Moorestown, NJ. Call him today at 856.297.6827 ....