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We all make mistakes from time to time. Some mistakes you make, however, can increase your premiums or even cause you to lose your important Florida or South Carolina homeowners insurance coverage. Here are some mistakes to avoid.
If your invoice shows a June 1st due date/expiration date, your premium should arrive on or before June 1st. If you miss that deadline, your coverage will lapse.
This means you have no coverage and you need to reapply to reinstate your homeowner’s coverage. This can be very risky, because market conditions are especially volatile right now with the large number of storms breaking out across the United States and with hurricane season on the horizon.
If your insurance policy lapses, your current carrier may take the following actions:
If you have had even minor claims in the past, your current insurance carrier will need to reevaluate your total risk profile as standard procedure and could refuse to rewrite your coverage. This may leave you with few coverage options and at significant risk of having to take higher deductibles and paying a much higher premium.
Additionally, a lapse in coverage may mean you face an uncovered loss. If a significant storm is on the horizon when your policy lapses, you may not be able to get coverage at any price due to binding restrictions that will be in place for all insurance carriers. We all forget to pay things from time to time. Consider automating your payment with on-line banking. That way, you never have to worry about your premium being late or a lapse in coverage.
You may be tempted to think that because home prices have dropped in the Southeast, you can lower your coverage limit to save money. This may seem like a savings until a claim occurs, resulting in the possibility you will not have enough coverage.
For another example, if you have an alarm system on your home, you may decide you can safely remove your jewelry endorsement schedule. If you misplace one of your most valuable pieces of jewelry, however, you may discover that you have no coverage for mysterious disappearance. While you may save money in the short run, always talk to your agent about the disadvantages of making these changes before you decide. Your insurance agent has seen many worst-case scenarios and can help guide you in reducing risk.
Sometimes events happen in your life that cause changes to your homeowner’s risk profile. For example, perhaps you decide to rent out that second home you own, or you may be responsible for handling your parent’s estate and a home is part of that future inheritance. It is imperative that you alert your agent to any occupancy changes to your homes, because a change in occupancy can eliminate coverage in some circumstances.
Does Homeowners Insurance Cover Floods?
Few are. Unless you live in a flood plain, your mortgage company will not require you to carry flood insurance. Additionally, damage from rising surface waters is not covered under your homeowner’s policy.
Repairing damage after a flood is expensive and disrupts your life or business for weeks or months. According to the National Flood Insurance Program, with only four inches of water causing damage to a 2,000 square foot home, you can expect total damage to run $29,650. Flood insurance can help you repair your home after flood damage or seepage through the walls and floor into your home from nearby floodwaters.
Flood insurance is very affordable and perhaps one of the most misunderstood and underutilized coverages available to homeowners. There is a 30-day waiting period to buy flood insurance, so if you think you may need flood coverage, don’t wait!
Making changes to your Florida or South Carolina homeowners insurance requires a lot of thought. While it may seem like you are saving money by reducing or eliminating coverage, one claim can result in the possibility of not enough coverage or no coverage at all.
While some people buy insurance on-line, it is important that you have an agent you can call for advice. Don’t make decisions about one of your most important assets without help from an experienced insurance agent. Visit our website to locate an agent near you.