Home Insurance - it protects your home, it protects your stuff, and it’s required! A home is your largest purchase during your lifetime (in most cases) - and you want it to be protected. Your home insurance not only covers your home, it covers your mortgage and anything on your property, the only difference is the WAY it is covered. There is coverage for a temporary residence and is typically covered during a disaster. There is landlord and renter insurance that covers the loss of rent or the items lost in the rental property. There is “Fun” legal protection for when we have guests over every once in a while. If something happens to your guest, the home insurance has coverage dedicated to your guests. It’s typically for medical and liability (minimum $100k).
What’s Happening now?
What’s happening in the market now - insurance costs! Overall, rates are up and continue to increase from approximately 10% to 15%. In Central Florida, it’s going up by 30% to 40%! SOLO - Seminole Orange Lake and Osceola - those are the counties that are being focused on as far rate increases, policy cancellations, and no new policies. Insurance companies are targeting roof age (needs to be 15 years or newer), water heaters (needs to be 15 years or newer), and flat roof homes. From the disasters in 2017 (Irma), claims skyrocketed, payouts increased, roofs replaced, damages repaired, and families rehomed.
The deteriorating financial condition of Florida’s domestic companies has been blamed on several factors: excessive litigation, contractor schemes, several years in a row of major catastrophes and the increasing cost of reinsurance. The combination of these factors led to $1 billion in losses for Florida domestic companies during the first three quarters of 2020, more than double the underwriting losses of 2019. While carriers face growing financial losses in Florida’s distressed property insurance market, insurance agents are on the front lines trying to help their clients who are being hit with double-digit rate increases, non-renewals, coverage restrictions or refusals from the admitted market.
what to know when “shopping” for insurance
Buying a homeowners policy may seem straightforward until you experience the first damage to your home and realize your policy doesn’t provide coverage. If damage is done to your home, this policy makes or breaks you. Here are some vital tips to know before buying a homeowners policy in Florida.
compare coverage
Insurance companies do not offer similar policies. The content and pricing of a homeowner’s insurance policy is different for every insurance company. Before purchasing a policy, it is paramount you shop around for your best coverage for your specific needs. With some companies, you are required to purchase additional insurance, like mold insurance (which, let’s be honest is everywhere in the Sunshine State!). Don’t just look at the price and pick the rock bottom. Ensure you go for one with enough coverage and priced to fit your respective budget.
Escrow Your Premium With Mortgage Payments
Many homeowners carry a mortgage. One great way to manage the premiums for your policy is to add it to your regular mortgage payment. This simply means your lender takes over the duty of paying your monthly insurance payments. This kind of account is referred to as an escrow account. Most lenders opt for this account because it guarantees you are paying your premiums and thus, the investment they made in you is protected. With most insurance providers, you are required to meet the costs for the closing year.
adequate coverage
The most vital item you should check is the level of coverage. Homeowners insurance comes in different levels with each level covering different items. The most common levels of homeowners insurance are levels HO-2 and HO-3.
HO-2 is referred to as the “standard” level. It is the most common and it covers 16 named perils. It is an upgrade of the “basic” HO-1, which covers 10 risks. However, this policy doesn’t cover everything in your house.
HO-3 is a more comprehensive upgrade of HO-2. It covers all perils that can happen to your home apart from a named list of perils such as earth movement, flood, mold, and military action/war, which are not covered. But you live in Florida, so might need both flood and mold, so here is a little bit more on each:
Flood: Does the homeowner’s policy cover flooding? Well, the standard homeowners policy says little about flooding. For flood coverage, you have to read your policy very clearly, or talk with your agent, to see the extent of flood coverage. For efficient flood coverage, you have to buy an additional NFIP policy that covers your home structure up to $250,000 and personal possessions up to $100,000. It offers replacement cost coverage for the home structure and actual cash value for personal possessions.
Mold: Does the homeowner’s policy cover mold? Well, to be frank, many insurance companies are running away from mold coverage. Some companies completely exclude mold-related coverage while others cap the amount of money to pay in mold coverage. Other companies only pay for a few things such as testing or cleanup. Most companies today provide “buy-back” endorsements whereby you get covered for mold but in exchange of more money.
know the Policy Details
It is of great importance you familiarize yourself with the following key terms:
Deductible
Liability cover
Personal property
Premium
Actual cash value
Replacement cost
Riders
Sub-limit
These terms dominate the homeowner’s policy. By understanding each of them, you are a step ahead of many and ready to talk with an agent about your best policy at the right price in Florida.
ways to lower your insurance cost
The price you pay for your homeowners insurance can vary by hundreds of dollars, depending on the insurance company you buy your policy from. Here are some things to consider when buying homeowners insurance.
Shop Around! It'll take some time, but you could save you a good sum of money. National Association of Insurance Commissioners (www.naic.org) has information to help you choose an insurer in your state, including complaints.
Don’t confuse what you paid for your house with rebuilding costs! The land under your house isn't at risk from theft, windstorm, fire and the other perils covered in your homeowners policy. So don't include its value in deciding how much homeowners insurance to buy. If you do, you will pay a higher premium than you should.
Make your home more disaster resistant! Find out from your insurance agent or company representative what steps you can take to make your home more resistant to windstorms and other natural disasters. You may be able to save on your premiums by adding storm shutters, reinforcing your roof or buying stronger roofing materials.
Improve your home security! You can usually get discounts of at least 5 percent for a smoke detector, burglar alarm or dead-bolt locks. Some companies offer to cut your premium by as much as 15 or 20 percent if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire or other monitoring stations.
Review the limits in your policy and the value of your possessions at least once a year! You want your policy to cover any major purchases or additions to your home. But you don't want to spend money for coverage you don't need. If your five-year-old fur coat is no longer worth the $5,000 you paid for it, you'll want to reduce or cancel your floater (extra insurance for items whose full value is not covered by standard homeowners policies such as expensive jewelry, high-end computers and valuable art work) and pocket the difference.
florida homeowner insurance
The Sunshine State may be a gorgeous place to live, but its residents also face several hazards each year. As a coastal state, Florida is susceptible to natural disasters, such as hurricanes and sinkholes, which drives premiums sky high. As recently as October 2020, Tropical Storm Eta caused more than 14 inches of rain in South Florida. Although Florida writes more flood insurance policies than any other state, flood coverage is usually not included with the average Florida homeowners insurance policy.
Most Florida homeowners insurance policies come with standard coverages such as for your home’s structure, detached structures, personal property and loss of use. Common perils such as theft and fire are included with basic coverage as well. However, to be best prepared for state-specific losses, Florida homeowners will likely want to consider purchasing additional coverage.
The IDEA Club
edwin gonzalez
integrity insurance
Edwin started as a licensed agent in the insurance industry in 2008 while going to school for his Bachelor’s degree at the University of Central Florida. Edwin was on the Member Board of Directors for Downtown South (Sodo District) from 2015-2018 and volunteers as a drummer for Discovery Church.
Edwin is an insurance agent providing solutions for Home, Auto, and Business insurance needs and understand that each customer is unique when it comes to insurance coverage. What he provides is a way to help navigate the insurance industry and provide his my clients with the best value for their dollar, while supplying a superior standard of protection. The companies he represent offer tested, reliable insurance products, excellent customer service and have an outstanding reputation for fast, fair claims service.
Edwin hopes you will take advantage of his industry experience and let him serve you for all your insurance needs. He encourages you to contact him with any questions or concerns you may have.
