Saturday, November 2, 2013
Illinois Homeowners Insurance Guide - Answers to Common IL Home Insurance Policy Questions
There are a thousand questions that people might ask themselves when it comes to Illinois homeowners insurance. The reason for this is that the state according to the United States Census Bureau had 12 million residents in 2006 and it has been gradually growing. As the home insurance industry faces a greater demand, they come up with new ideas and plans. In this article you will simply see the many faces of the Illinois home insurance industry and the frequent asked questions that many people have trouble with. Read this Illinois homeowners insurance guide to help you understand your coverage options a little better and maybe even find a cheaper Illinois home insurance rate!What Does My Illinois Home Insurance Policy Cover?This is perhaps the most important question faced by insurance customers in not only the state of Illinois but all over the United States. Below you will see a list of things that are covered under a standard Illinois home insurance policy and they will be briefly explained.1. Natural Disasters and Accidents: Because the types of disasters or accidents covered by each policy vary from company to company it is important to know what the things you are covered for are. Any loss due to fire, storms, hail, tornadoes and hurricanes are at the top of the list for any insurance company. However, important and devastating events such as flooding and earthquakes are not offered by many. For this reason you should be very cautious and read the insights of your policy.2. Your Possessions: A traditional part of any homeowner insurance policy is the coverage for your possessions. Usually the company pays from 50 to 70 percent of the total value of the house, but this varies from company to company. If you lose possessions such as furniture, jewelry, clothing and electronics your home insurance policy should provide you with some money for them.3. Loss of Use: This is simply the price that an insurance company must pay for you to live somewhere else while your house is being fixed or reconstructed. This only pays you when your home is not suitable for you to live in it!How Is My Credit Score Used?It is important to understand that credit score is being used more and more nowadays by insurance companies in any industry. A reason for this is that insurance companies need to protect the "risk" of insuring an individual at all costs. There are primarily two ways in which your insurance company will be able to use your credit score. One of them is what they call "underwriting". This simply means that they check your credit score to see if they are going to issue you a new policy or to see if you will be eligible to renew with them.The second reason for checking credit report might be a little bit more important than the first one because it involves premiums. Illinois home insurance companies also use the credit report as what they call "rating". Based on that credit report they will be charging you more or less on premiums. The reason for this is that a person with a bad credit report is more likely to just stop paying the monthly premiums and drop the coverage than someone with good credit.What Things Affect Illinois Homeowners Insurance Prices?There are many things that can affect your Illinois home insurance prices, but it is important to understand the many things about you and the house that can make a difference when it comes to the price of your residence.The type of construction and the age of the house are definitely two main things that will be able to affect your premiums. Most frame houses are not really that safe because they are not as strong when it comes to supporting a storm than brick houses. Termites might be another costly thing related to frame or wood houses and you must protect yourself against them.It is important to understand that the age of the house is of relative importance to your homeowner's insurance company. Older houses are simply a pain to have because they require more fixing and they are not as durable as new ones. New houses also may qualify for discounts that are not given to old properties.Another thing that may affect the price of your policy is the amount of safety features you have in your home. Just know that prevention will save you money. The more fire alarms, smoke detectors and sprinklers you put in your home the less the cost of your policy. Also, if you don't have a security alarm then is would be good for you to install one. The reason for this is that it will make your family safe and will protect your possessions.Is Replacement Cost The Same As The Home's Market Value?This is a question that many people have at the time of buying a homeowners insurance policy in the state of Illinois. The answer to this question will always be a "NO". The reason for this is that the replacement cost that you have in your homeowner insurance policy will simply cover the value for fixing the structure and not the land. The market value of the home includes everything including land. Although it is important to understand that some people decide to have an appraisal on the value of the land and add it to their property.What Is An Umbrella Policy?Another important question that many people have when it comes to homeowners insurance has to be that of what companies call the "umbrella coverage". A reason why this is so confusing is simply because a lot of people don't understand the liability section in their home insurance policies. An umbrella policy will simply offer liability coverage above and beyond that one given in the liability section of a normal policy. It is not uncommon for people that want to be protected to the top to purchase an estimated one million dollars in an umbrella policy.What Are Some Common Illinois Homeowners Insurance Riders?Like in any other insurance industry, the Illinois homeowners insurance business does offer their customers riders that they can purchase in addition to their normal policies. Below you will find some of the main riders provided and a brief explanation of them.Personal Property Floater: This option is simply created for the people that have more personal possessions than what the home insurance company is willing to pay for. Excess jewelry, furniture and electronics can be hard to replace. For this reason the company will pay more than the stated amount for personal possessions if you add this rider to the policy.Income Property: This rider was specifically designed for the people that have a business renting out a property. It will simply allow you to insure the property you are renting under the main homeowner insurance policy that you have for your home.Secondary Residence Premises Endorsement: This is just like the coverage mentioned above, except that the other property being insured under the primary policy would be a vacation home or a second home that your family might have somewhere else.Theft Coverage Protection Endorsement: Most insurance companies have specific amounts that they will cover due to theft. With this rider a person will simply have the freedom to be paid more in the event that someone goes in an steals your possessions. This is a good rider to have if you don't have a security device in your home and you live in a big city (because big cities have a higher crime rate than rural areas).