Home Owner’s Insurance Simplified

What does my homeowner insurance policy cover?
The basic homeowners insurance policy covers you against losses which may occur as a result of the following incidents:-
* Hurricanes
* Earthquakes
* Fires
* Floods
* Storms
* Malicious Damage
* Lightning
It is important though, that when seeking homeowners insurance you request from the insurance company what coverage they provide under their policy.
What is not covered?
Read your homeowners insurance policy to find out exactly what is and is not covered. Do this before you suffer a loss, so you won’t be surprised. Most insurers exclude damages caused by an act of war, nuclear accident and terrorism.
Shop Around
No matter what type of insurance you’re buying, the process is essentially the same. Once you’ve decided what type of insurance and how much coverage you need, you can begin contacting insurance companies directly by phone, or through an insurance broker to obtain quotes. Get quotes from several different insurers because premium cost can vary widely.
Compare Coverage
You should not only compare prices but also coverage offered by various insurance companies. A policy might cost less because it offers fewer or different features and benefits. Ask the insurance agent or broker for brochures which will provide an outline on the coverage.

You should also ensure that the company you’ve settled on is reputable, with good customer service and claims-paying ability.
How long does the insurance company provide coverage?
Homeowners insurance policies are usually issued for a period of one year, for example say I insure my home on 7th June, 2005, the insurance will therefore expire on 6th June, 2006. It is important to note that if the insurance premium is not paid by 6th June, 2006, cover will cease to exist. If you suffer a loss after the expiry date and no premium has been paid the insurance company will not honour your claim.
What do I do if I suffer a loss?
It is of utmost importance that you make a note and where possible take photos of the damage. The other step you must immediately undertake is to inform your insurer or broker of the loss. If you report the loss by telephone you should personally visit your insurer and complete the relevant claim form and provide them with all necessary documentation.
The claims official at the insurance company will confirm if the loss is covered under your policy and if so, what procedures are involved in the claims process.
When you have a claim:
• Review your policy and notes
• Promptly notify the insurance company of the loss
• Do not exaggerate the claim
• Keep a log of all correspondence with the insurance company (especially telephone calls)
• Gather materials to prove your claim (e.g., photographs, statements from eye-witnesses, receipts)
• Always keep copies of any documents you give to the insurance company
• Get your own estimate of the loss
• Take all reasonable steps to minimize or reduce your loss.
What is Insurable Interest?
It simply means that the person seeking coverage must stand to suffer financial loss as a result of the property being damaged. A homeowner will obviously suffer financial loss if his or her home burns down. You cannot, however, purchase insurance on your neighbour’s house and collect in the event the house burns as you do not have an insurable interest.