Property Insurance Requirements

Is a policy which provides financial reimbursement to the owner or renter of a structure for the structure and its contents, in the event fire vandalism or theft occurred to the policy holder. There are several types of property insurance consumer can shop for homeowners insurance, renters insurance, flood insurance and earthquake insurance.

Commercial property insurance protects commercial property for such perils as fire, theft and natural disaster. Such organizations but not to limit manufacturing, retailers, service-oriented business and not-for-profit organization use commercial property insurance. If the property is purchased other than cash, through a mortgage lender, it's mandatory to have homeowner's insurance policy in place prior to closing.

Homeowner's Insurance Policy is divided into 4 different categories:

1. Dwelling - The structure of the house
2. Other structure - such as fence, non-dwelling structure such as tool shed or detached garage
3. Personal property - Content within the home, between four walls, are personal property. This includes furniture, appliances and clothing. Not all items are covered under the insurance
4. Loss of use - Loss covered by peril and the dwelling becomes uninhabitable so the insurance the loss of additional living expense to maintain a normal standard of living

Other coverage options

1. Earthquakes - Not all property insurance company provide insurance coverage from loss of earthquakes. In most cases they do provide losses immediately relating to fire. Separate policy can be purchased to ensure coverage against loss from earthquake. Government mandated plans are available where earthquake coverage is hard to find
2. Flood - If the property is not listed in the flood zone most policies will exclude flood coverage. Unless the property is in the flood zone the flood coverage will be required
3. Hail - Most property insurance will cover loss from hail. Hail falls under the category of peril
4. Hurricanes - Majority of the policies provide coverage from loss of Hurricane except from loss resulting from hurricane. Separate policy can be purchased to ensure coverage against loss from hurricane. Government mandated plans are available where hurricane coverage is hard to find
5. Tornadoes - Majority of the property insurance policies provides coverage resulting from loss from tornadoes but does not cover flood damage immediately after the tornadoes. The coverage of tornadoes losses fall under the category of a broader definition windstorm
6. Wildfires - Majority of the property insurance policies provide coverage for loss resulting from fires. Depending on the geography of the property and exposure level risk insurance premium can be manageable with higher deductible
7. Lightning - Is this covered?

How much insurance is enough?

1. Replacement cost coverage - Cost of replacement valued at today's cost to repair or replace damaged possessions without deducting for depreciation
2. Actual Cash Value - is a method of valuing (computed) insured property. It does not equal to a replacement cost value. The cost of an item is computed by depreciating from replacement cost
3. Functional replacement cost - Method of replacing or substitute a building with commonly used and less costly construction methods to obtain equal functionality as to original construction of a building
4. Market value coverage - In theory, the cost of replacing the home will be market value. Market value defines the value of a house during the buying and selling transaction. However, the actual cost of also knows as replacement cost - the amount typically required and needed to rebuild in the event the home was damaged or destroyed to be far more greater than purchased price and last
5. Stated value - In the event of theft or total loss the insurance company will pay the stated value or the actual cash value, whichever is less

What is casualty insurance?

Casualty insurance is a broader category of coverage against loss of property, damages or liabilities. Casualty insurance not to limit but includes vehicle insurance, liability insurance, theft insurance and elevator insurance. For business workers compensation insurance would be covered when a worker is injured on the job. For homeowners and car owners it is important to have casualty insurance to protect against claims.

Property insurance rate varies on the geography and location of the property. Insurance rates are substantially lower than those property built decades ago. The advantage of owing a new built home is low maintenance, lower utility bills and ecofriendly to environment. Insurance policies can be obtained or residential as well as commercial policies, Homeowner's policies and DP3.

The DP3 insurance policy is referred to as an extension of policy on a residential building, usually rented to other. Another way to look at is DP3 is a landlord policy to the dwelling. The cost of the insurance policy may increase depending on the location from homeowner's policy.

If the property remains vacant for more than 30 days insurance policy bracket changes and policy insurance rate could be doubled. There are some company may refuse to cover abandonment or neglected properties. Notify your insurance agent either if you are selling your home or if it is vacant more than 30 days and landlord for non-vacancy downtime.

Buyer be-aware of avoiding higher policies / maintenance cost is while shopping for resale homes. Always ask your insurance agent while negotiating an offer with the seller to run a Clue report at least for 5 years if not more to see if the owner has damage claims on the property and if repair were made professionally.

Tenant insurance policy is known as rental insurance and it cover the personal belongings and protect you from unexpected damages and injuries.

It does not matter either you are holding a Homeowner's, landlord, commercial or rental insurance policy, the insurance companies are grouping common policies and giving greater discount to consumers by capturing greater chunk of a pie. Ask your local agent on how you can even save by combining home and casualty insurance together.

Shopping for insurance is never easy receiving and comparing insurance policy. Independent operated insurance firm shops around from best possible quotes with easy comparison. Whereas, captive insurance company self-administered and so consumers have to independently shop for the best possible rate on their own.

The study shown above is based on Dallas, Texas market. To determine what coverage is important and better fit your budget consult qualified local insurance companies in your neighborhood.