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Think homeowner insurance costs too much? Here are some things that drive up prices

With homeowner insurance rates on the upswing in Florida, it pays to know what insurance companies look at when setting your rates. Too many negative factors can add hundreds of dollars to your annual cost of coverage. See common drivers of insurance costs below, based on information from property insurance information organizations. 

Dogs with bad reputations
Many insurers charge higher rates for homes with animal breeds seen as risky, while some refuse to insure homes with potentially dangerous dogs. Risky breeds include Dobermans, rottweilers, pit bulls and their variations, Great Danes, Siberian huskies, Akitas, and others. Exotic pets such as monkeys can also trigger higher rates.

Marital status
Married couples file fewer claims than singles and are seen by insurance companies as possibly more mature and less risky, according to Insurance.com.

Low credit score
The list of homeowner insurance companies that check customers' credit grows every year as carriers decide they are accurate predictors of who is most likely to file claims. They figure policyholders with poor credit don't manage their finances well and are less likely to properly maintain their homes. And like cars with owners that let mechanical problems pile up, serious and expensive repair issues are more likely to occur in neglected homes.

Proximity to water
Homes near an ocean, lake, river or canal are generally more expensive to insure due to the risk of flooding. Flood insurance, required for most homes with mortgages, can be much more expensive than properties further inland. That's not likely to change anytime soon, as the Federal Emergency Management Agency is gradually increasing federally backed flood insurance rates to help repay $23 billion in debt. In addition, homes built near coastline are considered more vulnerable to hurricanes, particularly in Florida and along the Gulf Coast, making wind coverage more expensive. 

Distance from fire stations
Homes located near permanently staffed fire stations cost less to insure. Most homeowner insurance companies offer discounts based on proximity to fire stations, and even fire hydrants.

Swimming pools
Although it's rare for people to drive cars into them, swimming pools can be lethal. Children ages 1 to 4 have the highest drowning rates, and 390 children up to age 14 died in pools, on average, every year between 2011 and 2013, according to the U.S. Consumer Product Safety Commission. A swimming pool owner is liable for anyone who uses it, whether or not they have permission.

Trampolines
Like swimming pools, trampolines are considered attractive nuisances, and many companies exclude them from coverage or decline to cover homes with them. Getting a trampoline in the middle of a coverage term could make the home ineligible for renewal. Policies that do cover trampolines extend liability only to users outside the household, according to ValuePenguin.com. Household members who get injured have to rely on the family's health insurance or pay fro treatment out of pocket.

Too many claims
Similiar to how credit history checks tell lenders about your repayment habits, insurance scores can tell carriers how many claims you have filed over time, or even how many claims have been filed for a home you just bought. More claims often mean higher rates, and in fraud-prone South Florida, insurers can refuse to write new policies in zip codes with records of high-volume claims activities.

Neighborhood crime
Insurers find policyholders in high-crime areas file more of certain types of claims, such as theft, and charge more in those areas.

Hurricane protections
The amount of protection from hurricane-force winds within a home can mean the difference of hundreds, or even thousands of dollars in annual premium. Florida's building codes have undergone numerous changes since Hurricane Andrew came ashore with 165-mph winds in 1992, leveling more than 125,000 homes. Protections mandated for all new construction included impact-resistant windows and additional support for roofs and all doors, including garage doors. Retrofitting can bring insurance costs down, but older homes lacking current protections are the most expensive to insure.

Poor maintenance
Poorly maintained homes can trigger insurance rate hikes or outright cancelations. Failing to perform regular maintenance can also trigger a claim denial. One insurer defended a water damage claim denial by arguing the homeowner should have taken his floor apart to inspect deteriorating pipes.

View the original article here: http://www.sun-sentinel.com/business/realestate/sfl-common-homeowner-insurance-cost-factors-20170425-photogallery.html




Posted Monday, May 01 2017 10:00 AM
Tags : Insurance

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