Beach-side condos are hot real estate in sunny, warm states such as Florida. They are no different from traditional houses in that they are considered home. They are also no different in that condos in Florida need home owner insurance quotes, too. Before you start looking for a home owner insurance quote in Florida, read up on some facts about purchasing home owner insurance for condos.

Choose a home owner insurance company and agent that specialize in insurance for condos. Home owner insurance policies for condos in Florida are different from home owner insurance policies for traditional houses; there are special factors to consider and coverage to purchase. There are also different add-ons and endorsements available. An agent that knows the ins and outs of home owner insurance policies for condos is crucial in purchasing the best policy for yourself and your condo.

Know what kinds of home owner insurance policies you will be purchasing for your condo. When you purchase home owner insurance in Florida, you will need to get a quote for the insurance that will cover you and your belongings, as well as the insurance that will cover the areas you share with other residents at the condo complex. These are usually called master policies, and specific information about your particular master policy is obtained from the condo board.

Understand what you will be responsible for. Living in a condo means that any common areas in the complex are just as much your responsibility as they are the responsibility of your neighbors. Additional Florida home owner insurance coverage for your condo such as unit assessment coverage will cover the expenses you will incur when helping to repair common area damage such as hallway fires.

Before you purchase your condo, talk with the condo board about home owner insurance quotes in Florida regarding condos. The board will provide you with information, and perhaps even make insurance company suggestions.

New Jersey homeowners insurance policies are policies that include property, liability, theft and medical payments coverages. Standard types of insurance coverages on your home offer protection against the financial loss you might suffer if any of the following events occur:

• Property coverage
  • Fire, windstorm, hail, tornados, vandalism, smoke damage and other physical damage to your home or belongings
  • Theft of your personal property
• Liability coverage
  • Someone gets injured on your property due to your negligence or that of a member of your family. Liability coverage also provides protection when somebody else's property is damaged as a result of your negligence. If someone is injured at your home, your insurer will reimburse you for immediate necessary medical expenses, generally up to a limit of $500 or $1,000. Examples of the types of expenses that would be paid are transportation to a hospital or doctor's office or a doctor's bill for necessary first aid. You should check your policy for specific details about this coverage.

HO-3 The most widely used policy

The Homeowners-3 (HO-3) or Special Form Policy has become the standard new jersey homeowners insurance policy. This policy covers your home for all risks of physical loss, except those that are specifically excluded, such as flood, earthquake, war, nuclear accident, etc. Check your policy for a complete listing of the excluded perils. Coverage for loss of your home's contents is also covered for many of the same perils for which your home is covered.

HO-5 Adds personal possession coverage 

The Homeowners-5 (HO-5) policy or Comprehensive Form Policy protects your home against the same perils as the HO-3 policy. In addition, your personal possessions would also be covered for all risks of physical loss, except those risks that are specifically excluded. This extra protection may also be provided by purchasing a HO-3 policy with the "Special Personal Property" endorsement for new jersey homeowners insurance.

HO-4 Tenants or Renters 

The homeowners-4 (HO-4) policy or renters policy protects your personal and family possessions against many causes of financial loss, including fire and theft. It also provides the same type of liability coverages as a standard homeowner's policy. You can add replacement cost coverage to further protect your possessions for new jersey homeowners insurance.

HO-6 Condominium Owners 

The homeowners -6 (HO-6) policy protects your personal and family possessions against many causes of financial loss, including fire and theft. It also provides the same type of liability coverages as a standard homeowner's policy. The HO-6 provides coverage for additions and alterations for such items as appliances, fixtures and alterations. It also provides Loss Assessment coverage in the event you are assessed by the association for a covered peril. 

HOW TO INSURE YOUR HOME AND PERSONAL BELONGINGS

When you insure your home, you are really insuring two distinct things -- 

1. The structure of your home
2. Your personal belongings

The structure of your home

Two ways to insure the structure of your home for new jersey homeowners insurance:

• Replacement cost - Insurance that pays the policyholder the cost of replacing the damaged property without deduction for depreciation, but limited to a maximum dollar amount.
• Actual cash value - Insurance under which the policyholder receives an amount equal to the replacement value of damaged property minus an allowance for depreciation. Unless a homeowners policy specifies that property is covered for its replacement value, the coverage is for actual cash value.

If you have an older home...

You should insure your home for the total amount it would cost to rebuild your home if it were destroyed. If you don't have sufficient insurance, your insurance company may only pay a portion of the cost of replacing or repairing damaged items. Here are a couple of tips to help make sure you have enough new jersey homeowners insurance: 

For a quick estimate of the amount to rebuild your home - multiply the local building costs per square foot by the total square footage of your house. To find out the building rates in your area, consult your local builders association. 

Most insurance companies will do an inspection to calculate the replacement value of your home.

Factors that will determine the cost to rebuild your home: 

1. local construction costs
2. the square footage of the structure
3. the type of exterior wall construction -- frame, masonry (brick or stone) or veneer 
4. the style of the house (ranch, colonial) 
5. the number of bathrooms and other rooms 
6. the type of roof
7. attached garages, fireplaces, exterior trim and other special features like arched windows

Check the value of your insurance policy against rising local building costs each year. Ask your insurance agent or company representative about adding an "inflation guard clause" to your policy. This automatically adjusts the dwelling limit when you renew your policy to reflect current construction costs in your area in your new jersey homeowners insurance policy.

Check the latest building codes in your community. Building codes require structures to be constructed to minimum standards. If your home is severely damaged, you might have to rebuild it to comply with the new standards requiring a change in design or building materials. These changes could cost more. Generally, homeowners insurance policies (even a guaranteed replacement cost policy) won't pay for this extra expense. However, some companies offer an endorsement that pays a specified amount toward these costs. (An endorsement is a form attached to an insurance policy that changes what the policy covers.) 

Do not insure your home for the market value. The cost of rebuilding your house may be higher (or lower) than the price you paid for it or the price you could sell it for today. 

Some banks require you to buy new jersey homeowners insurance to cover the amount of your mortgage. Make sure it's also enough to cover the cost of rebuilding. 

Increase the limit of your policy if you make improvements or additions to your home. 

YOUR PERSONAL BELONGINGS

Two ways to insure your personal belongings:

• Replacement cost coverage - Insurance that pays the dollar amount needed to replace damaged personal property with items of like kind or quality without deduction for depreciation.
• Actual cash value - Insurance under which the policyholder receives an amount equal to the replacement value of damaged property minus depreciation. Unless a homeowners policy specifies that property is covered for its replacement value, the coverage is for actual cash value.

Here are a few other things to keep in mind when you are insuring your personal property in your new jersey homeowners insurance policy:

1. Check the limits on personal items, such as jewelry, silverware, furs and computer equipment. If the limits are too low, consider buying a special personal property "endorsement" or "floater." An endorsement is an addition to your policy. A floater is a form of insurance that allows you to insure valuable items separately. 
2. Make an inventory of everything you own in your home and in other buildings on the property, except your car which must be insured separately. Write down the major items you own along with all available information: 
   1. serial number
   2. make and/or model number
   3. purchase prices
   4. present value
   5. date of purchase
3. Don't forget to include indoor and outdoor furniture, appliances, stereos, computers and other electronic equipment, hobby materials and recreational equipment, china, linens, silverware and kitchen equipment, jewelry and clothing. 
4. Take either still or video pictures of these items. Attach receipts to the inventory when available. Store the inventory and visual records away from your home - perhaps in a safe deposit box. 
5. Add major purchases to the inventory and a visual record soon after the purchase. 

FREQUENTLY ASKED QUESTIONS ABOUT new jersey homeowners insurance

For consistency, it is assumed that you have a policy known as Homeowners-3 (HO-3), the most common homeowners policy in the United States. Check with your agent to see if that's what you have. If you have a more restrictive policy, review your options under the last question and talk to your insurance representative.

• Q. Are you covered for direct losses due to fire, lightning, tornadoes, wind storms, hail, explosions, smoke, vandalism and theft?
• A. Yes. The HO-3 provides broad coverage for a large number of perils, including all those listed above, subject to your policy limit.

Action

Check the dollar limits of insurance in your policy. Make sure you are comfortable with the amount of insurance you have for specific items. For example, the standard policy provides only $1,000 for theft of jewelry. If your jewelry is worth a lot more, you should purchase higher limits. You may wish to add a floater to your policy to cover specific possessions, such as expensive paintings or silverware. The floater will provide both higher limits and protect you from additional risks, not covered in your standard policy.

Also, if you live on the Atlantic or Gulf coasts there may be some restrictions on your coverage for wind damage. Check this out with your agent.

• Q. Your house is totally destroyed in a fire. You purchased $150,000 worth of insurance to cover the structure of your house. Will this be enough to rebuild your home?
• A. If the cost of rebuilding your home is equal to or less than $150,000 you would have enough coverage. The HO-3 policy pays for structural damage on a replacement cost basis. If the cost of replacing your home is, say, $120,000, then that is all the insurance you need. On the other hand if the cost of rebuilding your home is $180,000, then you will be short $30,000. If you choose not to replace your home, you will receive the replacement cost of your home, less depreciation. This is called actual cash value.

Action

Make sure that the amount of insurance you have will cover the cost of rebuilding your house. You can find out what this cost is by talking to your insurance representative or builders in your area.

Do not use the price of your house as the basis for the amount of insurance you purchase. The market price of your house includes the value of the land on which the house is situated. In almost all cases, the land will be still there after a disaster, so you do not need to insure it. You only need to insure the structure.

• Q. Are you covered for flood? 
• A. No.

Action

Flood insurance is provided by the federal government, under a program run by the Federal Insurance Administration. If you are in a flood prone area it may be wise to purchase flood insurance. In some parts of the country, homes can be damaged or destroyed by mudslides. This risk is also covered under flood policies. Contact your agent or company representative to get this insurance.

• Q. A pipe bursts and water flows all over your floors. Are you covered?
• A. Yes. The HO-3 covers you for accidental discharge of water from a plumbing system.

Action

Check your plumbing and heating systems once a year. While you are covered for damage, who needs the mess and hassle?

• Q. Water seeps into your basement from the ground. Are you covered? 
• A. No. Water seepage is excluded under the HO-3. And if the water seepage is not due to a flood you will not be covered under a flood policy. Problems like seepage are viewed as maintenance issues and are not covered by insurance. 

Action

You should see a contractor about water-proofing your basement.

• Q. Are you covered for earthquake damage?
• A. No.

Action

Earthquake coverage is sold as additional coverage to the new jersey homeowners insurance policy. To determine whether you should purchase this insurance, talk to your agent or company representative. In earthquake prone areas, the price of this insurance is relatively high. In other areas, it is relatively inexpensive.

• Q. A neighbor slips on your sidewalk and threatens to take you to court for damages. Does your policy protect you?
• A. Yes. The policy will pay for damages, if the accident is the result of your negligence. It will also pay for the legal costs of defending you against a claim. Also, the medical payments part of your homeowners policy will cover medical expenses arising from an injury to a neighbor or guest.

Action

Check to see how much liability protection you have. The standard amount is $100,000. If you feel you need more, consider purchasing higher limits. The cost for higher limits is nominal.

• Q. During a storm, a tree falls and damages your roof. Are you covered?
• A. Yes. You are covered for the damage to your roof. You are also covered for the removal of the tree, up to a $500 limit.

Action

Cut down dead or dying trees close to your house. Prune branches that are near your house. It's true that your insurance covers damage, but falling trees and branches can also injure your family.

• Q. During a storm, a tree falls and does no damage to your property. Are you covered for the cost of removing the tree?
• A. Your trees and shrubs are covered for losses due to risks like vandalism, theft and fire, but not wind damage.

Action

Decide if you need extra insurance for the trees, plants and shrubs on your property. You may be able to purchase extra insurance, which will not only cover the cost of removal of fallen trees, but will also cover the cost of replacing trees, and other plants. Talk to your insurance representative about the availability and cost of this extra insurance.

• Q. During a storm, the power from the electric utility is lost. All the food in your refrigerator is spoiled and must be thrown out. Can you make a claim?
• A. The general answer is no. However, there are a number of exceptions. In some states, food spoilage is covered under the new jersey homeowners insurance policy. In addition, if the power loss is due to a break in a power line on or close to your property, you may be covered.

Action

Check with your agent to determine whether you are covered for food spoilage in your state. If not, you can add food spoilage coverage to your policy for an additional premium.

• Q. Your golf clubs are stolen from the trunk of your car. Can you recover?
• A. Yes. The HO-3 covers your personal property while it is anywhere in the world. However, if your golf clubs are old, you will only get their current value. This normally will not be enough to purchase a new set. 

Action

Consider purchasing a replacement cost endorsement for your personal property. This way you will get the full cost of replacing the golf clubs, less the applicable deductible.

• Q. You have a power boat with a 50 horsepower engine. If it is stolen, are you covered? What if there is a boating accident and you get sued? Are you covered?
• A. If the boat is stolen from your residence, in most cases, you can recover only $1,000. If the boat is stolen elsewhere you are not covered. 

You are also not covered for liability arising from an accident with the boat. The new jersey homeowners insurance policy provides liability coverage for boats with engines less than 25 horsepower.

Action

See your insurance representative about getting extra coverage for your boat, including theft and liability. Ask about the Boat owners policy.

• Q. Your house is close to the ocean. You have heard that if your house is destroyed by the wind, the town's new building code requires that you rebuild the house on stilts. This will cost $30,000, in addition to the cost of rebuilding your house. Are you covered for this extra cost?
• A. No. The HO-3 excludes costs caused by ordinance or laws regulating the construction of buildings.

Action

Purchase the Law and Ordinance endorsement. This will cover the extra costs involved in meeting new building codes. Not all insurance companies offer this coverage.

• Q. Am I covered for an "Act of God"?
• A. Yes. Normally, you are covered for "Acts of God". The term "Act of God" usually refers to natural disasters like hurricanes and tornadoes, as opposed to man-made acts, like thefts or auto accidents. Most natural disasters, with the notable exceptions of floods and earthquakes, are covered under normal insurance.

 

• Q. Does your policy provide less coverage than the HO-3?
• A. If the answer is yes, review your coverage with your agent. Some older policies provide less coverage than the HO-3. They may not provide coverage for water damage, theft, or liability. They may also provide coverage for the house on an Actual Cash Value basis, rather than a replacement cost basis. Actual Cash Value means replacement cost less depreciation. For example, if your roof is destroyed in a storm, the insurance will only pay the cost of a new roof less the amount of depreciation of the old roof. If your roof was in great shape, this deduction will not be large. However, if the roof was old and worn out, the deduction for depreciation may be large.

Action

Try to get an HO-3. Community-based groups, like Neighborhood Housing Services, can help you get such insurance. 

TEN WAYS TO SAVE MONEY ON YOUR new jersey homeowners insurance

The price you pay for your homeowners insurance can vary by hundreds of dollars depending on the company you buy your policy from. 

Companies offer several types of discounts, but they don't offer the same discount or the same amount of discounts in all states. That's why you should ask your agent or company representative about any discounts available to you. 

Here are 10 steps you can take to help you save money on your 

new jersey homeowners insurance: 

1. Shop around
   
   Friends, family, the phone book and Internet are some of the sources you can use to find homeowners insurers. Get a wide range of prices from several companies.
   
   But don't consider price alone. The insurer you select should offer both a fair price and excellent service. Quality service may cost a bit more, but you buy insurance in case you need to make a claim, so it's important to get a company with a good reputation. Talk to a number of insurers to get a feeling for the type of service they give. Ask them what they would do to lower your costs. 
   
2. Raise your deductible 
   
   Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to pay. Deductibles on new jersey homeowners insurance policies typically start at $250.  
   
   Increase your deductible to:
   $ 500 -- save up to 12 percent
   $1,000 -- save up to 24 percent
   $2,500 -- save up to 30 percent
   $5,000 -- save up to 37 percent

   Depending on your insurance company.

    

3. Buy your home and auto policies from the same insurer.  Some companies that sell homeowners, auto and liability coverage will take 5 to 15 percent off your premium if you buy two or more policies from them. 
   

4. When you buy a home:

   Consider how much insuring it will cost. 

   A new home's electrical, heating and plumbing systems and overall structure are likely to be in better shape than those of an older house. Insurers may offer you a discount of 8 to 15 percent if your house is new. 

   Check the home's construction:

   On the East Coast, Brick construction is favorable because of its resistance to wind damage.

   On the West Coast, Frame construction is favorable because of its resistance to earthquake damage. 

   Choosing wisely could cut your premium by 5 to 15 percent. 

   Avoiding areas that are prone to floods can save you about $400 a year for flood insurance. new jersey homeowners insurance does not cover flood-related damage. 

    

5. Insure your house, not the land.
   The land under your house isn't at risk from theft, windstorm, fire and the other perils covered in your new jersey homeowners insurance policy. So don't include its value in deciding how much homeowners insurance to buy. If you do, you'll pay a higher premium than you should. 
   
6. Improve your home security and safety
   You can usually get discounts of at least 2 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 station or other monitoring facility. These systems aren't cheap and not every system qualifies for the discount. Before you buy such a system, find out what kind of discounts are available. 

    

7. Stop smoking
     Smoking accounts for more than 23,000 residential fires a year. That's why some insurers offer to reduce premiums if all the residents in a house don't smoke. 

    

8. Seek out discounts for seniors 
   Retired people stay at home more and spot fires sooner than working people and have more time for maintaining their homes. If you're at least 55 years old and retired, you may qualify for a discount of up to 10 percent at some companies. 

    

9. Stay with an insurer
   If you've kept your coverage with the same company for several years, you may receive special consideration. Several insurers will reduce their premiums by 5 percent if you stay with them for 3 to 5 years; by 10 percent if you remain a policyholder for 6 years or more.

   Some companies offer loss free credits.

    

10. Look for private insurance first If you live in a high-risk area 
    --- one that is especially vulnerable to coastal storms, fires, or crime 
    --- and have been buying your new jersey homeowners insurance through a government plan, you should check with an insurance agent or company representative. You may find that there are steps you can take that would allow you to buy insurance at a lower price in the private market.

 

HOME SECURITY

Nine out of ten household burglaries are preventable

A burglar's three worst enemies -- light, time and noise! 

A burglar won't find your home an "easy mark" if he or she is forced to work in the light, if he or she has to take a lot of time breaking in, and if he or she can't break in without making a lot of noise.

Case your place

Take the time to "case" your house or apartment, just as a burglar would.

Where is the easiest entry? How can you make it more burglar resistant?

Trim trees and shrubs near your doors and windows, and think carefully before installing a high, wooden fence around your back yard. High fences and shrubbery can add to your privacy, but privacy is a burglar's asset. Consider trading a little extra privacy for a bit of added security. 

Force any would-be burglar to confront a real enemy -- light. Exterior lights, mounted out of easy reach, can reduce the darkness a burglar finds comforting.

Research shows that if it takes more than four or five minutes to break in to your home, the burglar will go elsewhere.

Simple security devices -- nails, screws, padlocks, door and window locks, grates, bars and bolts -- can increase the amount of time it takes to break into your home. This could discourage intruders and keep them from entering.

Try to make the general prospect of robbing your home a noisy job. Consider investing in a burglar alarm. The most effective ones also ring at an outside service. 

Are any of your valuables - paintings, a silver collection or a computer easy to see from outside? Rearranging your furnishings might be advisable if it makes your home less inviting to criminals.

SIMPLE SECURITY STEPS

1. Doors
   
   Make sure you have strong doors. Outside doors should be metal or solid hardwood, and at least 1 3/4 inches thick. Frames must be made of equally strong material, and each door must fit its frame securely. Even the most efficient lock, if it is placed in a weak door, will not keep out a determined burglar.
   
   A peephole or a wide-angle viewer in the door is safer for identifying visitors than a door chain.
   
   Sliding glass doors present a special problem because they are easy to open, but there are locks designed for them. A broomstick in the door channel can help, but don't depend on it for security.
   
2. Locks
   
   Deadbolt locks are best. They usually are locked with a key from the outside and a thumb turn on the inside. The cylinder (where the key is inserted) should be pick-resistant. Ask your hardware dealer for a reputable brand, or buy your locks from a locksmith.
   
3. Windows
   
   Key locks are available for all types of windows. Double-hung windows can be secured simply by "pinning" the upper and lower frames together with a nail, which can be removed from the inside.
   
   For windows at street level or on fire escapes, consider installing metal accordion gates.

Discounts

Most insurance companies provide 2 to 15 percent discounts for devices that make a home safer -- dead-bolt locks, window grates, bars and smoke/fire/burglar alarms.

When improving the security of your home, it is also important not to exchange security for personal safety. Don't make your home such a fortress that you are unable to escape in case of a fire or other emergency.

HOME SECURITY HABITS

1. Establish a routine to follow in making certain that doors and windows are locked and alarm systems are turned on. 
2. Avoid giving information to unidentified telephone callers, or announcing your personal plans in want ads or public notices (such as giving your address when advertising items for sale). 
3. Notify police if you see suspicious strangers in your area. 
4. Handle your keys carefully. Don't carry house keys on a key ring bearing your home address or leave house keys with your car in a commercial parking lot. 
5. Don't hide your keys in "secret" places outside your home - burglars usually know where to look. 

VACATION TIPS

1. Leave blinds open in their usual position. 
2. Have mail and packages picked up, forwarded or held by the post office. 
3. Lower the sound of your telephone ringer and answering machine so they can't be heard outside. 
4. Arrange to have your lawn mowed or your walk shoveled. 
5. Stop newspaper deliveries. 
6. Ask a friend to pick up "throwaway" newspapers and circulars. 
7. Use automatic timers to turn lights on and off in your living room and bedrooms at appropriate times. Consider connecting a radio to a timer. 
8. Tell police and dependable neighbors when you plan to be away and join with your neighbors to keep a close watch on what's happening in your area - working closely with them is a good way to prevent crime. 

INSURANCE NEEDS WHEN YOU REMODEL YOUR HOME

Before the first nail is hammered, you should check with your insurance representative to make sure your home, the contractor and the subcontractors have adequate insurance coverage. 

Addition to your home

Don't make the mistake of waiting until an addition or extra room is completed to increase the insurance coverage on the structure of your home. If the new addition is destroyed or damaged before insurance coverage has been increased, you may be responsible for the cost of repairing or rebuilding the addition. 

We suggest that you contact your insurance agent or representative before or shortly after the construction begins to increase the insurance coverage on your house to reflect the increase in the cost to rebuild the structure.

Contractors and subcontractors

When hiring a general contractor, you need to make sure that the contractor has workers compensation. Workers compensation pays for medical and rehabilitation expenses, and lost wages if the workers sustain injuries on the job. Injured workers may sue you if the contractor does not have proper insurance. 

In most home improvement projects, the contractor subcontracts the builders, electricians and plumbers. The workers hired may not be full-time employees of the contractor and therefore not covered under the contractor's workers compensation policy. While some independent builders, electricians and plumbers may carry their own workers compensation coverage, others may not. 

You should verify the insurance coverage of the contractor and the subcontractors. If the coverage is insufficient, you may need to fill in the gaps by extending the limits of the liability portion of your new jersey homeowners insurance policy. 

FILING A CLAIM

This is a brief overview of the claims filing process. If your home has been burglarized or damaged by fire or natural disaster, more information is available.

A homeowners insurance policy is a contract between you and your insurance company. You should understand the policy before a loss occurs. Review your policy with your insurance representative so you'll know what's covered. 

FILING YOUR CLAIM 

1. Report any burglary or theft to police. 
   
2. Phone your agent or company immediately. Insurance policies place a time limit on filing claims. Ask questions: Am I covered? Does my claim exceed my deductible? Your deductible is the amount of loss you agree to pay yourself when you buy a policy. How long will it take to process my claim? Will I need to obtain estimates for repairs to structural damage? 
   
3. Make temporary repairs and take other steps to protect your property from further damage. Save receipts for what you spend and submit them to your insurance company for reimbursement. 
   
4. Prepare a list of lost or damaged articles. 
   
5. Save receipts from any additional living expenses you incur if your home is so severely damaged that you have to find other accommodations while repairs are being made. Most new jersey homeowners insurance policies include a provision for reimbursement of these expenses. 
   
6. Get claim forms. Once your insurance company has been notified of your claim, the company is required to send you the necessary claim forms to you by the end of a specified time period. (The time period varies from state to state.) Return the properly filled out forms as soon as possible. 
   
7. Have an adjuster inspect the damage to your home. Your insurance company will probably arrange for the adjuster. 

SETTLING YOUR CLAIM

Once you and your insurance company agree on the terms of the settlement, the law requires that you be sent payment promptly. Unless there are problems with your claim, it will be processed quickly. 

If you are unsatisfied with you claim, follow these steps: 

1. Talk to your agent or the claims manager at your insurance company. Explain your side of the matter. Provide copies of supporting documents. Also, send a letter and documents to the claims executive at the insurance company's headquarters whose address is usually found on the first page of the policy. 
   
2. Call the National Insurance Consumer Help line. If after hearing from your insurance company's claims executive, you still feel your claim hasn't been handled properly, call 1-800-942-4242. It is a toll-free consumer information telephone service sponsored by the insurance industry. Trained personnel and licensed agents are available to assist consumers who have complaints. The Help line operates Monday - Friday, 8:00 a.m. - 8:00 p.m. ET. 
   
3. Contact your state insurance department. Explain the reasons for the disagreement to a consumer services representative at the department. He or she will discuss the matter with your insurer and help to resolve any difference so the claim can be settled. 
   
4. Consult an attorney. The American Bar Association notes that many situations involving legal matters can be handled by consumers on their own, without a lawyer. If you do hire an attorney, provide them with a copy of your insurance policy and all other relevant documents. If the insurance company has made a settlement offer, tell your attorney about it and ask if he or she believes that a lawsuit will help you get a larger settlement. Attorneys usually work on an hourly rate, but with cases involving injuries, they generally work on a contingency basis. Get the attorney's fee structure in writing before you decide to pursue the case. You can remain current on the progress of your claim by insisting that you receive copies from your attorney of all correspondence involving your case. Your attorney must have your agreement before committing to any settlement. 

REVIEWING YOUR POLICY

After your claim has been settled, take time to re-evaluate your homeowners insurance coverage to make sure you have adequate protection.

DO YOU NEED FLOOD INSURANCE?

Flooding is not covered by a standard new jersey homeowners insurance policy.

To determine if you need flood insurance, ask your insurance professional, mortgage company or neighbors about the flood history in your area. If there is a potential for flooding, you should consider purchasing a policy that covers the structure and your personal belongings. 

Flood insurance can be purchased from an insurance agent or company under contract with the Federal Insurance Administration (FIA), part of the Federal Emergency Management Agency (FEMA). Flood insurance is only available where the local government has adopted adequate flood plain management regulations under the National Flood Insurance Program (NFIP). Flood insurance is available even if you are not located in a flood zone.

Most Americans live or work in areas that have some risk of flooding. Flooding is caused by a number of conditions including hurricanes and severe storms, overflowing rivers or tidal waters, heavy rain, mudslides, levee failure and snowmelt. About 90 percent of natural disasters involve flooding in one way or another. Unfortunately, many people still don't understand the importance of flood insurance. An overwhelming majority of residents who were flood victims in 1997 were not covered for their flood exposure.

• new jersey homeowners insurance does not cover flood damage. Only flood insurance will cover your losses in the event of a flood. Insurance for homeowners, renters and businesses is available through the federal government.
• Floods and flash floods occur within all 50 states. Almost everyone is vulnerable to floods, no matter where they live. In fact, the National Flood Insurance Program says that one out of four flood claims come from outside flood risk areas.
• Flood insurance policies can be purchased from licensed brokers. Flood insurance is available through the Federal Emergency Management Agency's (FEMA) National Flood Insurance Program (NFIP). It is sold via the more than 80 participating insurance companies that write and service policies through a special arrangement with the Federal Insurance Association (FIA), as well as through thousands of insurance agents nationwide. Contact your insurance agent for details or call the NFIP at 1-800-638-6620.
• Don't wait to obtain a flood insurance policy. If your community participates in the National Flood Insurance Program, you are eligible to purchase flood insurance through the NFIP. Remember that there is a 30-day waiting period before your coverage takes effect, so don't delay.
• Flood insurance coverage. The maximum coverage amounts are $250,000 for a home and $100,000 for its contents. Maximum coverage for businesses is $500,000 for buildings and $500,00 for contents. Separate deductibles apply for building and contents. Flood insurance does not cover personal property located in a basement.
• Disaster aid is only available in federally declared disaster areas. Before most forms of federal disaster assistance are offered, the President must declare the area a major disaster -- and less than 10% of all disasters are declared by the President. Flood insurance claims are paid even if the President does not declare a disaster.
• Relief from floods primarily comes in the form of loans. If your area is declared a disaster, no-interest or low interest loans are usually made available by the federal government. But these loans are just that - loans -- and must be paid back. Obtaining a flood insurance policy is the only way to truly protect yourself from the cost of flooding disasters.

RENTERS INSURANCE

What if you came home from work only to find your apartment had been totally trashed by a burglar? Or what if you walked into your living room and found yourself standing in a 3 inch flood of water? Well, if you think it's not a major problem because your landlord will foot the bill, YOU'RE WRONG. 

Your landlord's insurance does NOT cover your personal property. Things like your clothes, stereo, furniture, television, bicycle, jewelry, personal computer, artwork and other items are not covered by your landlord's insurance against destruction or loss. As sorry as your landlord may be about the 3 inches of water in your living room or your stolen stereo, you're the one who'll have to buy a new couch and stereo system, not him. 

Renters insurance covers your personal property and:

• protects you against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm, and water damage from plumbing. 
• covers your responsibility to other people injured at your home or elsewhere by you, a family member or your pet and includes legal defense costs if you are taken to court. 

COMMON QUESTIONS

• Q. Does renters insurance cover all my personal property ?
• A. It depends. Some things like - jewelry and computers - often have a per-category limit (for example, some policies have a $5,000 limit for computers). For these things you may want to buy a floater, this provides additional coverage for specific items not included in your basic policy.

 

• Q. If I file a claim, will my policy be canceled?
• A. If you didn't cause the loss or damage, your insurance shouldn't be affected. If you were at fault -- if you caused a fire by smoking in bed for example -- the insurance company might consider this when setting the price for your next policy.

 

• Q. Is my personal property covered away from home?
• A. Yes, but coverage amounts vary from 10% of your personal property coverage to the full value.

• Q. As a student, am I covered by my parents' policy?
• A. If you are a college student under the age of 26, and your parents have a homeowners or renters insurance policy, their insurance might give you limited coverage in the dorm, but not if you live in an apartment.

• Q. Can I purchase a renters policy with my roommates?
• A. Yes, but the regulations might be different from state to state, and the policies might also be different from company to company. Find out what regulations apply in your state and then shop around to find an insurance company that can help your situation. Each roommate's name should be included on the policy.

• Q. What about unmarried couples?
• A. Some insurance companies now allow unmarried couples who have been living together to obtain joint coverage, rather than two separate policies. Each person's name should appear on the policy.

• Q. What happens if my rented or borrowed items are stolen?
• A. Items that are "in your possession" are covered under a standard renter's policy.

• Q. What if my insurance company doesn't respond to a claim?
• A. Your state insurance department or local consumer protection office can answer questions on filing claims and also take complaints. 

• Q. Is my bike or car covered by renters insurance?
• A. Your bike is covered, but vehicles aren't. You need to get a separate auto insurance policy to protect your car, van or motorcycle.

How do you determine the amount of coverage you need?

1. Take An Inventory: 
   
   Make a list of everything in your apartment. Record model numbers, serial numbers, date of purchase and price of item. Take photographs or make a video of these items.
   
   Give one inventory to your insurance agent, and keep another for yourself.
   
   Keep your inventory and visual record of your things outside of the apartment maybe in a safe deposit box or at the office.
   
2. Ask About: 
   
   Theft Limits - For example, most renters policies have a $1,000 total limit on jewelry that is stolen, a $3,000 - $10,000 limit for computers. Ask for a list of standard coverage limits so you know whether you'll need to get additional coverage for your personal property .
   
   Cash Or Replacement Value - Your policy can insure your personal property in one of two ways--either for the cash value or the replacement cost. 
   
   Cash value coverage takes into account the age and condition of items at the time of damage or loss. You would be reimbursed for the value of the item minus depreciation. 
   
   Replacement value pays today's cost for an item of similar kind or quality.
   
   Deductible Options - Find out about the deductible or your out-of-pocket cost. Keep in mind that raising your deductible will usually lower your premium.
   
3. Discounts:
   
   Insurance companies frequently offer discounts to their auto policyholders interested in buying a renters policy from them. You can also get discounts if your apartment or home has a security system, smoke detectors, or deadbolt locks. More discounts might be available depending on your age or whether you're a non-smoker.
   
4. Shop Around:
   
   Look on the Internet, ask friends or relatives or flip through the yellow pages to find the agent that is right for you. Call a variety of insurance companies and agents and ask a lot of questions. Keep your inventory handy, so you can find the amount of coverage that is most appropriate for you. The minimum limit is generally $25,000.
   
5. Review Your Policy:
   
   Review your policy with your insurance professional so that you understand what's covered. For example, flooding is not a covered peril in a renters insurance policy.
   
   However, if you live in a flood prone area, you may want to consider purchasing a flood insurance policy.

INSURANCE TIPS FOR CO-OP/CONDO OWNERS 

You will need two separate policies to protect your investment. 

Your own insurance policy. This would provide coverage for your personal possessions, structural improvements to your apartment and additional living expenses if you are the victim of fire, theft or other disaster listed in your policy. You would also get liability protection.

A "master policy" provided by the condo/co-op board. This would cover the common areas you share with others in your building like the roof, basement, elevator, boiler and walkways for both liability and physical damage. 

To adequately insure your apartment, it is important to know what structural part of your home is covered by the condo/co-op association and what is not. You can do this by

reading your association's bylaws and/or proprietary lease. If you have questions, talk to your condo association, insurance professional or family attorney. 

Sometimes the association is responsible for insuring the individual condo or co-op units, as they were originally built, including standard fixtures. The individual owner, in this case, would only be responsible for alterations to the original structure of the apartment, like remodeling the kitchen or bathtub. Sometimes this includes not only improvements you make, but those made by previous owners.

In other situations, the condo/co-op association is responsible only for insuring the bare walls, floor and ceiling. The owner must insure kitchen cabinets, built-in appliances, plumbing, wiring, bathroom fixtures etc.

Also ask your insurance professional about the following additional coverages:

Unit Assessment : This would reimburse you for your share of an assessment charged to all unit owners as a result of a covered loss. For instance, if there was a fire in the lobby and all the unit owners were charged the cost of repairing the loss, this type of insurance would provide coverage.

Water back-up : Insures your contents for damage by the back-up of sewers or drains.

Umbrella Liability: This is an inexpensive way to get more liability protection and broader coverage than what is in a standard condo/co-op policy. You may feel more comfortable with this additional protection.

Flood or earthquake: If you live in an area prone to these disasters, you will need an additional policy since standard new jersey homeowners policies do not include either flood or earthquake coverage.

Floater or endorsement: If you own expensive jewelry, furs or collectibles, you might consider getting additional coverage since there are specific dollar limits for these types of high ticket items. For instance, there is generally a $1,000 limit for theft of jewelry. 

When purchasing insurance, it is important to find an agent or company that specializes in condominiums or co-ops. Also don't forget to ask about all available discounts. You can reduce your rates by raising your deductible and by installing a smoke and fire alarm system that rings at an outside service. If you insure your unit with the same company that underwrites your building's insurance policy, you might also get an additional reduction in premium. 

Brief Introduction to Insurance
   Property insurance is one of the nation's basic business institutions. Directly or indirectly, it affects every individual and every business in the land. It has become a part of the very fabric of American civilization and culture and is virtually indispensable to our present economic system.
   The reason for any type of insurance lies in the simple fact that the most certain thing confronting individuals and institutions is uncertainty. No one can escape constant exposure to a variety of perils. Each day we face the possibility that something unexpected may disturb the normal routine of our living. High winds may damage our homes. Burglars may steal valuable possessions. We may be hospitalized by serious accidents. Fire may destroy our personal belongings, automobiles, or clothes. The problem of dealing with these constant perils and their potential damage is one of the most important factors of modern living.
Group vs. Individual Perils.
   We all face two major types of perils - group perils and individual perils. Group perils are those over which we have practically no control. A terrorist attack and its consequences, for example, present a group peril that may affect all of us seriously, but there is little that we, as individuals, can do about it. Nor can we do anything to prevent windstorms, dust storms, droughts, hurricanes, or wildfires.
   Individual perils are essentially personal. As individuals, we have some degree of control over their origin. For instance, the peril of loss as a result of fire is an individual peril. By observing simple fire prevention rules, a property owner can do much to reduce and control fire hazards, whether inside or outside the home.
Peril of Fire.
   Consider the constant peril of fire, for example. Whether we consider the familiar fire that destroys a single home or the widespread event of a wildfire that may destroy hundreds of homes, the central question remains: What can a person do about this peril?
   The answer lies in one of three possibilities: First, an individual might choose to do nothing. But that could prove to be a costly gamble and would be evading the problem, not solving it.
   Second, he or she might decide to create and build up a savings fund to prepare for the financial shock of a possible fire loss. In the 21st century, this can mean a sizeable amount of cash reserves, and this method might be satisfactory if no immediate loss occurred. But there is no guarantee that a property owner will be so fortunate. Even if it were possible to establish an adequate financial reserve, the individual would probably be handicapped by having to keep his savings tied up in this way.
   Third, the problem can be most appropriately handled through a third alternative - a combination of risk analysis and insurance protection. The individual could proceed to handle the perils to his property in the following manner:
 1. Survey Risks. The individual can survey the risks to which he or she is exposed. "Is there a chance of loss from fire, wildfire, windstorm, hail, explosion, and so forth?" This survey should determine every chance of a major loss.
 2. Reduce/Eliminate Causes. The risks surveyed and appraised, he/she can reduce or eliminate the obvious causes of loss. For example, if the property owner has been careless in handling flammable materials, he/she can reduce the risk of disastrous fire from the cause by installing special containers in which to store paints, volatile oils, and similar products. (Naturally, one should not stop after eliminating such an obvious cause of loss but should continue to seek out and remove every possible fire hazard on his property.)
 3. Buy Fire Insurance. Even after the property owner has appraised the risks, has reduced some, and eliminated others, there remains an irreducible minimum of risk over which he/she has no control. The individual, for example, has no control over a fire that originates in the neighbor's home and spreads throughout the community. Thus, since the chance of loss due to fire can never be eliminated completely, a third step in dealing with perils to property becomes necessary.
 4. Transfer Risk. The individual can transfer the remaining chance of loss to a professional risk-bearer - an insurance company - by purchasing a fire insurance policy.
    The operations that make it possible for an insurance company to transform this piece of paper called a policy into payments of money when losses occur represent one of the more interesting aspects of public expectations and assumptions about insurance.
How Insurance Premiums Are Determined.
   The most important element to the policyholder is the security behind his policies. Therefore, the use to which a company puts the money it receives is vital to every property owner seeking protection.
   The amount of the premium is determined by multiplying the amount of insurance involved by the appropriate rate. An insurance rate is the cost of a unit of insurance and the unit of insurance generally used in property insurance is a standard amount of protection for a period of one year (e.g., $100, $1,000, $10,000). 
   Briefly, the underlying factor is loss expectancy. Estimates of loss expectancy start with three fundamentals:
1. Previous experience in handling similar risks.
2. The kind of building material used and the type of construction involved, the occupancy and the hazards associated with occupancy
3. The extent and efficiency of public (i.e., fire department) and private fire protection services (i.e., fire sprinklers, fire extinguishers, smoke alarms), including the adequacy of the community's water supply.
   The use to which a building may serve, its proximity to other buildings from which fires might spread, and a number of other factors also have a considerable bearing on insurance rates. Climatic and other characteristics also vary between states. Rates in each territory are generally established by special organizations that have had long years of experience in studying just such problems.
   Money received by the company is employed in various ways. First, of course, losses incurred under policies issued by the company must be met. Many types of taxes and fees must be set aside for federal, state and municipal authorities. In addition, there are the expenses for fire prevention activities, property surveys, and the maintenance of the engineering and rating organizations.
   The nature of the insurance business and the laws of several states require that companies establish several reserve funds with which to meet unforeseen as well as expected events.
Law of Large Numbers.
   The foundation upon which insurance rests is the law of large numbers, also known as the law of averages. Experience has shown that a certain number out of a given group of properties will probably be destroyed by fire and other perils. The larger the group of individual properties exposed to the chance of loss, the greater the accuracy with which the approximate number of future losses can be predicted.
   This principle can be demonstrated by the simple operation of tossing a penny into the air. If you flip long enough, the result will be an equal number of "heads" and "tails." If you try only ten times, the result is likely to be much less accurate than if you try a hundred or a thousand times. However, at no time during your experiment will you be able to predict definitely that either a "head" or a "tail" will appear on any given toss.
   Similarly, in property insurance, no one can predict which property will be destroyed. But insurance professionals know from experience that if they issue policies covering a large enough group of properties, they can estimate closely the number and amount of losses they will normally pay. Thus, they are able to cover losses and operating costs. This fact explains why an insurance company can promise to pay a relatively large sum of money in the event of a loss although the policyholder has paid only a comparatively small amount to the company for taking the risk.
   The tools that might allow a cost-benefit analysis as a result of a calculable mathematical probability of wildfire event and damage are unavailable. The reason is the lack of long term and insufficient data. If wildfire disasters were a numerous and severe as hurricane disasters, for example, the insurance companies would be adjusting rates based on location, values at risk, probabilities and extent of loss relative to pre-disaster mitigation measures, and other analyses.
   Insurance can be defined as the simple means by which individuals can transfer their chances of loss to a professional risk-bearing organization. Insurance substitutes for the uncertain cost of a possible loss; the certain small cost of protection against loss.
   The development of property insurance industry which today helps to safeguard lives and property, has been gradual and progressive. The system through which insurance companies must work may be complex but the system, regulated by state insurance commissions, the Federal Trade Commission, and the insurance companies themselves, helps the consumer obtain the best insurance product for the money. The system also helps insurance companies provide accurate assessments of risk and prevent fraudulent claims that affect all the policyholders.
Role of Reinsurance.
   A simplified example may help illustrate how reinsurance helps insurance companies balance their risks through the role of reinsurance companies.
   Perhaps an insurance company's new customer application report calls for fire insurance totaling $500,000 on a building in a block where the company has already assumed a high amount of risk. Sound judgment may dictate that the company write no more than $250,000 on the new risk. Does this mean that the agent has to cancel the first policy for $500,000 and write two new policies for $250,000 each in separate companies?
   Ordinarily, no; for the company can usually reinsure any portion of risk it does not care to retain for itself. Just as insurance is the arrangement by which an individual transfers his risk to a company, reinsurance is the device by which one company transfers to one or more companies a part of the risks it has assumed. To provide for prompt and convenient handling of such risks, nearly all companies maintain reinsurance agreements with other organizations. Some organizations are set up solely as reinsurance companies, handling risks transferred to them from other companies rather than from individual property owners.
   Reinsurance thus represents an added measure of protection from policyholders. It reduces each company's liability for loss on any particular risk and is a graphic illustration of the principle of distribution of liability. In case of loss, the reinsurance does not affect the details of handling the claim settlement, which is the full responsibility of the company whose policy is held by the property owner.
Interface Fire Losses May Not Provide Viable Incentives Adjusting Rates.
   For the insurance companies, the numbers and frequency of losses are not big enough to provide valid data for analysis (mathematical probability and loss expectations), especially in large areas in which many properties are insured by many companies.  When one company does bear the risk of losing every home in an area, the risks and subsequent losses are shared by all the customers. In some cases, individual premium increases may never be applied or be insignificant (fractions of pennies on each dollar of insurance).
   Each insurance company offering coverage must have each product approved by the state's insurance commission. If a company sought higher premiums for residences in wildfire prone areas (or conversely, lower rates for those who installed mitigation), the process of establishing possible rates and mathematically "testing" those rates (internal process to the company), proposing new individual rates based on zoning, and getting those new rates approved by the state is a daunting process for a savings that may never materialize for the company. In addition, agents and underwriters would be required to perform much more background and inspection work for individual policies, thus writing fewer policies each year. Either case results in financial impacts to the company.
Insurance Premiums May Not Prove a Viable Incentive for Homeowners.
   First, understanding and applying Firewise mitigation on private property is the responsibility of the property owner. A homeowner's lack of attention to hazardous conditions in a wildfire area (or other hazardous location) should be no one's responsibility except that homeowner. If the expectancy is that fire fighters will arrive in sufficient time and number with a sufficient quantity of hose, water, and equipment to protect one's structure when as many as 100 or more structures are burning, the interface resident would be well advised to understand how the management procedures and resources are best deployed during widespread interface fires.
   The use of fire fighters, who are professionally trained to perform specific duties of suppression and rescue during a wide range of emergencies, should not be expected to run around every house in a subdivision of hundreds of houses moving or removing combustible brooms. lawn furniture, firewood, and other materials that would reduce the ignition potential "just in time" before the flames or firebrands reach the house.
   Second, the widespread notion that financial incentives of reduced premiums will encourage interface homeowners to apply Firewise mitigation measures voluntarily is weak. The assumption that premium savings may be the key to encouraging change prove false when, in reality, the savings may be insignificant or even non-existent.
   As an example of how this assumption is faulty, assume that an insurance company agreed to provide a 50% reduction in the individual fire insurance for replacing an aging wood roof with a new non-combustible one. The fire insurance on the house in question may be as little $80.00 per year, since most of the premium paid by the homeowner covers liability and replacement values of structural components. A new noncombustible roof may cost $6,000. So with a 50% reduction ($40.00 per year), the cost of the new roof will be recovered in mere 150 years! Therefore, the homeowner finds that the roof will need yet another replacement long before any significant payback on the new roof occurs. To further illustrate the point (and frustrate the homeowner), property insurance is based on replacement values of the home (or its parts), and the premiums might actually increase to cover more expensive building materials or assemblies of the roof.
   Even if the highly anticipated premium reduction were significant enough to encourage structural changes, the increased value of the home would not likely escape the notice of tax assessors and the increased local property taxes (based increased values) could exceed any premium reduction.
    Third, insurance companies may drop or refuse to write policies based on perceived risk. Of this aspect, there are two possibilities. One is that companies may not write policies based on the location of the property. If the company has data (and lots of it) to prove its case, they may well succeed in excluding entire areas or portions of areas from their potential coverage. Otherwise, the practice may be looked upon as red-lining, an illegal practice that has historically been used to reduce the insured risk due to socio-economic factors and not actuarial data.
   The other possibility is that companies may choose not to renew current policies for dwellings with their risk class, as those policies expire. In that case, other insurance companies in a better position to accept more risk would likely step in write the policy (with a premium adjustment, of course).
   What if all the insurance companies in the state decided to discontinue writing homeowner policies in interface areas? In this case, state FAIR plans can offer insurance to the seemingly uninsurable. Even if insurance companies drop coverage because of location of the home (wildfire-prone area, earthquake zone, flood plain, etc.), many states have FAIR (Fair Access to Insurance Regulations) that will provide the homeowner with property insurance, at a much more expensive rate, of course, based on the risk and probability of loss. The irony is that the FAIR plans are funded by the insurance companies that have been approved to do business in the state.
   Last but not least, homeowners with homes in interface areas would be wise to realize that policies commonly refer to claims for losses being settled on an "actual class value" basis. Look into the loss-settlement provisions of the policy. The problem is that, among many insurance professionals, the definition of actual cash value is unclear.[2]
   Following precedents established in two recent court cases dealing with insurance settlements, several state insurance commissions have begun to hone the definition of actual cash value and require that the definition be placed into the provisions of policies. In an effort to establish a standard for "actual cash value" and to clarify questions like: Is actual cash value and market value the same amount? What about depreciation of the lost or damaged item? What get depreciated? Can labor and overhead along with the actual materials be included? What else might be included in depreciation?
   Whatever the final definition may be (and include as depreciable) may mean that the homeowner receives less than anticipated much less need to replace the home and contents. This is still one more reason to reduce the possibilities of a wildfire igniting the home through Firewise mitigation.

Imagine discovering your homeowners insurance is canceled while you are in the middle of selling your house to relocate. Or, imagine a situation where your job requires frequent travel and your insurance company pulls the plug on your insurance because it says your home is "unoccupied."

Insurance Superintendent Eric Dinallo today acted to protect consumers who find themselves in situations like these. He advised insurance companies that canceling a homeowners policy only on the basis that a dwelling is unoccupied is an illegal mid-term cancellation.

Diallo urged consumers encountering this issue to contact the Insurance Department. He said insurance companies must reinstate the policies of affected consumers. The action could potentially affect financially-pressed consumers involved in forfeitures.

"Consumers should know that the Insurance Department will act vigorously to protect homeowners. This includes homeowners who may be involved in forfeiture proceedings, which have increased because of the troubled economy. Insurance companies need to understand that the Insurance Law protects all homeowners from improper non-occupancy cancellations," Dinallo said.

"The fact that an insured individual is not occupying a home is not a legitimate reason, in and of itself, for canceling a homeowners policy. It is improper to cancel a homeowners policy simply because a property owner may be away from home because of a situation like an illness," he said.

After receiving numerous consumer complaints from across the state, the Insurance Department issued an advisory, known as a "circular letter," to the insurance industry. The advisory instructs insurers to stop the improper cancellations. Circular Letter # 23 (2008) is available on the Department's website, http://www.ins.state.ny.us/circltr/2008/cl08_23.pdf .

The situation of a Suffolk County woman is typical of the complaints. The woman's insurance company told her that her policy was being canceled because her home was unoccupied. But she explained that she was in the middle of trying to sell her home and relocate to the Albany area to take a new job. She said that either she or her parents were at the home every weekend and that a neighbor also looked after the property. The home was furnished and the utilities were still connected.

Other consumers registering complaints included a Syracuse couple confined to a nursing home, a flight attendant whose job required frequent travel, and a Plattsburgh man who was forced out of his home after it was extensively damaged when a neighbor's tree fell onto it.

In each of these cases, insurers wrongly advised consumers that their policies were being canceled because their homes were unoccupied, therefore increasing the risk to their homes.

The Insurance Department's advisory to insurers could help consumers who become temporarily displaced as the result of pending foreclosure proceedings.

Insurers may consider non-occupancy if it is among other factors that increase the risk to a property. It may not be considered as the sole factor in a mid-term cancellation.

Under the law, a homeowners policy must remain in effect, or be renewed, for three years from the date the policy first becomes effective. Cancellations or non-renewals during the three years are only permitted for certain specific reasons. These include non-payment of premium, as well as fraud or misrepresentations in obtaining policies or filing claims. Cancellations or non-renewals are also permitted when policyholders recklessly increase hazards to property or make physical changes that result in a property becoming uninsurable.

Insurers that have improperly canceled or non-renewed policies must offer to reinstate them, effective from the dates of termination. These offers must maintain the premium rates in effect at the time of the cancellations or non-renewals.

Consumers who believe their homeowners policies have been improperly canceled based on non-occupancy are urged to contact the Insurance Department. They may do so by calling toll-free 1-800-342-3736, between 9 a.m. and 5 p.m., Monday through Friday. Complaints may also be filed online at anytime by accessing the Department's website, www.ins.state.ny.us.

Under the present law in New York State, an insurance company may cancel your homeowners or tenants policy by issuing a cancellation notice during the first 60 days it is in effect as long as the cancellation notice states the specific reason or reasons for the cancellation.

After your policy has been in effect for 60 days it may not be cancelled or nonrenewed for a three year period, except for the following reasons:

1. nonpayment of premium (however, if payment is received by the company within 15 days of the mailing of the cancellation notice the policy will not be cancelled)
2. conviction of a crime arising out of acts increasing the hazard insured against;
3. discovery of fraud or material misrepresentation in obtaining the policy or in the presentation of a claim under the policy;
4. discovery of willful or reckless acts of omissions increasing the hazard insured against;
5. physical changes in the property insured occurring after issuance or last annual anniversary date of the policy which result in the property becoming uninsurable in accordance with the insurance company's objective, uniformly applied underwriting standards in effect at the time the policy was issued or last voluntarily renewed; or
6. a determination by the Superintendent of Insurance that the continuation of the policy would violate or would place the insurer in violation of the Insurance Law.

At the end of this three year period, your company may refuse to renew your policy, however, by law, they are required to provide at least 45 days, but not more than 60 days notice of nonrenewal.

When insurance policies are sold they are issued on either a monoline basis or as a package policy. A monoline policy contains only one type of coverages, such as liability insurance, while a package policy includes several different types of coverage, such as property insurance and liability insurance. A package policy is generally less expensive than insurance coverages purchased separately. Homeowners and tenants policies are package policies that include property, liability, theft and medical payments coverages.

Standard types of insurance coverages on your home or apartment offer protection against the financial loss you might suffer if any of the following events occur:

1. fire, windstorm, hail, tornadoes, vandalism, smoke damage and other physical damage to your home or belongings;
2. theft of your personal property;
3. someone gets injured on your property due to your negligence or that of a member of your family; or somebody else's property is damaged as a result of your negligence.

The events described in C. above would be covered under the liability portion of your policy.

Several basic types of homeowners and tenants policies are currently sold in New York State . The policies range from a basic package up to more comprehensive packages which, of course, are more expensive, but do provide greater coverage against more perils for both your home and possessions. Five different types of policies are available to provide coverage for owners who occupy one or two family houses; a sixth covers tenants of a house or apartment building or cooperative owners; and a seventh provides coverage for condominium owners.

It is important to be aware of the different perils (causes of loss) that are insured against in each type of policy. We are providing a comparison of the coverage offered under each of the policies described above. It is up to you to determine whether you need the most extensive type of coverage or whether your insurance needs can be met with a basic policy. Some of the coverage excluded under a policy, such as earthquake damage and power interruption, can be "bought back" for an additional premium. Correspondingly, some coverages listed under a policy can be excluded, such as off-premises theft, resulting in a reduction in premium. However, some coverage, such as flood insurance, are always excluded and the only way to obtain them is through Federal insurance programs which will be explained further in this guide. Be advised that some insurers may use trade names for their insurance products and do not label their policy forms as follows:

The Homeowners-1 (HO-1) policy or Basic Policy insures your home and contents against listed perils (see graphics on page 3). Very few insurers sell this type of policy;most offer more comprehensive policies, such as the Homeowners-3, that include these and other perils.

• Fire, Lightning and Smoke Damage
• Windstorm and Hail
• Burglary and Theft
• Explosion
• Glass Breakage
• Vehicle or Aircraft Damage
• Riot and Civil Commotion
• Vandalism and Malicious Mischief
• Bodily Injury
• Damage to Property of Others
• Civil Judgments
• Medical Payments
• Personal Property (at Home)
• Personal Property (Away)
• Additional Living Expense (If forced to live away from home temporarily)

The Homeowners-2 (HO-2) policy or Broad Form Policy, insures your home and contents against the perils in the HO-1 policy or Basic Policy and other additional listed perils such as falling objects; weight of ice, snow and sleet; damage resulting from an accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning or automatic fire sprinkler system.

The following additional perils are covered under an HO-2 Policy:

• Falling Objects
• Weight of Ice or Snow
• Water from Plumbing Systems
• Freezing of Plumbing Systems
• Electrical Damage to Appliances
• Rupture of Water Heaters and Heating Systems

The Homeowners-3 (HO-3) or Special Form Policy is the most widely used policy by homeowners writers today. It is becoming the standard homeowners policy and many lending institutions recommend buying it. This policy covers your home for all risks of physical loss, except those that are specifically excluded, such as flood, earthquake, war, nuclear accident, etc. Check your policy for a complete listing of the excluded perils. Coverage for loss of your home's contents is also covered for many of the same perils for which your home is covered.

The Homeowners-5 (HO-5) policy or Comprehensive Form Policy protects your home against the same perils as the HO-3 policy. In addition, your personal possessions would also be covered for all risks of physical loss, except those risks that are specifically excluded. This extra protection may also be provided by purchasing a HO-3 policy with the "Special Personal Property" endorsement.

In addition, the Homeowners-8 (HO-8) or Market Value Policy is a modified version of the HO-1 policy or Basic Policy, providing actual cash value coverage in place of replacement cost coverage for a building. In no event will the company's settlement figure exceed the amount necessary to repair or replace the dwelling. This policy form is generally used when the replacement value of the property exceeds its market value, as in the case of older homes which are considered "white elephants".

Contents Broad Form or Tenants Policies (HO-4) and Unit Owners Policies (HO-6) are policies that insure against damage to the contents of the apartment, cooperative or condominium and for personal liability of the insured when people are injured or suffer property damage in the insured unit.

It is not necessary for a tenant to insure the building in which he or she lives since that is the landlord's responsibility. The HO-6 policy does provide property coverage for any alterations, appliances, fixtures and improvements within the insured unit but condominium and cooperative buildings, and their common areas, should be insured through policies issued to the cooperative owners' and the condominium owners' associations.

Your homeowners and tenants policies will also reimburse you for increases in living expenses you have to pay when your home becomes uninhabitable because of damage caused by one of the covered perils. You must remember that not all living expenses will be reimbursed, only the difference between your normal living expenses and any additional living expenses. Examples of these types of expenses are hotel bills, restaurant bills, telephone bills, etc.

All of the above homeowners policies insure you for your personal liability when another person suffers bodily injury or property damage as a result of your negligence or the negligence of anyone who is an insured under your homeowners policy. Generally, you will also be protected if one of your pets injures anyone, however, if you have a dog which is considered a dangerous animal, such as a pit bull, the company may exclude coverage for that pet or write the coverage for an additional premium. This may also be true for exotic pets, such as snakes, spiders, amphibians, etc.

If an incident occurs at your home and someone is injured, your insurer will reimburse you for necessary medical expenses, generally up to a limit of $500 or $1,000. Examples of the types of expenses that would be paid are transportation to a hospital or doctor's office or a doctor's bill for necessary first aid. You should check your policy for specific details about this coverage.

The premiums charged for homeowners and tenants insurance vary widely from company to company, so it pays to take the time and effort to shop around in order to get the best value for your insurance dollar.

The cost of homeowners and tenants insurance depends on a number of factors including location; age and type of building; the use of the building, i.e., residence and/or commercial enterprise; local fire protection; choice of deductibles; application of discounts; and the scope and amount of insurance coverage you purchase.

A brick building, for example, is more resistant to fire than a frame building and, consequently, costs less to insure against fire. The building's location also has a bearing on the cost of fire coverage, because some communities have better fire protection than others. Also, some areas have greater crime and vandalism problems than others, which also affects the cost of insuring against such losses.

Territories

Each of New York City's five boroughs constitutes a separate rating territory for homeowners insurance. In the remainder of the State, rating territories are based upon the quality of the community's public fire protection, ranging from Class 1 (the best protection) to Class 10 (unprotected).

Deductibles

If your policy contains a standard all peril deductible, such as $250, you would collect the amount of any covered property loss, less $250. With a deductible, the premium cost of your policy is lower than if there were no deductible. In choosing the deductible amount, you bear the burden of loss up to the amount you feel you can afford. Deductibles save money because the first dollars of the insurance are the most expensive to buy. Contact your insurance company to see if they offer higher deductibles, such as $500 and $1,000, on your homeowners insurance coverage.

Hurricane deductibles discussed above are a relatively new feature in homeowners' policies. Insurers began offering or requiring hurricane deductibles following a series of catastrophes in the late 1980's and early 1990's, that caused major losses. The hurricane deductible is in addition to the standard all perils deductible contained in the homeowners policy.

Examine your policy carefully because many insurers require a hurricane deductible on homeowners policies depending on the location of the insured property. Most insurers who use these deductibles require them on insured properties located in Nassau and Suffolk counties and the five counties that make up New York City. In addition, several insurers require the deductible for the coastal areas of Westchester county.

A hurricane deductible is usually expressed as a percentage of the insured value of your house. The Department requires insurers to also express it as a dollar amount on the declarations page of any policy to which it is attached. For instance, if your home is insured for $150,000 and a mandatory 5% hurricane deductible is applied to your policy, you would be responsible for the first $7,500 of any loss as the result of a hurricane. If a hurricane causes $10,000 worth of property damage to your home you are responsible for the first $7,500 and the insurer is responsible for the remaining $2,500.

Credit Information

Over the past several years, insurers have also used consumer credit information, along with other information to decide whether to issue a homeowners or dwelling policy and how to price it. Under New York law, insurers that use credit information must adhere to the following consumer safeguards:

• If an insurer uses credit information in rating or underwriting a policy, they must send you a notice disclosing this fact, including the name of the credit reporting agency.
• If your premium is higher than it would be if you had a "better" credit score, you will receive a notice advising you of this fact. The notice will include an explanation of credit-related factors that affected your score.
• If there is an error in your credit report, you should contact the credit reporting agency to correct the report, and then inform your insurer or agent of the correction, as it may affect your premium and entitle you to a refund.
• Your insurer must review your current credit information at least once every 3 years, upon your request, unless it reviews updated credit information more frequently (e.g. annually) as part of their renewal process. When the company reviews the updated credit information, if your credit information has improved, you may be entitled to a lower premium, and the company must make any necessary adjustments at such time.
• Your company may not terminate your policy or increase your renewal premium based on credit information.

"Multi-Tiering"

Some insurers use "multi-tier" rating programs, in which more than one rate level can be established within the same company. Based upon their underwriting guidelines, insurers place insureds in rating "tiers" with others who have similar characteristics. Upon renewal, the experience and characteristics are re-evaluated to determine if the insured qualifies to move to a different tier.

Discounts

You should also check with your insurance company to see if they offer premium discounts for the use of dead bolt locks, smoke alarms, fire extinguishers, sprinkler systems and security systems. Insurers are required to offer premium discounts if a policyholder has installed hurricane/storm shutters and/or hurricane resistant laminated glass windows and doors. All of these devices minimize losses and in some instances, may deter them.

Some companies offer what is called a multi-policy discount. If you purchase your homeowners and automobile liability policies from the same insurer, you may receive a small discount. In addition, you can probably purchase a personal umbrella policy with liability limits of $1,000,000 or higher over your homeowners and automobile liability policies which might also be subject to a multi-policy discount.

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Before making purchasing an insurance policy, you should be aware of the types of products and coverages available in New York State. This Consumer Guide to Homeowners Insurance and other such publications can help enhance your understanding of the market.

You also need to know the types and limits of coverage you want to purchase. Do you want or need any additional coverages?

Check to make sure the insurer you are dealing with is licensed to sell homeowners insurance in New York State. If you are unsure of the licensing status of an insurer on the Web, check the Directory of Regulated Companies on the Insurance Department's Web site. In addition, you should only be dealing with licensed agents and brokers. If you are unsure whether an agent is licensed in New York, call or e-mail the agent and request his or her New York license number.

In seeking your rate quote, you will be presented with a series of questions. Make sure you answer these questions fully and accurately.

Shop service as well as price. Savvy insurance consumers know that sometimes the lowest price insurer isn't the best buy if an insurer is not responsive once claims arise.

Comparison Shopping

Comparison shopping makes sense and saves dollars. However, you should remember that price is only one of many factors to consider when selecting an insurance company. You should look at other factors such as insurance company claim practices, reliability, the services provided by agents, brokers or insurance companies, and the particular coverages the company offers to meet your individual needs.

There are over 200 insurance companies that write homeowners and tenants policies in New York. Many of these companies may charge premiums that compare favorably with those of the top 41 writers whose sample homeowners premiums are shown in Appendix A. Appendix B of this guide includes the telephone numbers of these companies that you may use to obtain information on the availability of insurance and on the filing of claims.

The price comparison tables shown in Appendix A show the homeowners and tenants insurance premiums charged by 41 of the top writers (by premium volume) in New York State. This information shows rates that were in effect as of April 1, 2007 for certain exposures for various rating territories in New York State. Your actual premium quote may differ significantly from the sample premiums based on a number of factors including location; age and type of building; the use of the building, local fire protection; choice of deductibles; application of discounts; and the scope and amount of insurance coverage you purchase. Only an insurance company or its authorized agent can tell you the exact cost for your policy.

The representative premiums shown in Appendix A are based on the following:

• The rates used are in effect as of April 1, 2007
• The premiums include off premises theft coverage
• The territories are ISO territories
• For New York City territories (ISO territories #3, 4, 5, 6, and 7), Protection Classification 1is used.
• For all other territories, Protection Class 8 is used.
• No discounts or surcharges are included.

The HO-2 and HO-3 homeowners policies reflect the premium for either a brick or frame dwelling insured for $200,000 with a $500 deductible, off-premises theft coverage, personal liability coverage in the amount of $200,000 and medical payments coverage of $1,000.

The HO-4 or tenants or cooperative apartment owners policy reflects the premium for either a brick or a frame dwelling with personal property coverage of $50,000, personal liability coverage in the amount of $200,000 and medical payments coverage of $1,000.

The HO-6 or condominium owners policy reflects the premium for an apartment in either a brick or frame dwelling insured for the amount of $15,000, personal property coverage of $50,000, personal liability coverage in the amount of $200,000 and medical payments of $1,000. The HO-4 and HO-6 tables also reflect premium charges that take into account the number of units in the building, one to four or more than four.

You should also read your policy carefully since the extent of coverage may differ somewhat from company to company. You should be aware of any co-insurance, the amount of deductibles and the types of exclusions contained in your policy. While you are shopping for insurance you may also find that some companies may include additional coverage without an additional premium, while others charge for every type of coverage added to the policy.

Buying Homeowners Insurance on the Internet

Although the Internet currently accounts for a relatively small percentage of total insurance sales, its influence in the marketplace is growing rapidly. Quoting agents are actively marketing their services to consumers via a growing number of Web sites. Quoting agents provide sample homeowners insurance rates to Internet users who respond to various online questions. In addition, many insurance companies and traditional agents and brokers have their own Web sites providing pricing, service information and, sometimes, the means to complete a homeowners insurance purchase. Appendix B has Web sites of insurers listed in the guide. The Insurance Department's Web site has a general listing of the Web sites of regulated insurance companies.

Remember, when you are applying for or purchasing insurance you are transmitting key financial and personal data to an insurer or agent. Make sure the Web site you are using is secure. Many Web sites will include their privacy and security policy on the site itself. For example, a Web site may be encrypting (coding) your private information to make it unreadable to third parties. The Web site will describe that process. In addition, you can activate your Web browser to notify you when you are entering or leaving a secure mode.

Over the next few years, Internet sales are expected to grow as competition intensifies in the electronic marketplace. New York State consumers should be aware that the Web can be a convenient means of comparing prices and/or purchasing homeowners insurance, but that it is not necessarily the best means for every consumer. Whether you use the Web or not, it pays to shop for homeowners insurance.

Evaluating Your Home and Personal Property

The first step in determining how much insurance you will need is to make an analysis of the value of your home (excluding the value of your land) and your personal property within it. In determining the value of your home, you must calculate how much it will cost to replace it if your home were totally destroyed. You can enlist the help of your insurance agent in determining this figure. In fact, most insurance companies make a physical inspection of your home when they first insure it. Using formulas that take into account whether your home is of brick or wood frame construction, total area, number of floors, number of rooms, etc., the company will be able to give you an accurate replacement cost value. In addition, although it would be expensive, you could also get an estimate from a contractor.

Determining the value of your personal property will require an extensive analysis on your part. You should go through each room of your house and list every piece of furniture and fixture within it. Some insurance companies provide Household Inventory Schedules which can be quite helpful with this task. Items such as sofas, tables, beds, TVs, refrigerators, and lawn mowers would be included in such a schedule.

As you compile your inventory you should supplement it with receipts indicating the purchase price and date of purchase and photographs of major items. Your inventory should be updated on an annual basis, or at the very least, whenever you purchase a large appliance or piece of furniture.

Some people periodically make a video of all their possessions. If you do, make sure all the drawers and/or doors of your furniture are open so you have a record of what is stored. It would also be helpful if you are able to verbally describe major items on the video. When complete, you should make a back up and store your inventory list or video in a safe place away from your home, such as your safe deposit box. You might also want to store this information in the home of a friend or relative or in your workplace.

Structure

Once you have determined the approximate worth of your home and its contents, in most cases, your homeowners insurance coverage will be on the home's replacement cost. Generally, if you purchase coverage on a replacement cost basis and insure your home for at least 80% of its replacement cost, your insurance will automatically be issued on a replacement cost basis. Then, when you suffer a loss, your insurer would pay you the amount it would cost to replace or repair your home without deducting anything for depreciation. Of course, this type of coverage is more expensive than actual cash value coverage.

If you do not insure you home for at least 80% of its replacement cost, you will not receive full payment of your loss as the following example illustrates:

Ms. Jones and Mr. Smith both own 15-year-old frame houses. The estimated replacement cost of each house is $100,000.

Ms. Jones is insured for $80,000 (80%) while Mr. Smith is insured for only $50,000 (50%).

Both homes suffer windstorm damage, which completely destroys both roofs. The cost to repair each roof is $5,000.

Since she was insured for at least 80% of her home's replacement cost, Ms. Jones will be fully reimbursed for her loss, less any deductible.

However, because Mr. Smith did not have at least 80% coverage, his insurer will pay the greater of the actual cash value of the roof or the proportion of the cost to repair the roof which the total amount of insurance bears to 80% of the replacement cost of the building. The second method of payment reflects a co-insurance penalty since Mr. Smith did not maintain adequate insurance.

Assuming that the 15-year-old roof has an expected useful life of 25 years, its actual cash value is only $2,000, computed as follows:

1 - (15(age of roof)) X $5,000 = $2,000

(25 (expected life))

However the proportional cost of repairing the roof would be computed as follows:

$50,000 (insured amount) X $5,000 = $3,125

$80,000 (80% of replacement cost)

After calculating these two formulas, Mr. Smith's insurer would pay him $3,125, the greater amount of $2,000 vs. $3,125.

The replacement cost of your home must be estimated at the time you take out a homeowners policy. In most cases, insurance companies will inspect your home and use formulas that take into account a house's construction, size, quality, location, nationally recognized construction indices and other factors to approximate its current replacement cost. As a result of the increase in the value of homes, insurance companies have become more active in evaluating the replacement cost of homes that they insure and often require periodic updates of that cost.

Contents

Coverage for contents is usually issued on an actual cash basis in homeowners and tenants policies. Your insurance company will determine any amount payable to you as a result of a covered loss by taking the current replacement cost of the contents and subtracting an amount for wear and tear and/or depreciation. It should be pointed out that there is no set formula for calculating depreciation. Not only may different insurers use different formulas, but various formulas may be used depending on the item that has been damaged. This means that you probably will not receive the full amount needed to replace or repair the property that has been damaged or stolen. However, some insurance companies may sell you an endorsement that provides replacement cost coverage for the contents of your home. Replacement cost coverage generally costs an additional 10% - 15%.

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