Everyone who owns a home needs insurance, but sometimes it can be confusing to know what exactly you need. If you are in the state of Florida, there are added types of insurance you may need to have to cover floods or hurricane damage. Also, sinkholes are becoming much more common, particularly in Florida. It is important to know what will affect your coverage and how, and you certainly need to know before attempting to file a claim. So, when is the best time to get Florida home insurance?
Who Needs Insurance?
Short answer: everyone. Good news though! Sometimes bundling insurance policies helps drive down the costs. Asking around for quotes can be extremely helpful, and we recommend getting one by itself plus one with other insurances added in to see if it helps lower the premium. Here are some examples of types of insurances that can be bundled:
- Recreational Vehicles
- Life (sometimes)
Unique Florida Home Insurance Situations
The official start of the hurricane season is June 1st, but that does not mean you should wait until then to review your coverage. Starting before you need to file a claim, you can review your current policy or look for better coverage before the first storm is announced. Some people assume that hurricanes are automatically covered by the minimum policy in Florida, but that is not the case. So carefully review your policy and ask questions if needed.
Although a common occurrence, floods are not automatically covered by insurance. Some companies do offer the coverage at additional cost, but it may be more than you expected. Keep in mind that flood insurance does not always cover mold either. So, while one may be taken care of, you could have bigger issues if you do not have appropriate coverage for both.
Again, Florida home insurance does not automatically sinkholes. If there is known sinkhole activity in the area, some companies may choose not to insure your home. They can have an inspection of your property done, so make sure you know what the risks are in your neighborhood.
Type of Home and Upgrades
The type of home you live in is also a factor in insurance coverage. A mobile home not on a foundation may suffer more catastrophic damage in a hurricane than a house that has been built to specifically withstand high-velocity wind and rain.
Likewise, changing out glass windows to shatterproof ones will increase their durability in a storm. Waterproofing as much of your home and exterior will also help prevent damage and allow it to last longer before replacement.
The Best Time to Get Florida Home Insurance
So, when should you update your insurance? What else should you keep in mind when looking for respectable Florida home insurance policies?
1. Your Policy Is Close to Renewal
You can review your policy a few weeks prior to any renewal. Policies change, and you may find yourself surprised at what has changed since you first signed up. Are you paying what you expect to be paying for the coverage? It never hurts to shop around and see if you can get a better rate, particularly if you have vehicles or other items to bundle in.
You can review your coverage at any time, but many people choose to review it when it’s close to their renewal so they can decide if they want to keep their current policy, make changes, or find a new carrier.
2. You Change Insurance Policies on Something Else
This can be as simple as getting a new vehicle and finding a different insurance provider. It never hurts to check and see what it would cost if you bundled, and you may save yourself some money in the long run. You can shop around and find the best rates and coverage. Likewise, if you downsize the number of vehicles you have, that can also have an effect on other policies. A car that is no longer garaged in your home can mean that your coverage needs are lower, for example.
3. Your Rates Increase
If your insurance rates have increased with your current company, there may be a reason, such as a recent claim you have made or increased crime rates in the neighborhood. However, if you cannot figure out a reason for the increase, it may be time to re-evaluate.
Rates change all the time, and sometimes increases can be due to circumstances outside of your control. You, however, can control whether to change your policy or keep it as it is.
4. A Life Change
You may have recently had a baby, or maybe someone moved out of your home. Various events can constitute a life change, which can affect your policy. Whenever this happens, you should evaluate your policy and see if the change can affect your coverage. Certain changes may even lower your rates. It is important to speak with your agent or company to ensure you have the appropriate level of coverage.
5. Home Improvements
Certain home improvements increase the value of your property. It is important to loop the insurance company in on any of those changes because otherwise, you may find yourself underinsured on the property. The worst time to discover this is when you need to make a claim on the brand-new kitchen you upgraded only to find out your policy only covered the old kitchen.
6. Property Value Changes
If the value of your property dramatically increases or lowers, you want to investigate your Florida home insurance to ensure you are properly covered. If the value raises over a certain amount, you typically need to go through a specialized insurance company.
7. You Become a Millionaire
If your net worth exceeds 1 million dollars, often you will need specialized insurance to cover any claims. Your insurance company should be able to advise you on the specifics, so if you are already close to the net worth limit, you may want to keep them in the loop.
What to Keep in Mind
Seek an Agent
There are plenty of great things in life that are “Do-it-Yourself.” Finding insurance should not be included in this category. There is a lot of jargon in the insurance world, and while there is a lot of readily available information on types of insurance coverage, you should find someone you can trust. Agents are required to be licensed and have regulations they must follow. They are there to answer your questions, so if you want to know more about hurricane coverage or fire coverage, they can walk you through step by step.
Quality Versus Price
While it is possible to get an excellent policy for a good price point, you want to make sure that you are getting what you need out of your insurance policy. It does no good to get a basement bargain deal if it misses a key component of what you need in a policy. Make sure you review what you are getting and keep shopping if it is not what you need. Sometimes, you really do get what you pay for, and you do not want to get coverage to replace a case of ramen when you really needed to replace an expensive couch.
Not you: them. Make sure the agency has the financial stability to pay a claim if you need to make one. When looking into Florida home insurance, some websites may list this information and some may not. Insurance companies buy insurance for themselves (called reinsurance) to make sure they can cover multiple claims in the event of a major event. (Like, for example, after a hurricane.) You may need to ask more in-depth questions of the company to make sure they have the financial capability to pay out large scale claims.
Watch for Exclusions
There no longer exists an “all-risk” policy, which would blanket cover any situation. There are simply too many factors to work through for this to be a good model for insurance companies to look at. Some loans or rental agencies have a minimum required level of insurance, but that does not mean it includes all the coverage you really need.
It is important to look through the options and make sure you can get the appropriate level of coverage for your family. Floods, both internal (a pipe bursts) or external (hurricane) can wreak havoc on your home. Add in the mold and it can be even worse than it appears at first glance.
Who Lives There?
If you have homeowner’s insurance and choose to rent out your property, you need to change your policy. If something were to happen, the insurance company may not cover a claim if your living situation is different than what has been filed with them. Risks change with different living situations, so it is imperative that you update your insurance carrier with any new information.
Do Not Underinsure
Sure, it is cheaper if your plan only covers $50,000 in damages. But then again, it also will only pay that amount in the event of a total loss. Make sure to be honest with your company, because if something catastrophic happens and you lose your entire home, you want to make sure you can replace the items within it. Keeping good records of inventory can also help, both in getting appropriate levels of coverage but also in the event of theft or loss.
Go with Replacement Cost
What does this mean? Well, typically, you have the option to replace an item at its “actual cost” or “replacement cost.” They sound the same but are, in fact, two vastly different things. We will explore the differences here.
This is whatever its current value is. If the couch you paid $1,500 for two years ago is currently worth $200, that is what will be covered. Depreciation of household items is as fast, if not faster, than vehicles or computers — it does not take long for an item to lose its value, particularly in an everyday use situation.
If it costs $2,000 to replace the couch, you get $2,000 to replace it. Of course, this is where good inventory comes into play. You want to be as accurate as possible and only replace what is appropriate to replace. If you had a $20 garage sale special futon, you should not use the claim to get an upgrade.
Insurance is complicated. What seems to be very surface level is more like an onion. There are many layers to the protection insurance provides, and you will be your own best ally when it comes to making sure you have what you need. There is never a bad time to find Florida home insurance policies. It can be compared to shopping around for the best deals at the supermarket; sometimes you can find good sales on good items. Sometimes you find meat that is about to spoil.
Why Absolute Choice Insurance?
We want you to be well protected. We want you to have the coverage you need so you can feel safe and confident in your home. Your friends and family are also important to us, and we want them to be covered if something happens. We have worked hard to lead the Florida residential insurance industry because we value our communities and want to continue building trust for many more years to come.
We want to provide Florida home insurance seekers with comprehensive knowledge and specialized coverage. We are proud to be part of LAAII (Latin American Association of Independent Agents) and have offices in both Kissimmee and Miami. If you are interested in a quote, contact Absolute Choice Insurance today!