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Homeowner Insurance. Objectives. Identify the types of insurance coverage and policies available to homeowners and renters Analyze the factors that influence the amount of coverage and cost of home insurance. Overview- What is it?. Insurance – Protection against possible financial loss.
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Objectives • Identify the types of insurance coverage and policies available to homeowners and renters • Analyze the factors that influence the amount of coverage and cost of home insurance
Overview- What is it? • Insurance – Protection against possible financial loss. • Provides protection against many risks, property, Illness, and injury • Policy - Contract made between the individual and insurance company. • Premium – A fee for insurance.
Homeowners insurance • Coverage that provides protection for your residence and its associated financial risks, such as damage to personal property and injuries to others • Home, building, or any other structures on the property • Additional living expenses • Personal property • Personal liability and related coverages • Specialized coverages
Key terms • Risk: The chance of loss or injury. (owning property-risk that it will be lost, stolen, damaged, or destroyed). • Peril: Event causing damage to your property (ex. fire, tornado, theft, or vandalism). • Hazard: Anything that increases the likelihood of loss through peril (ex. Defective electrical wiring in a house increase the chance of fire) • Negligence: Failure to take ordinary reasonable care to prevent accidents from happening. (ex. Not shoveling the front steps)
Personal property floater • Additional coverage that covers the damage or loss of a specific item of high value • Ex. Wedding rings
Types of Risk • Risk- The chance of loss or injury • Peril – Anything that may possibly cause a loss. • Hazard – Anything that increases the likelihood of loss through peril. • Negligence- The failure to take ordinary or reasonable care to prevent accidents from happening.
Home and Property Insurance • Homeowners Insurance – Coverage that provides protection for your residence. • Homeowners Policy: (covers the following) • The home, building, any structure on the property • Additional living expenses • Personal Property • Personal Liability and related coverage's • Specialized coverage's
Home and Property Insurance • Additional Living expenses – Covers if you cannot live in your home • Personal Property – Are covered up to a portion of the personal property (55, 70, 75%) • Recommend taking a HH inventory • Personal Property floater – Additional property insurance that covers the damage or loss of a specific item of high value. • Personal Liability Coverage- Protects you if others sue you from injuries they suffered on your property. • Most coverage is $100,000
Home Insurance Cost Factors • Location of the home • High crime, severe weather, and others affect the cost for home insurance. • Type of structure- Brick will usually cost less than wood (more durable). • Price, Coverage amount, policy type • How much you paid for the home; what is your total coverage amount • Your deductible will also affect your price.
Renters insurance • Covers: • Personal property – most important • Additional living expenses • Personal liability • Related coverages • Does not cover the building or other structures • Relatively inexpensive
Am I covered while at college? • Check with your insurer to see if your college student is covered by your policy. • http://www.normal.org/Gov/Fire/InAction/Phoenix.asp
Homework – due Friday • Do your parents have homeowners/renters insurance? • If so, find out what your homeowners insurance will cover while you are away at school. Specifically: • Who is your insurance company • What is covered • Amount of coverage • Does your college offer any protection in the dorms • If not, contact an insurance company to determine your options • Should be typed and at least ½ page.