Protecting Your Investment with Homeowner’s Insurance

By Leesa Sandoval | Mortgage

Jun 03

House insuranceProtecting Your Investment with Homeowner’s InsuranceProtecting Your Investment with Homeowner’s Insurance

Selecting, purchasing and maintaining homeowner’s insurance is a standard for anyone wishing to purchase or own a home. The problem tends to be with so many companies out there offering so many different options, how do you know what’s best for you?? Furthermore, as your needs change how do you determine if you have the best coverage? To help, I sat down with Caren Martin of Ellis Insurance and asked her a few questions.

Question: From a home buyer’s perspective what should they be looking for when shopping for insurance?

Answer: Buying a home for your family is the most important asset for most of us, and you want to protect your assets. Insuring your home with the right company and coverage are critical. When looking at all of the company options for insurance, you want to make sure that you are only looking at “A” rated carriers. This rating is from the State of Texas and consists of customer care and claims service.

Most companies offer three types of policies:

  • BASIC COVERAGE – Actual Cash Value, no water damage and covers only “named perils”
  • BASIC COVERAGE with EXTENDED COVERAGE – Endorsed with 100% Replacement Cost, Water Damage, covers “named perils”
  • ALL RISK COVERAGE – 100% Replacement Cost, Full Water Damage & “all perils” are covered in the policy

Question: What is replacement cost and why does this matter to me?

Answer: Replacement cost for your home is determined by the total square footage. Replacement cost is intended to cover the cost of a “Total Loss” and any “Out-of-Pocket” expenses to you for demolition and debris removal. In most cases the “appraised value” is less than the replacement cost on an insurance policy.

Question: I’ve heard the insurance company will check my credit. What impact will this have on my policy and will the inquiry bring down my credit score?

Answer: Most companies do have what is called “insurance scoring”, which consist of a credit inquiry, insurance responsibility and claims filed. These companies will offer better rates and coverage for your family. We are also looking to see that you haven’t had any lapses in any previous policies. This will show as an inquiry on your credit report but a singular inquiry should not impact your scores.

Question: Can you please explain Flood Insurance? If it’s needed how do you determine the coverage amount?

Answer: When you purchase a home, a survey will be completed and a “Flood Determination Certificate” is done which determines whether or not your property is located in a flood zone. If your property is in a flood zone, then the mortgage company will require you to carry flood insurance. This is a separate policy from your “Homeowners (Hazard) Insurance.”  Flood Insurance is defined as incoming or rising water. One way of possibly reducing the premium is to obtain an Elevation Certificate. Any surveyor can perform this service or you may be able to obtain an existing one from the seller of the property.

Question: How can a consumer save money using an independent agent such as yourself?

Answer: Using an Independent Agent is definitely an advantage over the “Captive Agent” because consumers like options. Ellis Insurance is a full Service “Independent Insurance Agency”. We have been in business for 30 years servings the entire State of Texas.

Ellis represents over 30 “A” rated companies including Allstate, Travelers, MetLife, Safeco, National Lloyds and Progressive. As an Agency, we are very conscientious about our clients’ needs. It is our goal to not only save you money but also to make sure all your insurance needs are met.

Call me today to discuss your mortgage needs or Caren at 214-608-2244 for all of your insurance needs.

About the Author

• Leesa Sandoval • 972.725.9110 ⇒ I have been a Mortgage Loan Consultant in Dallas, TX for over 13 years, and I specialize in FHA 203k Rehab Mortgage Financing .....(Read Full Profile)

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