The media is filled with insurance commercials today warning people about cut-rate insurance. Many companies claim that their insurance, although it may cost more, is far superior due to the fact that it is not cut-rate, or in other words it doesn’t cut corners on coverage like many other low-cost insurance carriers might. Outlandish claims are made in the media all the time, is this claim true?
When it comes to home insurance, it turns out that this claim actually can be true. There are many different policy types with which a home can be insured. The coverage varies drastically between the policies. If an agent is trying to give you the cheapest policy possible, there is a good chance that the coverage you are getting is, well, cut-rate. So how do you know if a home insurance provider is giving you an excellent home insurance policy?
The best way to find out about the policy is to ask the agent. If you prefer doing most or all of your communicating online, however, then there is another way. Home insurance policies are grouped into standard forms that are recognizable throughout the nation. These policy forms determine what type of coverage each policy has. There are good policy forms and there are bad policy forms.
The policy forms that most people would refer to as cut-rate are the HO1, HOA, and often the HO8. These policies can also be referred to as bare-bones policies; they cover the least amount of perils, and typically the coverage is not as extensive as most homeowners would like it to be. There are certain perils that are commonly missing from these policies, like water damage.
If a homeowner is looking for better coverage, the policy form he should be looking for is the HO3 or the HO5 insurance policy. These two forms are highly superior to the other types of home insurance protections that are available. So whether you have San Francisco, Denver, or Houston home insurance, if you don’t want cut-rate insurance, you should consider these types of policies to insure you home.