Many homeowners do not understand what exposures are covered under their home insurance policy, according to a new consumer survey.
More than two in five Americans (41 percent) believe that a standard homeowner’s insurance policy protects against mold damage, according to new InsuranceQuotes.com survey
“This misconception could prove extremely costly,” said Laura Adams, senior insurance analyst, InsuranceQuotes.com. “Mold remediation can cost tens of thousands of dollars. It’s often not covered by homeowner’s insurance, especially if it was caused by neglected maintenance such as a leaky pipe.”
The survey also revealed that many homeowners are misinformed regarding personal belongings stolen from a car (73 percent aren’t aware that this type of theft is covered by homeowner’s insurance) and earthquake damage (51 percent don’t know that this is not covered by a standard homeowner’s insurance policy).
Two better understood aspects of homeowner’s insurance are fire damage (90 percent of Americans know that homeowner’s insurance covers this) and lawsuits from an injured visitor (72 percent know this is covered).
Just under one-quarter of homeowner’s insurance policyholders said that they chose their current provider primarily because of a recommendation from someone they trust (22 percent). A similar number (21 percent) said the most important factor was the service they received from their agent. Seventeen percent said their decision hinged on getting the lowest price. But only 1 percent of homeowners insurance purchasers said a radio or television commercial was the most important factor in their decision.
The survey was conducted by Princeton Survey Research Associates International (PSRAI). PSRAI obtained telephone interviews with a nationally representative sample of 1,003 adults living in the continental United States. Telephone interviews were conducted by landline (500) and cell phone (503, including 229 without a landline phone). Interviews were done in English by Princeton Data Source from April 4-7, 2013. Statistical results are weighted to correct known demographic discrepancies. The margin of sampling error for the complete set of weighted data is plus or minus 3.7 percentage points.
Florida Insurance Commissioner Kevin McCarty is encouraging Floridians to make preparations now for the upcoming 2013 hurricane season by purchasing flood insurance.
Flood insurance is administered through the National Flood Insurance Program (NFIP) and is available to homeowners, renters and business owners who live in a community participating in the NFIP.
Commissioner McCarty said last week consumers should be aware that significant rate increases will take effect for new and renewal NFIP policies starting on Oct. 1, 2013.
Floods are the most common natural disaster in the United States; however, flood damage is not covered by a typical homeowners or business insurance policy. This type of coverage is an extra layer of security in the event of a catastrophic event.
“Florida’s risk for severe weather is well-known and, even though a hurricane has not impacted our state in recent years, several tropical storms have caused significant flood damage to many Floridians,” Commissioner McCarty said.
“Regardless of the storm type, I strongly urge Floridians to prepare now and purchase flood insurance by May 1st, as a typical flood insurance policy takes 30 days to become effective. This will ensure you are covered on June 1st, the first day of hurricane season.”
Florida consumers can purchase flood insurance from NFIP for up to $250,000 for property damage and $100,000 for personal contents. Excess flood insurance can be purchased for homes valued at more than $250,000. NFIP coverage is also available for commercial structures at $500,000 for building coverage and $500,000 for contents coverage.
In July 2012, the U.S. Congress passed the Flood Insurance Reform Act of 2012 extending the NFIP through Sept. 30, 2017. Key provisions of this legislation will be implemented over time and include raising premium rates to reflect the actual flood risk of the program, phasing out subsidies on properties with repetitive losses, allowing coverage availability for multifamily properties and minimum deductibles for flood claims.
Source: Florida Office of Insurance Regulation
More than four in five Americans (81 percent) know that a standard homeowner’s insurance policy doesn’t cover flood damage, but even so the vast majority of homeowners do not purchase flood insurance.
A 2012 poll by the Insurance Information Institute found that only 13 percent of American homeowners had a flood insurance policy. The Federal Emergency Management Agency (FEMA) and its National Flood Insurance Program (NFIP) identify flooding as the United States’ No. 1 natural hazard.
FEMA usually classifies properties as either high flood risks or low-to-moderate flood risks. Bankrate.com asked Americans whether or not they know the correct classification for their home and only 51 percent said they know the correct risk category.
“This is a classic ‘do as I say, not as I do’ situation,” said Doug Whiteman, insurance analyst, Bankrate.com. “The vast majority of Americans know the key facts about flood insurance, but they haven’t taken the necessary steps to protect their homes.”
Whiteman says that homeowners should first ensure that they know their home’s correct FEMA flood risk designation. Next, they should review their homeowner’s insurance policy and investigate the cost and availability of a separate flood insurance policy. He says that it may be much cheaper than people expect.
“The average flood insurance policy costs about $50 per month, so for roughly the cost of dinner and a movie, consumers can protect themselves against disaster.”
The survey was conducted by Princeton Survey Research Associates International (PSRAI).
PSRAI obtained telephone interviews with a nationally representative sample of 1,003 adults living in the continental United States.
Source: Bankrate Inc.
Frontline Homeowners Insurance, a coastal-focused insurer, is now offering wind and flood coverage to Alabama residents with coastal properties in Mobile and Baldwin Counties.
Frontline Homeowners Insurance offers a contractors assist program as part of its coverage, which manages the entire restoration of a property, from claim to completion.
Frontline Homeowners Insurance program for individual properties, including high-value homes, is already available in Florida and South Carolina. Coverage for condominium owners will also be available soon.
Frontline Homeowners Insurance, based in Lake Mary, Fla., is a group of independent insurance companies serving homeowners throughout the Southeast United States. It also operates through its affiliated companies, Fidelity Fire & Casualty Co. and First Protective Insurance Co. Frontline was established in 1998, offering home, property and liability coverage.
Frontline Insurance, a provider of coastal homeowners coverage, is now licensed in Delaware. Frontline already operates in Florida and South Carolina and recently announced a new coverage program for Alabama residents, including wind and flood all in one package.
A feature of Frontline homeowners insurance is their Contractors Assist Program, which manages the entire restoration of a property, from claim to completion.
Now that licensing in Delaware has been completed, Frontline Homeowners Insurance will begin the process of determining insurance coverage specifications and timing for the program release, which it anticipates will be late 2013.
Frontline Homeowners Insurance, based in Lake Mary, Fla., is a group of independent insurance companies serving homeowners throughout the Southeast United States.
Frontline also operates through its affiliated companies, Fidelity Fire & Casualty Co. and First Protective Insurance Co.