Consumer's Guide to Homeowners Insurance TIM RYLES COMMISSIONER OF INSURANCE Seventh Floor, West Tower Floyd Building 2 Martin Luther King, Jr. Drive Atlanta, Georgia 30334 (404) 656-2070 What is Homeowner's Insurance? Homeowners insurance is coverage for your home, its contents, and your personal liability. A Homeowners' policy usually covers (I) property damage for your home and other detached buildings (2) contents and personal belongings (3) reimbursement for the cost to live at another place if your home is damaged and uninhabitable (4) personal liability to protect you from a claim or lawsuit if you are responsible for injury to others or damage to their property. What is usually not covered? Most policies will not cover automobiles or car stereo equipment, natural or man-made disasters such as flooding, earthquakes or nuclear accidents, or property used for business purposes. (You can usually buy coverage for these things in a separate policy.) How can I reduce my premiums? Most companies offer discounts when you install a deadbolt, burglary alarm system, or a smoke alarm(s). You may qualify for a further discount if you have a claims-free background or increase your deductible. I can't get Homeowners insurance... where can I go? The Georgia FAIR Plan offers coverage for your building and contents with limits up to $300,000. Apply for the FAIR Plan or obtain information on your eligibility by contacting the Georgia Underwriters Association at (404) 923-7431. How might I lose my homeowners coverage? Each time your policy renews the company reviews your account for any changes. Some of the most common factors companies look at are past claims and upkeep of property. What is the difference between Actual Cost Coverage and Replacement Cost coverage? Most standard homeowners policies provide actual cost coverage for your dwelling up to the policy limit. Your contents and personal belongings are settled at their actual cash value at the time of the loss. There may be a deduction for depreciation. Some policies will offer replacement cost coverage which will repair or replace personal property at current prices with no reduction for depreciation. You can usually upgrade your policy to replacement cost coverage for an additional charge. A current inventory of your personal belongings, stored in a safe place, will help you in establishing what property was destroyed and its value if you have a claim. DID YOU KNOW ... If your homeowners policy has been terminated for any reason, your company must provide a refund for the unused portion of the premium. If your insurance company stops doing business with your agent, your policy will continue with no gap in coverage. Your company can assist you in locating another agent. The transfer to a new agent must occur before your policy term ends. If you have previously been declined coverage, or terminated, an insurance company or agent cannot automatically refuse to issue or terminate your homeowners coverage. However, insurance companies and agents are entitled to information about previous claims which they may use to support their decision about selling you a policy. If you are denied coverage or terminated, you are entitled to a written or verbal explanation, upon request. An insurance company or agent cannot require you to purchase any other item, such as an "Auto Club" or "Home Warranty" as a condition for issuing you a policy. A company or agent may cancel your homeowners policy for any reason within the first 60 days of the policy. However, you must be given 10 days written notice. If your homeowners policy has been in effect for more than 60 days, the company or agent must give you 30 days written notice of termination. Otherwise your policy cannot be terminated during the policy period except for non-payment of premium, giving wrong or omitting important information, fraud, a substantial increase in the risk or if you violate any terms or conditions of the policy. An exception is non-payment of premium and then the insurance company is required to give a notice of only 10 days. Your policy cannot be cancelled for two claims or less within the past 3 years unless the claims against the policy were caused by negligence or an intended act. What do I do when I have a loss? You must make temporary repairs to protect your house and personal property from further damage. You should notify your agent or company as soon as possible. You need to make a list of items that were damaged or lost. Fill out and return paperwork and available receipts as soon as possible. What do I do when I don't agree with the company's settlement agreement? If there is a disagreement with the amount of the settlement offer made by your company, you have the right to appeal the company's decision. Please read your policy for details of the process. I am having a problem with my company. What can I do? You can file a complaint with the Department of Insurance, either by phone or writing at the number and address provided on the cover page. SUGGESTIONS: If you are going to leave your house unattended for an extended period of time, several suggestions are: do not turn your heat system completely off so that water pipes are protected from freezing during extreme cold, have a friend check on your house frequently, picking up newspapers, mail, mowing the lawn..things that keep your house from looking like no one is at home. Some insurance companies have exclusions for houses left vacant for over 30 consecutive days. Check with your company if you plan to be away for any extended period of time. When buying a home, you should find out if the house is in an area that has been known to flood or has been designated by the Federal Emergency Management Agency as a flood area, you will need to buy a flood policy through the Federal Flood Program. A typical homeowners policy does not cover damage due to flooding. If you live in one of these "flood" areas and have a mortgage on your home, the mortgage company will require that you purchase a flood policy. For more information call (404) 853-4400. --- ----------------~ "THAT'S A GOOD QUESTION" ...If my neighbor's tree falls on my house or my car, who will pay for that? If it was a healthy tree and was blown over during a storm, an "act of God", your neighbor is not responsible. Your homeowners policy will pay for damage to your house and if you have comprehensive auto coverage, that will pay for damage to your car. If the tree was dead or diseased and your neighbor was aware of the problem but failed to take care of it, your neighbor should pay . ... What is windstorm coverage? This is insurance for property damaged as a direct result of strong wind or haiL ... What if someone's car hits my house? Who pays? The liability policy of the owner of the car should pay for this damage, however, the claim could be paid by your homeowner policy. Did you know the Insurance Department recently adopted a new regulation that will be effective November 1, 1994 that prohibits insurance companies from refusing to write a homeowners policy for any of the following reasons: ... Marital Status ... Length of time at an address ... Length of time employed ... Level of Education ... Failure to buy additional policies ... Age of dwelling without consideration of updated systems ... Member of the U. S. Military ... Proof of prior insurance If you feel that you have been denied access to homeowner's insurance due to any of the above reasons, please call the Office of Commissioner of Insurance. TIM RYLES COMMISSIONER OF INSURANCE (404) 656-2070 Flood Insurance Federal Emergency Management Agency (404) 853-4400 Georgia FAIR Plan, administrated by Georgia Underwriting Association (404) 923-7431 ~ Tim Ryles t Commissioner of Insurance Seventh Floor, West Tower Floyd Building 2 Martin Luther King, Jr. Drive Atlanta, Georgia 30334 THE OFFlCE OF COMMISSIONER OF INSURANCE DOES NOT DISCRIMINATE ON THE BASIS OF RACE, COLOR, NATIONAL ORIGIN, SEX, RELIGION, AGE OR DISABILITY IN EMPLOYMENT OR THE PROVISION OF PROGRAMS OR SERVICES.