Buying the Right Homeowners Insurance by Ron Altman
Buying the Right Homeowners Insurance by Ron Altman
I sat with my own insurance broker, who I’ve used for over 15 years, to discuss the advantages of using an insurance broker rather than researching and using online information or direct insurance companies. I also wanted to discuss how different policies differ and if cost is always reflection of what you actually get.
Barbara: What is the value of using an insurance agent vs. buying online? Does it cost more to do so?
Ron: There are 3 main ways of buying coverage; online or through a 800#, through a local agent who represents only one product, or through an independent agent, who has access to many carriers. The perception is that if you cut out the middle man you will obtain a lower price, but that is not always the case. Since the premiums/rates are filed with the State, each carrier may be more competitive in one market than another, depending on who they decide to service. For example, a company like Chubb may be more competitive for their target market of high value homes, where another carrier may not want to write a policy of over a million or their premiums would be too high. You need to evaluate each company to see how they compare. That is where an insurance agent can be helpful.
Barbara: Is price a direct reflection of coverage?
Ron: Price is relative. You can take two policies and put them side by side. A company may be less than the premium of company B, but A many not be better choice. You need to really review what is included in the coverage form. If B is a much broader coverage for your needs, it may be a better choice. An example of this is: A includes “named perils”, while B is broader and says “all risk subject to exclusions and limitations form,” or if A includes just $5000 of sewer and drain backup versus full limits for B, or if B provides “non-owned auto liability” within the homeowners contract (which may be relevant to people who don’t own a car but rent one when needed), you may opt for B.
Barbara: Should you combine homeowners with car insurance always? Is it more cost effective, or should you evaluate separately?
Ron: Again, combining auto insurance with homeowners is not always the best choice. Companies encourage that because they want to retain that client and will offer an account discount. However, even with discount, if you can separate the coverage and do better in terms of cost and coverage, then it makes more sense to separate it. Can’t assume if put together get a good deal.
Barbara: Deductibles: Should you always go for minimal deductibles?
Ron: Each company has different credits for a higher deductible, so again, it goes back to individual evaluation. Say Company A gives you a credit of $150 to go from $1000 to $2500 deductible, but Company B gives you an $800 credit, you’d go for B.
Barbara: With recent Hurricane Sandy, can people not in a flood zone get flood insurance?
Ron: When not in a flood zone, flood insurance is very inexpensive. But, need to determine why you want it. If thinking to cover your basement, insurance is very limited in covering contents besides equipment such as the furnace. In flood zones, its much more expensive and need to obtain an elevation certificate to write flood insurance in high flood zones. Max limits under a flood policy are $250,000 for dwelling and $100,000 for contents.
Barbara: Besides cost, can you tell my readers the other value of hiring an insurance broker. I know personally what it is after how you helped us through Hurricane Sandy damage, but could you give another example.
Ron: Insurance brokers should be there for you through the life of your policy, not just when you purchase it. If there is a claim, they should be able to be the interface between you and the company and your advocate if you are having issues collecting. I recently had a client after Hurricane Sandy where medicines were spoiled when power was lost. The spoilage was several thousand dollars. Company declined the claim. I believed they misinterpreted the policy, called the adjuster and they reversed their decision and paid.
Barbara: Thanks Ron.
A. Zeeman Company, Inc. the insurance agency Ron Altman is part of was started in 1940 by Abe Zeeman (Ron’s grandfather on his mothers side). So, Ron is third generation. They write all forms of insurance including personal, commercial, life, health and disability, long term care. Licensed in 13 states and represent the top companies in the market. They are located in Mt. Kisco, NY.
Want a personal referral to Ron. Call/txt me at 914-523-5087.
Author:Thomas Ricapito Phone: 914-804-3048 Dated: March 1st 2013 Views: 4,930 About Thomas: I got into real estate sales by accident in 2006. At the time, I recently earned a Bachelor's Degre...
View our latest blog posts in your RSS reader. Click here to access.
J. Philip Real Estate is Westchester & Putnam's premier independent brokerage. Founded in 2005, the firm has grown from a single broker to a strong organization of well over 80 associates despite the housing downturn. The team's commitment to results and client advocacy, as well as our focus on technology and innovation, have positioned us as the "go to" brokerage for area buyers and sellers.