Tips for Home Insurance Shoppers

Tips for Home Insurance Shoppers:


Q: When did home insurance start? What is the real purpose of home insurance?
A: The first homeowner's policy per se in the United States was introduced in September 1950, In the event of a loss such as a fire or major storm that does damage to a home many times the cost to repair the home is far greater than the owner’s ability to recover. Hence home insurance was created to ‘indemnify” or “return” the property to the state it was before the loss.

Q: What facts should I gather about my new house before I start shopping? (ie. age of electrical, energy efficient additions, etc)
A: Many factors go into how carriers rate homes for risk and ultimately premiums. Some of the main facts needed are: Year built, Age of roof, type of plumbing, square footage, construction type, etc. In addition the “Declarations Page” from your current policy will help the agent to review your current policy, gather information and recommend the best fit for you. Older homes prior to 1950 may require a bit more time for review. Lead paint, galvanized plumbing and plaster were used commonly prior to 1950 and impact the rate.

Q: How can the location of my home affect my insurance costs?
A: One of the biggest factors in location is distance from a fire hydrant and fire station, the farther away from these the higher the risk of a larger loss. The location of the home is also an important factor. Some areas are at a higher risk of theft, fire and other losses than others.

Q: How do I make sure I am not underinsured? What does it mean to make sure I insure my home to “replacement value”?
A: Insurance carriers use a tool called a “Replacement Cost Estimator” to estimate how much it will cost in today’s market to replace your home from the ground up in the event of a total loss. This is the “replacement value” of your home. Another type of coverage is “Actual Cash Value”. This type of coverage only covers the cost of the home depreciated over time. This is not recommended and is rarely used. If your home has a mortgage the lender will require “Replacement Cost” coverage.

Q: In your personal opinion, is it worth it to get additional coverage for some of the valuable items in my home?
A: In the event of a loss, say a fire for example. Items that are of exceptional value many not be covered on your homeowner’s policy. Most standard policies allow some coverage for items such as jewelry, furs, art work and the like but often it is not adequate to cover the item in the event of a loss. If you have items such as these check with your agent and review your policy coverage limits to be sure these items are covered.

Q: Can I save money on my monthly premium if I add certain safety features to my home?
A: Many carriers give discounts for security systems, central reporting fire and burglar alarms.

Q: How can I ensure that I am working with a home insurance provider that I trust?
A: Insurance carriers are rated by independent rating agencies. The most widely know of these is the AM Best rating. Make sure your carrier is highly ranked by these rating systems. This means the carrier has demonstrated exceptional financial stability.

Q: What’s the best way for people to get in contact with you and your company?
A: You can reach the Kennedy Nemier Insurance Agency by phone at 734.454.4058, visit our website at or email us at

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