No matter where you live, it is essential that you purchase homeowners insurance. In New Jersey, it is incredibly important in order to protect you and your family from any unforeseen circumstances. However, the cost of your homeowners policy will vary depending on several factors. Read on to find out what insurance companies carefully consider when they are determining the cost of your homeowners coverage.
- Location of Your Property
Some areas, including coastal locations, are more prone to weather damage, such as wind and storm damage. Other areas suffer from high crime rates, while other areas are further away from fire departments and hydrants. Companies will evaluate the common threats your area faces in order to determine the price of your policy.
- Cost to Rebuild Your House
This is different from the amount you paid to purchase your house in the first place, or even the current price of your property today. Make sure that you insure it according to its replacement cost. Many policies state that if you are underinsured and suffer a loss at this time, you will be dealt a co-insurance penalty. Even if it is a minor loss, you might end up paying for several different out of pocket expenses.
- Type of Construction
Strong material such as brick is better at withstanding wind as well as fire. Depending on what your residence is made out of, your policy price can be impacted.
- Age and Condition
Premiums will be higher for older ones or properties that need to be updated. Newer homeowners can even qualify for certain discounts.
- Claim History
Whether or not you have filed claims in the past can impact your rates. You need to demonstrate that you are a responsible homeowner.
- Coverage You Choose
Additional coverage that you add on will impact the price your premium.
- Selected Deductible
Higher deductibles will result in lower premiums. However, it will also mean that you are responsible for paying a larger portion of each covered claim.
- Customer Loyalty
Many times, it is better to have your policies come from a single insurance company. Many companies will offer certain discounts if you choose to purchase multiple policies from them, in order to reward your loyalty and dedication as customer. However, make sure that you do your research. It is not worth it if other companies offer better coverage at a better price.