Not All Homeowner’s Policies are Created Equal

Here’s an "apt" comparison – homeowner’s insurance and NFL quarterbacks. Uh, what? How?

Well you see, not all are created equal. You’re playing fantasy football. You’re a few rounds into your draft, and you desperately need a quarterback. Somehow, no one has grabbed Peyton Manning (see definition for hypothetical). But on the other hand, you are one of maybe three Coloradoans who still has a soft spot for former Bronco signal caller Jay Cutler. No matter, the decision is fairly easy, right?

You may have a soft spot for your former coverage or agency, but if a better policy was out there, you’d at least look into it, wouldn't you? In our last blog post, we discussed new regulations with the Colorado Homeowner’s Insurance Reform Act (HIRA), and what that could mean to you as a homeowner. Now, we’ll go into what your policy should have. Or, at very least, what you should be aware of.

Of course, we at Pure Risk Solutions are extremely knowledgeable and can help you get the best protection possible for your home. So, please call us. Ask for me, Dave Godel. We can discuss your policy, or the Bronco’s chances of winning the super bowl. Either one. But preferably both.

So, what should you be aware of?

•  Flood Insurance – are you aware that it’s a separate policy? If not, chances are that you don’t have it.
• Rebuild Costs – Laura talked about these a bit last week, but the thing to know is that they’re always changing. At PRS, we can quickly assess and determine a rebuild cost estimate for your home.
• Extended Replacement Cost – HIRA has an extended replacement cost stipulation. For example, if you are insured for $700K, but the rebuild cost of your home following a loss is actually $750K, you’d actually still be covered. Fairly reassuring.
• Relocation Duration Extension – Say that three times fast. Typically, there’s a 12 month period of coverage for finding another living situation during a rebuild in the event of a covered loss. Now, the period has been extended to 24 months.
• Insurance Packaging Options – While a certain larger carrier with a rather annoying, red haired woman spokesperson has just about trademarked the term ‘bundled’, that’s what we’re talking about in terms of packaging. PRS can help you to package your auto, home, and any other type of insurance together with one carrier, or at very least run a few estimates to see if this would be a beneficial option for your family.
• Medpay – We’ll call this “Friend Coverage”. If someone gets injured on your property, they can actually be covered under your policy. Say it’s Halloween night, with kids trick-or-treating. If one of them were to trip on your front step, you’d both be covered. This is a great way of avoiding a potential lawsuit, or not pissing off your neighbors.

So remember, the next time you’re sitting in front of the TV watching the Bronco’s game and Manning threads a bullet of a pass through the seam to Eric Decker for a touchdown – home insurance. My light-hearted sarcastic prose aside, we do encourage you to call us here at Pure Risk Solutions to let us show you how many options you have for insuring your home. Additionally – have a very safe and happy new year! 2014 looks to be a fantastic one.

Is Your Home Adequately Insured for a Loss?

Yeah, I know. It’s not a fun thing to think about. Let’s flash to a hypothetical.

You’re a homeowner – maybe one just settled in to a new home; your dream home, even, and one you’ve been socking away money in your bank for, for years. You wake up on a typical Saturday, coffee in hand, about to take your jack russell terrier Scout out for a walk. Then, the unimaginable happens. An avalanche! Hail! The slugger on the little league baseball team practicing the next field over comes to bat! In other words, damage to your home.

So what’s the first thought that comes to mind? Likely – am I properly insured?

At Pure Risk Solutions, we would be happy to be your peace of mind when answering that question. If you call me, Laura, or my fellow home insurance savant Dave Godel, one of us can give you an assessment of your current policy, and importantly – let you know how the new Colorado government reform act will affect it.

In case you were unaware, the Colorado Homeowner’s Insurance Reform Act (HIRA) was passed in May 2013. Generally, it’s meant to protect homeowners if their house is seriously damaged or destroyed. That said, policy rates may go up.

Here are some of the highlights:

• Initial changes kick in January 1, 2014
• Replacement cost policies (cost to replace property in the same location, with comparable material and quality), must include an option for:
• Extended coverage of at least 10% of the additional cash limit available in a rebuild event
• Ordinance and Law coverage of at least 25% of the additional cash limit available in a rebuild event
• Replacement cost policies offered by insurers must include at least 12 months of Additional Living Expenses (ALE) coverage, with the option to purchase for a full two years
• Additional time (> 1 year) to file for a claim

With due apologies for all the insurance jargon, we encourage you to ask yourselves if know the answers to the following questions. If you don’t know the answers, your current agent has not been doing his or her job.

How did you determine the replacement cost for your home when choosing a policy?

If your current agent has not run replacement cost estimates for your home, please call Pure Risk Solutions today and allow us to do so for you. It is the crucial piece of information to have in the event damage occurs.

In the event of total loss where you’d have to live elsewhere, have you done an inventory of your home’s contents?

Without the correct inventory information, the most you can receive is 25% of the coverage amount of the lost property.

Are you aware of property sub-limits?

Possessions like jewelry, guns, and fine arts have a maximum replacement value you can receive for each item, unless they are listed individually on the policy. Call PRS for a proper assessment of items valued at over $1,500 (the sub-limit).

Are you aware of Ordinance and Law coverage?

Well, technically – yes, the definition is linked above. In a nutshell, in the event of partial home destruction, a building inspector may require demolition of the undamaged portion of a home to bring it up to code. The undamaged portion would not be covered under your policy unless you had adequate Damage or Loss insurance. PRS can help you determine the total value you need to insure your home to avoid a situation like this.

To sum it all up, there are a lot of changes coming with HIRA. And while you can hope to not have to worry about them, you’ll be happy to know you have, if the unimaginable ever were to happen to your home. Please contact me, Laura Stanko Joy, your helpful local agent at Pure Risk Solutions at laura@purerisksolutions.com or (866)738-2180 for answers to the questions above. Happy Holidays from our family to yours!