Red Letter Mortgage -- What You Don't Know Can Hurt You

What You Don’t Know Can Cost You
Tips for keeping your homeowners rate in check

Think you’re paying too much for homeowners insurance? You could be making expensive mistakes without knowing it.
While you may have little control over political, regulatory, and business environments that affect rates, you can take steps to avoid costly claims that could send your premiums through the roof.

First things first
Before you do anything else, make sue you understand what your homeowners insurance policy does and does not cover. Remember that insurance is best used to protect against the high cost of major losses that would be difficult or impossible to pay oft of pocket.
If you use your insurance policy as a home-maintenance policy, you’ll find that filing repeated claims for minor repairs could prove expensive in the long run. Some companies, including USAAS, use claims frequency to predict future risk, often resulting in higher premiums, higher deductible, and occasionally, declined coverage.

Quick fixes
One of the easiest ways to keep your home in good condition- and your insurance rates in check- is to conduct routine maintenance.

Some tasks, such as cleaning chimneys or replacing toilets, may require the help of a professional. But with time, patience and yes, a little cash- you can probably handle the small stuff on your own.

Choosing the right materials
If you’re remodeling, shopping for a new home, or building from the ground up, look beyond aesthetics. According to the Institute for Business & Home Safety, non- combustible roofing materials such as tile, metal, slate and treated wood can make your home more fire resistant.
Exterior walls and roofs made of fire- and hail-resistant materials reduce your risk of severe damage, which may result in lower insurance rates.

Get Annual Checkups
Call your insurance company anytime you make improvements that affect the value of your home, and evaluate your homeowner’s policy at least once a year to ensure your coverage keeps pace with improvements or rising value. Your policy should cover your home’s replacement value (the amount it would take to rebuild your home if it were destroyed), not the market value (the price you could get for your home).

Exterior
1. Geography: Most insurance companies charge more for homeowners insurance in high-risk areas such as wildfire zones or coastlines
2. Structure: Some of the building materials may lower risk, which could translate into lower insurance rates. In general, homes made of fire-resistant materials, such as brick and stucco, receive a lower rate than those made of wood.
3. Fire Protection: Usually, a house that is more than five miles from a responding fire station falls into a higher-rated category.
4. Roof: Some insurance companies offer discounts for durability- in fact, USAA offers lower premiums in some locations for roofs that are hail-resistant. Concrete tile, for example, withstands hail better that wood shake.
INTERIOR:

5. Safety Features: Many insurance companies offer discounts for fire and burglar alarm systems. USAA gives a discount of 2 to 15 percent, depending on the types and combination of alarms or sprinklers in the home.
6. Age of home: Older heating, plumbing and electrical systems create a risk of fire and water damage. Many insurers may offer discounts on newly built homes. For example, USAA offers a 20 percent discount on the premium for a new home and discounts of 2 to 18 percent for homes less than 10 years old.
7. Watertight seals: Secure seals around sinks, tubs and toilets help avert water damage claims which, in turn, prevent premium in creases due to claims activity.

We’ve got you Covered:
USAA contracts with Marshall & Swift/Boeckh to contact you periodically to gather information for estimating current reconstruction costs, base on general costs of materials an labor. A short, written survey and a 10- minute phone call is all it takes. Still, it is your responsibility to ensure you have adequate coverage to protect your home. To review you coverage immediately, call USAA Policy Service at (800-531.8111)