HOMEOWNERS INSURANCE – How rates are calculated
Many factors are considered in calculating the cost of home owner’s insurance, such as:
- Credit Scores – review your credit report annually, and clean-up as needed.
- Location – is your home, or the one you are considering purchasing, in-town or in a high fire risk area?
- Prior claims – either by the policy holder or the property can increase rates.
- Age and condition – if the home’s major systems or roof are 40+ years old, or if there is too much deferred maintenance, premiums will rise or coverage can be declined.
- Construction type – unique types of homes (log, hay bale, rammed earth) can be more difficult or expensive to insure.
- Professional discounts – some occupations, like Teachers, Physicians, Scientists, Police Officers, Firefighters, Accountants, Engineers and Registered Nurses, may be able to receive a discounted premium.
If you are house hunting it is worth shopping for insurance. Your Insurance Agent will provide a binder as “evidence of insurance” once you are under contract to purchase a home.
Source: FARMERS Insurance Agent Ben Frihauf in Durango, CO