California Home Insurance Quotes
For those who buy homes on the west coast it can be daunting to find that the costs associated with buying a home have such great disparity. This is especially true when it comes to insurance.
However, there are some great ways to ensure that you do not get caught paying more than you need to. The first way is to do your research before deciding where you want to settle down. This may sound trite to some, but when you calculate the lifelong costs you will incur, it could mean the difference between poverty and prosperity.
And when you consider the noted works on the subject, particularly those of Dr. Thomas Stanley (The Millionaire Next Door) and Dr. Robert Pascale (The Retirement Maze), it should be taken seriously.
After evaluating where you want to live there is still some work to do when it comes to getting quotes. Just as two stores on the same street can charge different prices for batteries, two insurance agents in the same zip code can charge a different rate for the same product.
Following that there is still more work to be done. You must make sure you do not fall prey to known the well known costly insurance mistakes. These include making sure you insure the home properly.
This may all sound intimidating, but the whole point of reading this information is to arm yourself with it so that you can rest assured that when you lay your head down at night you have the peace of mind to know that you have taken care of everything properly.
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Deciding Where You Want to Live
Many young readers will see this part of this article and think it is ridiculous to make such a decision based on insurance costs. After all, life is for living, not being overly cautious. However, you must consider the advice of the two noted scholars above.
Dr. Thomas Stanley noted in his best-selling works that what separates many millionaires from those who are mere pretenders is that they do not waste money. Additionally, they realize that the higher of a lifestyle they have (the more they consume) the more they have to earn in taxable income to cover their expenses.
This means that they make a higher income, but it doesn't go toward investments. Rather, it goes to things that do not come back to them, including taxes. This all leads into the work of Dr. Robert Pascale.
Dr. Pascale, a retired research psychologist who dedicated his early life to building a business that studied people's habits, recently provided readers with the keys to his knowledge via the book The Retirement Maze. In it, he goes through the social aspects of retiring, and the results are not pretty.
The early decisions you make - including where to live - will compound over the years. That compounding will either pay dividends upon dividends or charge interest upon interest.
Once you have made this decision, a good place to get some preliminary information is from the site of the National Association of Insurance Commissioners. There, you can find pdf docs of abbreviated and quick guide booklets.
Additionally, it is wise to brush up on insurance terms. After all, you are going to buy insurance for the duration of your life; you should know the basics.
Getting Quotes From Local Agents
Once you are getting to where you are going the next step is to shop around. Do not simply use whoever calls you. While it's a good sign that a local agent is being proactive, the truth is that if you do not look around you will have no idea how your costs measure up.
This is especially important for people who have never owned a home before, as well as those who have used the same agent for years.
While it may sound cynical, the insurance professionals who have been providing service to you and your family for years may be taking you for granted. While they may not be consciously overcharging you, they may not be diligently checking your policies to make sure you're paying the least amount for the maximum coverage.
By shopping around you can shed some light on whether or not you are overpaying. When you do find quotes to be lower, the next step is to bring them to your agent (if you have one) and let him or her see what can be done.
Also, the agent may be able to let you know what you are trading off by going with that other company.
For example, will they cover all of the same things? Are they known for approving a lower percentage of claims? This are important.
If, though, it turns out that your insurance agent is charging you less you can take that as a good sign that you have been well taken care of over the years, but may still want to compare what it is you are being offered for this lower price.
For more information on this topic, you should check out this consumer advocate source from the government.
Avoiding Big Mistakes When Insuring Your Home
As noted above, Forbes states that there are four big mistakes people make, but can avoid. The first is underinsuring your home, which is common enough that just about every site covering this topic lists it.
When you buy insurance it must not be for the price of the home, but the price of replacing it. For example, if you purchase an older home for $480,000 the correct insurance price is on the amount that the home would cost brand new. The reason for this is because when you construct it after it is lost, that's what it will cost to replace.
While this may sound exciting to some - to think that their net worth will increase so dramatically in the wake of their home's loss - it's not a gift but a small consolation for being smart and diligent.
The next mistake people make is not having supplemental policies like flood insurance. Not having this policy is the biggest reason many homeowners who have been otherwise responsible are unable to be compensated for the loss or damage of their dwelling after a natural disaster.
The reason for this has to do with the way in which flooding is defined.
Flooding is when water damages your home. For example, if a tornado was to sweep through your area and send a vehicle into your bathroom, breaking the commode, there would be a flood of water that would run until the water was shut off.
When you put in your claim it will be perfectly reasonable to assume that this was the result of the high wind since it was the cause that led to this effect. However, here is what will happen. The damage to the home from the car will be limited to the non-water damage. Beyond that, you were the victim of a flood.
The third mistake people make is not understanding their deductibles, particularly when it comes to earthquakes.
While your normal policy deductible may be $1000, an earthquake deductible may be ten times as much, or even as high as 15% of the value of your home, making any kind of reimbursement potentially unreachable save or the total destruction of your dwelling.
The only thing worse that this news is not knowing it ahead of time, which many do not.
Lastly, we come back to flooding. When it comes to sewage backup you need to understand who is liable, who needs what kind of coverage, and what you need to do to ensure that you and your family are taken care of.
If you live in a homeowners' association or planed community, the situation will be different than if you live in a rural or urban community.
However, after learning all of this, should you even buy a home?
Deciding to Purchase a Home
The short answer to this question is yes. Buying a home provides many benefits to those who are going to set down roots into a community. It offers stability, a sense of security, and also allows you to build wealth through equity.
Additionally, when inflation takes down the value of the dollar, the effects are that rent will increase as will the values of the average home.
While your home's value increases by a hundred thousand dollars or more, the payment on your mortgage will stay flat. In contrast, rent rates will increase.
The keys to success are to make sure you understand what it will cost to live where you want to, then to gain some basic knowledge of insurance (you should know about something you are going to buy forever), and then shop for the best quotes. When you have the best quote you then need to understand the policy.
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