Oregon Homeowners Insurance Guide

You might think that buying an insurance policy to cover your house is kind of standard. But the truth is that each state has its own laws, and some even have their own jargon associated with home buying. Also, each state, because of its uniqueness of geography and so on, has its own things to be concerned with. Homes in Arizona, for instance, can come with flat roofs, which actually have their own structural issues. And in comes states, insurance for a home is known as “home insurance,” while in other states, like our own Oregon it is known as “homeowners insurance.”

Oregon Homeowners Insurance Laws

There are other differences between homeowners insurance in Oregon and in other states. Chief among them is that in Oregon your credit rating can affect your homeowners insurance premiums. It is referred to as “credit scoring” or “insurance scoring.” So, while some homebuyers focus on their credit score before buying, with an eye to getting a mortgage, Oregon homeowners need to keep their score up afterward as well. If your interest rate should drop, your homeowners insurance rate could go up. So, be sure to make your house payments on time, and in full. But this is true for all the various items that could impact your FICO score. Car loans, student loans, and credit card payments all need to be made on time. And as for credit cards, you should also seek to keep the balances below 30% of their limits.

In addition to that quirk in Oregon’s homeowners insurance, there are three broad categories of coverage here: the Actual Cash Value option and Replacement Cost insurance policies.

Guaranteed Replacement Cost

This kind of policy is exactly what it seems: If your home is utterly destroyed, with certain exceptions like flood, the insurance company guarantees replacement. There are certain exclusions, say for antique woodwork, but unlike many states where actual cash value” policies reign - and allow insurance companies to deduct depreciation from the cost - Guaranteed Replacement Cost policies offer a sense of well-being. Homeowners can rest assured that a house that needs to be rebuilt, will indeed be rebuilt. Of course this doesn’t take into account the particulars of one insurance company over another. Some insurance companies are famous for fulfilling their promises and the letter of their insurance policy agreements. Others are infamous for fighting claims tooth and nail. So, while this policy type covers you on paper, you will still need to investigate individual insurance companies and review your policy carefully. And, you will want to look into flood and fire endorsements.

Extended Replacement Cost

Let’s say that you do live in a home with antique woodwork or other extras in the construction of your home. Well, Guaranteed Replacement Cost, despite the implication, will not cover that. For such a homeowner, Extended Replacement Cost policy is the better part of wisdom. More expensive than Guaranteed replacement, it just might pay off in the end. Why? Because it covers your house for a specified replacement value, typically adding a 20-25% to the value of the home - an extended amount - in case rebuilding costs should have overruns.

Inflation Guard Coverage

The most expensive approach to a homeowners policy, Inflation Guard Coverage is akin to Replacement Cost coverage offered in many other states. Essentially, as your home increases in value, and as the materials it takes to rebuild increase in costs due to inflation, so does the level of coverage. So, the dollar amount to replace your home and its contents also increases.

Though we’ve tried to offer you a good deal of information regarding homeowners insurance in The Beaver State, you should check with Oregon’s Insurance Division, and invite quotes from a number of insurers who specialize in Oregon homeowners insurance.