Utah Homeowners Insurance Guide

Unless you are fabulously wealthy and wouldn't really miss the money if your house was destroyed and you had to pay to replace it, you should have home insurance. Although Utah does not require you to have home insurance, it is a wise idea to have, and if you have a mortgage, your lender probably requires that you get it. You should review your homeowner's insurance policy carefully, as you do not want to find out after the fact that you were inadequately covered. These are some of the things that you should know about home insurance in Utah.

Earthquake and Flood Insurance is Not Standard

When you purchase a home insurance policy in Utah, you may be surprised that earthquake and flood insurance is not normally covered. If you want to be insured against these hazards, you will have to insure for them separately. Not all insurance companies carry these policies any more. For flood insurance, you may have to go through the National Flood Insurance Program. Although Utah is not known as earthquake territory, a small earthquake happens in the state almost every day. If a large earthquake were to occur and your house was destroyed, the loss would be devastating.

Parts of an Insurance Policy

There are several different parts to an insurance policy, and you want to make sure that you are adequately covered in each area. They are:

• Dwelling - This covers the physical house. You want to make sure that you have enough coverage in this part of the policy to replace your actual house if it was destroyed.
• Other structures - This covers buildings and structures that are not a part of your house. This part of your policy would cover a detached garage, pool, or storage shed.
• Personal property - This covers the contents of your home, such as furniture, appliances, clothing, and your possessions. Certain items, such as jewelry, might need to be insured specially.
• Loss of use - Loss of use coverage will pay for the added expenses that you would incur if something devastating happened to your house and you could not live in it while it was being repaired. If a fire occurred in your home and you were unable to live in it for six months while repairs were being made, would you be able to afford to pay rent and a mortgage payment at the same time? Don't skimp on this part of your policy.
• Personal liability - This coverage will pay for damage to property or bodily injury that occurs that you legally are responsible for. For example, if someone falls down the stairs and breaks their hip, or your child is playing baseball in the backyard and breaks your neighbor's window, personal liability coverage will help you pay for damages.
• Medical payments - This coverage will pay for any medical expenses that occur when someone is injured on your property. It does not cover medical expenses for you or other people that live in your house.

Your Credit Score Affects Your Insurance Cost

It sounds unfair to punish people with low credit scores by increasing their insurance premiums, but unfortunately, many insurance companies will charge you more if your credit score is lacking. There seems to be a statistical correlation between a person's credit score and the losses that they claim on their homeowner's policy. Paying your bills on time, making sure there are no errors on your credit report, and paying down your credit cards not only will get you a better interest rate when you go for your next loan, it might also lower your homeowner's insurance.

Higher Deductibles May Lower Premiums

If you want to save money on your home insurance, you may want to consider a higher deductible. A deductible is the money that you will have to pay before the insurance company will start reimbursing you. When shopping for insurance, compare the rates with different deductibles.

Shop Around for the Best Rate

Not every home insurance company is the same. Try looking at different insurance companies to see which one will charge you the least amount of money. You don't have to choose the default insurance company that your lender recommends.

Review Your Coverage Annually

Because situations in your life change, you should review your home insurance policy annually. Be especially aware of the amount that your structure is covered for. In times when building costs are rising, it is quite common to find that you need to increase this coverage.