Homeowner's insurance is a necessity for homeowners. No one wants to be caught in the middle of a catastrophe without the means of repair. Fortunately, homeowners insurance provides owners with the help they need when disaster strikes.
Some homes are not eligible for standard homeowners insurance. For those homes, high-risk insurance is available. High-risk insurance is for homes that have been denied that standard insurance.
These homes are located in areas that are considered high-risk, such as those with high crime rates or that have drastic weather conditions. A standard home can fall into a high-risk category if the owner has not paid their insurance premium on their home insurance.
Should You Choose High-Risk Homeowners Insurance?
If you are unable to buy standard homeowners insurance, purchasing high risk insurance is a great option. Here are some reasons that you should get high-risk homeowners insurance.
Your standard homeowners insurance is cancelled
Sometimes a homeowner has standard insurance that gets cancelled. Cancellation is typically due to the owner failing to pay their premium, but sometimes it happens after an inspection in which the inspector determines that the property is in a high-risk area.
You have many claims on a policy
If a homeowner makes multiple claims on their policy, the insurer may choose to no longer provide insurance on the property.
Your home is empty
You don’t live in your home and want to rent it out
You have more than one mortgage on the home
You are denied insurance due to the age and condition of the home
Every home ages and has wear and tear. Some homes that are not kept up over the years end up looking pretty run down and deteriorated. Often insurance companies will not renew coverage or will just get denied altogether if the home seems to be falling apart.
What is a Fair Access Insurance Requirement Program?
It’s important for all homeowners to have access to homeowners insurance. In order to ensure that homeowners with high-risk homes are able to obtain homeowners insurance, Fair Access Insurance Requirement (FAIR) programs were developed.
These programs are subsidized by taxpayers and private insurers, and allow a number of companies to come together in order to hold the risk of a high-risk home. Instead of having home insurance through one company, when you have high-risk insurance, there are many companies that take responsibility for your claim if your home is struck by some sort of catastrophe.
What Should I Do if I Have a High-Risk Home?
Negotiate with insurance companies
Talk to an agent
Talk to your neighbors
Can I Reduce my High-Risk Home insurance Premium?
If you have insurance on a high-risk home, you likely have a high premium. But you don’t need to worry. It is definitely possible to reduce your premium.
For homes in high-risk areas due to a high crime rate, security systems are a plus. If you install a security system in your home, your premium should lower. Some areas are high-risk due to frequent storms and other natural disasters. If you are in one of those areas, perform repairs and maintenance to improve the foundation of your home. This added protection will usually reduce your premium.
You can also lower your premium if you increase your deductible. Just be aware that doing so will mean you have to pay higher upfront costs when you make a claim.
Insurance for High-Risk Homes
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