If you think that you will wait until the storm approaches and then you will purchase this type of insurance, think again.  Homeowners Insurance Companies understand the risk in writing Contents Insurance Policies.  They will not write policies when a storm is forming in the Gulf of Mexico.    Insurance Companies will only write policies when there is no possibility of these tragic events occurring.  For example, if there was a storm out in the Gulf of Mexico, insurance companies stop writing policies completely.  You can’t even get homeowners insurance until after the storm subsides.  Many homeowners and renters attempted to purchase and apply additional contents insurance before Hurricane Katrina and were pushed away because the storm was already formed.  Don’t wait until the last minute to get cheap insurance.  It’s not expensive at all.  A $50,000 coverage premium can cost as little as $200 a year.  It all depends on what you want to cover in your policy.  For me, I added my wife’s wedding and engagement ring.  It too can be covered in your contents insurance policy.

The Benefits of Contents Insurance is for a minimal monthly premium; you can protect everything inside your home from a natural occurrence such as a tornado, to someone breaking into your home.  Just make sure you have the correct coverage on your policy, keep all receipts, take pictures of expensive items, and update your policy yearly.  In doing this, the benefit of contents insurance is peace of mind for you and your family that everyone’s valuables are protected.

You know that the insurance policy you purchased covers up to $10,000 for jewelry but, you need to prove to the insurance adjustors that you owned $10,000 worth of jewelry.  My suggestion is, keep a copy of all the receipts such as jewelry you purchased.  If you don’t have receipts, bring your jewelry to an appraiser to get the items valued to find out the exact replacement cost.  Then, if the items were stolen, you have something to show for the items.  Household Insurance Covers Jewelry, Electronics, Furniture, Artwork, Appliances, Valuables, Clothes, Flooring, and even Bedding.  It covers everything located inside your home.  It’s difficult to keep receipts on everything you purchased.  I would contact your insurance company and find out what is the best way to record your items for evidentiary value.  Ask them if taking pictures are satisfactory.  Make sure you record the person’s name and ask the person to show you where it states that in the policy.  You never can be too sure when it comes to listing your possessions.  Make sure your Household Insurance covers all events such as flood, wind, hurricanes, earthquakes, or stolen.  Household Insurance does not cover automobiles stored in the garage.  There is a separate automobile policy for that and relates directly with the automobile.  If you don’t drive the car and are just storing it in the garage, you may want to contact your auto insurance company.  Household Insurance may or may not cover the sheet rock in the home.  It all depends to your policy.  There is an additional liability coverage to household insurance, called Property Liability Coverage.  This is when someone, like a guest, gets hurt on your property in the result of an accident.  The insurance would cover medical claims from the result of the person being injured on your property.  For instance, your neighbor walks over to your home and falls down the stairs.  You may be protected in this case with Property Liability coverage, which is a part of the coverage of Household Insurance.  What does Household Insurance cover?  Well, it all depends what you include on your specific policy.  Ask the right questions and you won’t need to worry or guess what’s covered, and what’s not covered on your policy.

Read the fine print of your policy.  Don’t assume that the person you are speaking over the phone to at the insurance company knows everything about the policy and, has been there for 10 years.  Sometimes the employees that are working on your specific policy at the insurance company think they know all of the policies, when really they just started working there three months ago.  Sad to say, I’ve seen it happen.  Employees at insurance companies may say to you, “Yes, you’re covered on flood, hurricane, wind, and any natural disaster”.  Then, when a natural disaster comes whipping through your home, and your home is flooded, you begin to say in the back of your head, “Well, at least I have flood listed on my contents insurance.  I’m insured up to $80,000 for all the items I’ve lost in the flood.  Good thing I took out a policy”.  But, did you actually look at and review the policy word for word?  You need to review the policy as soon as you receive it from the insurance agency.

Don’t review it after the disaster happens.  This happens to about 80% of all insurers.  They wait till after the incident then take their policy out to actually read it.  In this case, come to find out, the policyholder did not have flood listed on their contents insurance and they lost everything in the flood.  You’re paying for this policy every month, how do you actually know what’s covered in your policy?  Take the time to read it fully, then, ask questions.  Do they cover for jewelry?  Do I need to take pictures of the jewelry and list the items on an insurance document?  Do I need to get these items appraised?  Do these items need to be inspected by the insurance company?  Ask specific what if questions.  It’s the only way to protect yourself against things that you cannot control.  Find out if the company has a deductible.  List all the positives and negatives about the insurance company.  Find out if they are reputable.  How to get cheap contents home insurance is easy, just make sure you know what is being covered.

When you do get a quote on contents insurance, please make sure you estimate the total value of everything in your home.  Add up everything in your home as though everything was missing and you had to replace it.  Take pictures and record serial numbers of major items such as the HD Televisions, artwork, stereo, and appliances.  It’s important to list these items with the insuring agency in the case of theft, or fire.  When you get a quote, find out if there is a deductable in the event of theft, or fire.  Find out what is the maximum dollar amount of coverage.  Find out what events are listed under the policy they are offering.  For example, does the policy cover for fire?  Theft?  Flood?  And to have contents insurance means, you don’t half to be a homeowner either!  You can have contents insurance even if you are renting a home.

If you have homeowners insurance, it does not mean you have adequate, or any contents insurance.  They are two separate policies.  Homeowners insurance only protects the home in the event of a natural disaster or catastrophe. The policy only protects the structure, sheet rock, and floors.  That means, your personal items are not insured.  A good example of this is the disaster that took place in New Orleans.  Many of the residents lost their homes in the Katrina Disaster.  Many homes were rebuilt but unfortunately, the homeowners didn’t have any contents coverage of the items that they had inside their home.  The homes were eventually replaced, but the items inside the home all had to be replaced and paid by either the resident or the homeowner.

Make sure the insurance company you are getting the policy from is a reputable company.  This is real important!  If the company is not reputable, they may not be able to handle such a catastrophe leaving you with little to no money at settlement.  Remember, they are insuring multiple policyholders and, if there is a major catastrophe in your area, funds will soon dwindle down leaving the insurance company in a bind.  It will also affect how long you will wait to receive your claim.  It’s much safer to go with a larger company.  They know how to deal with natural disasters and have been doing it for a long time.  Get a cheap quote on contents insurance to protect your personal belongings.

Being in the mortgage industry for over 10 years, I can tell you that even though you get a home inspection, it does not guarantee the items are not going to break down the minute you close on the mortgage.  I would tell the customer point blank, “If I were you, I would get home protection insurance.  It’s cheap and a great buy”.  The customer would rely to me and say, “The home just was inspected”.  And I would say, “it doesn’t matter if the home was inspected, if something breaks down the minute you close on the mortgage, it’s your responsibility!”  You wouldn’t believe, about 80% of the time I would get a “no”, or a, “I’m not going to pay for that”.  And I would say, “Suit yourself”.  Then about three to four weeks later, I would get a call from the buyer after the home was sold.  I would answer the phone as I always do.  Needless to say, the buyer is yelling and irate on the phone.  I say, “Slow down, what’s wrong?”  The buyer says, “I just closed on this house three weeks ago.  Last night it started to rain, and then it poured so hard that my roof is now leaking and my air conditioning unit is not working.  It’s going to cost me $3,000 to fix everything!”

I don’t want to say I told you so to the buyer, but “I told you so!”  Sounds funny but unfortunately, this is a true story.  And, it won’t be the first time or, I’m sad to say, the last time.  It does happen.  And, it’s not the fault of the home inspector either.  Things just break down.  It’s just like when you’re trying to save money and buy a used car.  You want it cheap!  A cheap car usually means no warranty on the vehicle.  Then you drive it off the lot and it breaks down on the way home from buying it.  Ever heard that story before?  Buying something affordable and inexpensive doesn’t mean you shouldn’t buy home protection insurance.  It’s a smart way to protect your recent investment from going kaput on you either the minute after you buy or, even when you’ve owned the home for some time.  You can purchase this plan anytime you own the home.  It’s a great way to save yourself from disaster in your home whether you just bought it or if you have owned it for quite some time.

Did you ever see the movie “The Money Pit?”  We all think that movie is absolutely funny.  But if it were you in the movie, would it be as funny?  I wouldn’t think so.  It’s a great example that if you had Home Protection Insurance, you wouldn’t need to fork over thousands of dollars to contractors.

Having unemployment disability insurance is a way to protect yourself in the event of something happening in your life like, an on the job accident, injure yourself at home, a car accident, or if you get laid off.  It’s a cheap monthly premium that you buy in the event you cannot make your mortgage payment.  If it’s an injury, show proof from your doctor stating that you cannot return to work and you are on temporary disability leave.  If it’s unemployment, show proof or a termination letter from your employer stating you have been terminated from the position.  It’s as simple as that!  In return, the mortgage payment is paid for by the insurer which pays the principal and interest payment.  A bonus is that the principal and interest payment does not go back into the mortgage.  The mortgage payment is paid, just as if you made the payment.  The property taxes and insurance are still your responsibility though.  Some insurance companies allow you to be out of work up to one year and continue to pay your principal and interest payment.  In a case where you were terminated from your job, you can file and collect for unemployment and still have your mortgage payment paid for by your unemployment disability insurance.  And, if for some reason you became permanently disabled and could not perform your job, your disability insurance could protect you for a set number of years.  It takes a long time for your lawyer to settle on a claim and you will not see money being exchanged for either months, or possibly years.  It all depends on your policy and your coverage.  It’s a great, secure way eliminating the worry of making the mortgage payment.  You have enough to worry about making payments.  This way it’s just one less payment to worry about.  Take time to understand the importance of having unemployment disability insurance and see how it can help you feel more secure and live worry free.

The positives are, if you are at a high risk of losing your job, you should consider this type of coverage.  This type of protection may be beneficial for a homeowner who does not have the adequate savings or reserves in the bank if there was an accident or emergency.  There are other benefits of having this type of coverage.  For instance, you do not need to have a physical examination by a physician if you have health problems, or a health risk, this program may be a solution.  This type of insurance is easy to buy.  You can select a provider either during, or after the mortgage loan closes.  There are many companies that offer this type of protection when you close on your home.  You will get stacks of mail wanting you to sign up for this program.  Be careful though, every company that offers Mortgage Payment Protection has something different to offer.

There are negatives in Mortgage Payment Protection Insurance.  The payment only goes toward principal and interest, and not the property taxes or insurance.  The premiums can be expensive when compared to term life insurance premiums, which generally provide better value on the dollar, and especially if you are in good health.  Also, each company that offers this type of protection has something different to offer the homeowner.  Focus on reading the specific policy from every company you select because every policy is different and not the brochure.
Here’s a good example, most homeowners don’t realize what would happen to them, or their family if they were in a car accident.  Let’s say, your driving to work, and a car collides with your car at 50m.p.h causing major injuries to you, and your car.  Car insurance pays for your medical bills and your car, but what happens when you are in a serious car accident and you were admitted to the hospital for let’s say two weeks?  Let’s suppose that after being in the hospital for those two weeks, the physician says that you cannot go back to work for a month.  Maybe, even two months!  If you hire an accident attorney, it takes time to file a claim and to collect on the damages from the accident.  So, in the meantime, how are you going to pay the mortgage?  This is where Mortgage Payment Protection Insurance is a key element in providing you the safety and security for you and your family in the event of a serious injury, disability, or major health problem so they can focus on you and not worry about the mortgage payment.

But is Mortgage Life Insurance Important?  Well, it all depends on the consumer.  In a short, brief synopsis, Mortgage Life Insurance is a protection Life Insurance Policy that promises to pay off the remaining balance of your mortgage in the event of death or disability.  It frees your family from having to worry about making a mortgage payment every month.  This is an optional program that is totally up to the consumer.  Every Insurer has a different type of coverage or policy and, every one of them is different.  Cheap and affordable policies are difficult to find.  Here are the not so benefits when it comes to having Mortgage Life Insurance:

1)    As you pay down the term of your mortgage over the years, whether you have a 15, 20, or 30 Year Loan, the value of your mortgage life insurance policy gets lower since the balance of your mortgage goes down.  If the balance of your mortgage let’s say, goes down to $10,000 at the end of the mortgage term, then your family will only get $10,000.  So, in essence, your potential payout decreases, but your monthly premium will continue to be the same since when you originally started the policy.

2)    The Bank is protecting their investment!  Think of this, what happens if the provider of the family dies, or becomes disabled?  The chances of the home going into bankruptcy or default are incredible.  Do you think the banking institutions want to pay money each month to protect their investment?  In so, the banking institutions are enabling the consumer to pay the insurance premium so they don’t half to!  What a great business decision, but maybe not a good decision for you.

There are companies out there in the market that are good, offering low rates per month, and offering solutions and options that are molded to the consumer.  Some of these plans have a lower monthly premium as the loan balance diminishes.  Some people prefer a simple life insurance policy.  By having a life insurance policy, the consumer doesn’t need to be concerned about the balance of the mortgage and can focus on the guaranteed payout.  Either way, if you a concerned family provider, you must protect your family from the reality of them losing their home after you pass away.  The sad story is, none of us think about that idea until something happens or, it’s too late.  It’s only pennies a day that can provide your family with the added security of having insurance long after your unable.  It’s worth having if you weigh out all the options of the program.  Things that are most important are, who has the lowest rate per month, who has the most coverage, and which company has the biggest payout in the event of death or disability.  All Mortgage Insurance quotes will fluctuate depending on the specific program that suits you.

Here’s a good example of when you need Mortgage Insurance and how to keep your payments lower:

Scenario 1 – You are purchasing a primary home on a 30 Year Fixed Program for a purchase price of $200,000 and you decide to put 10% down, take .50% to .60% into $180,000 (loan amount) which equals $900 to $1080 a year, divide into 12 months, comes to an estimated $75 to $90 a month.

Scenario 2 – You are purchasing a primary home on a 30 Year Fixed Program for a purchase price of $200,000 and you decide to put 5% down, take .80% to .90% into $190,000 (loan amount) which equals $1,520 to $1,710 a year, divide into 12 months, comes to an estimated $127 to $143 a month.

Comparing the two scenarios, Mortgage Insurance is cheaper and more affordable if you put more money down on the home you are looking to buy.

There are government type programs available for all homeowners that want little cash to purchase a new home.  For example, going FHA or VA are incredible programs that require little or no money down.  You can only use these programs on a home you will consider your primary home, and only home, at the time of purchase.  In order for you to take advantage of a VA Loan, you must be a qualified veteran of the U.S. Armed Forces.

Scenario 1 – You are purchasing a primary home and do not own another home at the time of purchase.  The Purchase Price is $200,000 and you would like to come up with little or no money.  FHA homes require the buyer to come up with 3% down equaling $6,000.  The seller can pay up to 3% of the purchase price towards closing costs and prepaid items such as insurance and reserves for property taxes.  So, the loan amount would be $200,000 minus 3% down, equals a loan amount of $194,000.  FHA has a Funding Fee of 2.25% of the loan amount, which equals $4,365.  The FHA Funding Fee can be rolled into the mortgage, making the loan amount $198,365.  The Mortgage Insurance is lower with FHA, making the percentage estimated .50% which comes to $992 a year, divide by 12 months in a year, equals an estimated $82.65 a month.

The FHA Program is a great program to use when you want to put a minimal 3% down and want a discount on a Mortgage Insurance quote.  Please remember, if you keep the home for a short time, part of the FHA Funding Fees’ unused portion may be refunded.  Either way, please make sure you get an Estimate of Closing Costs in order for you to determine the Mortgage Insurance Quote.