How Much Does Home Insurance Cost?
If you are looking into buying a home or are considering moving, you may be wondering how much does home insurance cost? Well, TFC can help answer that question. While we may be an auto title loan lender, we’ve been in the financial lending industry for over 20 years. We’ve helped our clients with a multitude of financial dilemmas. If it’s answers about home insurance you need, TFC can help.
What is Home Insurance?
Home insurance is similar to car insurance as it protects your car against damage or injury to persons. It protects against losses or damage by issues like fires, storms, or burglaries. If someone is injured on your property, it also covers the legal costs and medical payments for that person. Earthquakes and floods could be additional costs to your coverage plan.
For your home insurance payments, your premium payment is usually paid monthly along with your mortgage. Home insurance is almost always required with a home loan. Don’t be surprised if your lender for your home loan requires you to verify proof of home insurance.
What Does Home Insurance Cover?
Your home insurance will cover everything that includes your home like the structure, plumbing, electrical wiring, central air, and heating systems. It will also include other structures on your property like fences or sheds. Anything inside your house that are your possessions like electronics, appliances, or clothes can also be covered.
When your home is getting fixed or repaired, your home insurance will also cover the cost of the hotel room that you have to stay at. The personal liability coverage will also include the medical payments for the person injured on your property.
What Types of Home Insurance Are There?
There are different types of insurance ranging from HO-1 to HO-8. Most average homeowners will purchase the HO-3. This includes the liability cost, fire, wind, and theft, but does not include damage from floods, earthquakes, wars, or nuclear accidents. HO-1 and HO-2 will cover less than HO-3, while HO-4 is for tenants and renters.
If you live in a state where there is high risk for flood or earthquake, like California, then some insurance or loan companies will require you to purchase the additional coverage for floods or earthquakes.
How Much Coverage Should I Purchase?
When it comes to purchasing coverage, you want a plan that will cover 100% of the costs to rebuild your home. These are the typical types of coverage:
- “Actual Cash Value” coverage: This pays what the home was worth at the time of destruction, before the damage occurred.
- “Replacement Cost” coverage: Pays more of a comprehensive value of the home, before the depreciation.
- “Extended Value” coverage: This will cover 20-30% of the policy coverage limit. If you have a $100,000 policy, it will pay $120,000-$130,000 coverage.
We suggest going with the more comprehensive plan to make sure you’ll be able to account for all the damage your house receives. We also suggest a comprehensive plan for covering the contents of your home. When choosing your liability, you want it to cover the total amount of money for your financial assets: home, retirement accounts, investments, anything worth money.
Don’t forget living in a high-risk location may require any extra coverage for the flood and earthquake damages. Some of the biggest losses recorded for home insurance damage are as follows:
- Wind and hail
- Water damage and freezing
- Other property damage
- Fire, lightning, and debris
What is the Cost of Home Insurance?
To put it into a broader perspective, for every $100,000 home value you may pay about $35 per month. The U.S. average per year is $1,083. The lowest location is in Oregon where they only pay $574 average per year and the highest is Florida with a yearly payment average of $2,055.
Below are the locations where TFC holds offices:
- Arizona: $64/month, $765/year
- California: $81/month, $974/year
- New Mexico: $78/month, $937/year
TFC Title Loans Helps Damaged Homes
Do you need to cover the cost of a home damage? Maybe you just need extra cash to pay your mortgage? Whatever the reason may be, TFC Title Loans can help get you back on your feet with Car Title Loans in your area. You could get between $2,500 and $50,000 in funds. And, you continue driving your car while you pay off your loan. Don’t let a messy problem stress you out! Call TFC Title Loans today and get your money in as little as one business day.