Category Archives: Rental Property Insurance

The Top Three Mistakes To Avoid When Purchasing Insurance Policies

Saving money is always a good thing, and shopping around for the best deal when purchasing insurance is a good way to save a few bucks. That being stated, it is not a good idea to reduce your coverage in order to save money. In fact, it can cost you a significant amount of money when a disaster happens to strike. You certainly do not want to be one of those people that are left holding the bag. The good news is that you can save a lot of dough and still have the proper insurance coverage if you make good decisions when choosing your insurance plans. The following information will provide you with the most common mistakes that people make when purchasing insurance policies.

Mistake #1: Insuring Your Home Based On Value Instead Of The Rebuilding Cost

Homeowners insurance is intended to cover the cost of rebuilding, not the current sales value of the property. That means when real estate prices happen to drop, it is not a good idea to reduce the amount of insurance you carry on your home. Unfortunately, far too many property owners make this tragic mistake. Instead, you should always ensure that you have enough coverage to rebuild your home, and replace all of your belongings regardless of what the current real estate market values are. A great way to save money is to raise your deductible. For example, increasing the deductible from $500 to $100 could very well save you upwards of 25% on your homeowners’ insurance payments.

Mistake #2: Choosing An Insurance Agent Solely Based On Price

While it is important to select an insurance agent that offers competitive pricing, it is more important that the agent you work with is both financially sound, and provides a high level of customer service. Often time’s consumers choose an insurance agency based on price alone. Like the old saying goes, you get what you pay for. In this case it can equal cut-rate service. Imagine having to deal with a major issue, such as a fire at your home, and it takes 20-30 phone calls before you receive a return call from your insurance agent? Quality counts a great deal when dealing with an emergency, meaning cut rate service simply does not cut it.

Mistake #3: Skipping The Renters Insurance Policy

A plethora of renters are under the false impression that if a fire, hurricane, or other insured disaster happens to strike that their landlord is responsible for everything. The truth of the matter is that you need your own insurance policy to cover your possessions and additional living expenses if you need to move out due to the disaster. Just as important, renters insurance also provides you with liability protection if a third party is injured while visiting your home and decides to sue you in court. Instead of skipping out on the renters’ insurance policy in order to save money, it is a far smarter idea to save money by bundling multiple policies with the same insurance agent. For example, if you purchase a bundle of renters insurance, automobile insurance, and life insurance it will save you money on all three policies.

In conclusion, there are things that you can do in order to save money without scarifying insurance coverage. If you have any questions, please call (508) 831-0133 to contact an associate at Zawada Insurance. We are happy to walk you through the details of your insurance policies and explain your coverage options. We look forward to helping you with all of your personal and or business related insurance needs.

True or False: Insurance Quiz

Can you guess which of these 8 statements are true?

There are myths about insurance—auto, home, health—and they persist in spite of the facts. As we’ve said in other blogs, it’s important to get the facts straight before you purchase insurance of any kind. Here are eight true and false statements to see how well you understand insurance.

  1. Vehicles stored in your home or garage are covered under your Homeowner’s policy.

False. Cars and other vehicles should be covered by Auto Insurance. Garden tractors and other related items are part of what is covered by Homeowner’s Insurance.

  1. Commercial Liability Insurance provides coverage for your employees who are injured on the job.

False. Only Workers Compensation covers on-the-job injuries.

  1. Homeowner’s Insurance is based on the real estate market value of your house.

False. Your coverage is based on what it would cost to rebuild your home. This cost can vary, so an insurance agent can help you calculate these costs.

  1. The Affordable Care Act prohibits health insurance companies from basing rates on pre-existing conditions.

True. Health insurance companies used to raise the rates for people with a pre-existing condition. Not anymore. For those who have medical conditions such as high blood pressure, asthma and other chronic, pre-existing medical issues, this is a big relief. In addition, insurance companies can’t charge different amounts for men and women, either.

  1. It’s not necessary to have Other Structures coverage in your Homeowner’s policy.

False. But this is a trick question. It depends on you, the homeowner. Your Homeowner’s policy, at least 10% of it at least, is devoted to Other Structures. These include any buildings or structures not attached to your house—sheds, barns (not used for business), detached garages, driveways and fencing. You can always add to your Other Structures coverage if you need more. But it is important to keep it as part of your policy in the event of some unfortunate occurrence.

  1. If you get a speeding ticket in another state, it WILL follow you home.

True. Not only will it follow you, but it will also affect your insurance rates.

  1. Homeowner’s policies cover flood, earthquake and other natural disasters.

True. . .and False. They don’t automatically cover these things. Make sure you have it, or add it to your policy. The majority of policies exclude types of water damage.

  1. If your boat is hitched to the back of your vehicle on the highway and you back into someone, your Auto Insurance will cover it.

True. However, it will be limited to the coverage that your Auto Insurance provides, so it may not pay for property damage, injury or loss of life.

Keep checking our blog for more tips and advice about all types of insurance.

For all your home, auto, boat and other insurance needs, please contact Zawada Insurance Agency, Inc. We’re a family-owned and operated independent insurance agency, located in Worcester, Massachusetts, serving central Massachusetts and beyond.

Rental Property Insurance

What Every Landlord Needs to Know

Some people enjoy having a rental property to provide extra income, while others have assumed the role accidentally. Maybe they bought a new house but couldn’t sell their old one. Whatever the case, if you are a landlord, you’ll want to secure an insurance policy that covers what you need. Homeowners insurance may not be good enough.

Of course, every situation is unique. You’ll have to determine what types of coverage are right for you. Landlords insurance may cost a little more, but is worth it for what is covered.

You’ll need landlords insurance if:

  • Your rentals aren’t occasional, meaning more than a few weeks per year.
  • You don’t live in the same house that you’re renting to a tenant.
  • Your original homeowners insurance policy was issued without knowledge that you may have rentals; coverage could be denied in certain situations.

What are the differences between homeowners and landlords insurance?

Personal property. Homeowners insurance will cover all kinds of personal belongings, from electronics to furniture and clothing. Landlords insurance won’t protect anything that isn’t used to maintain the property. For instance, landlords insurance will cover items such as lawn mowers or snow blowers.

Liability coverage. A homeowners policy usually covers you and relatives who may live with you, whether or not an accident happens in your home or not. With landlords insurance, if your tenant has an accident in the rental property or on the premises, you would be found legally responsible and would need to cover the cost of medical bills, etc. Liability coverage takes care of this for you, as long as the accident occurred on your property.

If you’re thinking about getting landlords insurance, here are some of the coverage options available to you:

Comprehensive Property Coverage. This covers anything that damages your property and isn’t specifically excluded in your policy.

Named Peril Coverage. This will only cover those situations that are named in your policy—fire, hail, explosions, etc.

Inflation Protection. If you need to make repairs to your rental property, you’ll be covered even if the repair costs increase.

Liability. Again, this protects you if your tenant has an accident while on the premises of the rental property.

Actual Cash Value (Partial). If a covered peril occurs, this will cover the cost to replace or repair the damaged property.

Personal Injury Protection. This is different from liability; it involves claims made against you for injuries resulting from wrongful eviction, invasion of privacy, or wrongful entry.

Fair Value Rental Coverage. If something happens beyond your control, and you suffer a loss that’s covered in your policy, due to a weather event, explosion or fire, you’ll be reimbursed for the lost income because your tenants won’t be living in the rental anymore, and will no longer be paying you rent.

If you are a landlord, you should look into the types of discounts that may be available to you. These include getting multiple policies from the same insurance company—some of them offer discounts for multi-policy customers. There may also be rewards for having a new (less than 13 years old) or renovated rental property.

For all your home, auto and other insurance needs, please contact Zawada Insurance Agency. We work to give you comprehensive coverage at a competitive price.

Zawada Insurance Agency, Inc. is a family-owned and operated independent insurance agency, located in Worcester, Massachusetts, serving central Massachusetts and beyond.