There are many forms of insurance which deal with various levels of risks and various forms of cover. One of the most common forms of insurance which can be taken out by an individual is household insurance. Household insurance itself can present itself in many different forms. Household insurance most often includes coverage on the physical structure of the house and covers against damage that may occur from fire, corrosion, water damage as a result of faulty plumbing etc. but hardly ever covers against flooding as a natural disaster. The reason for this is that most insurance companies can’t afford to cover the large amount of people who put in claims after big floods. Special insurance can be taken out to cover a house against flooding as a result of a natural disaster, but such insurance plans are very expensive, especially if the insured lives in an area which is subject to hurricanes, tropical storms and generally at risk of flooding.
In some cases household insurance may cover only the physical structure of the house, but it is not necessarily the case. Many household insurance policies also include the contents of the house. In fact, between this form of insurance and vehicle insurance, they are the two forms which tend to take priority and are usually taken out first. When household insurance which covers the contents of the house is taken out, there is quite a number of procedures that need to be followed and a lot factors which influence the policy and it’s coverage. This is all so that the insured party is neither under-insured or over-insured. The insured party is required to compile a list of all the contents of the house and the purchase price of all the contents individually, so that if a claim is made, the exact value of the item is known.
Certain factors which affect the risk of insureing a house and its contents usually also affect the premiums which the insured party pays. Examples of factors which may affect the price of premiums, are the location of the house, the crime rate in that area, how far the house is located from a fire department etc. In the past, certain factors which better the security of a house and in turn the risk of the policy would also impact on the premiums the insured paid by bringing them down. If a house had electrical fencing around it for example the insurance premiums would be decreased. This is hardly the case anymore.
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Very few insurance companies actually lower insurance premiums with the installation of better security, however, many insurance companies have minimum security requirements before they provide insurance. One of the major requirements is that the insured have burglar proofing on all opening windows. It is also required that plumbing and electrical wiring be done by certified professionals.
Although it is not as popular as other forms of household insurance, it is possible to get liability insurance which applies to an individuals’ property. This basically means that the owner of the house is covered for injury that may occur on the property. Depending on the policy this form of insurance may only cover the owner and residents, or may also apply to any individual who is injured while on the property.
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