Purchasing your own home is one thing – but purchasing one in the wild tundra of Alaska is another entity all its own. You’re going to need home insurance, even if you don’t have a mortgage on your property. This untamed frontier has too many potential perils for you to risk not having your property insured.
The industry standard, and the most popular policy available from most homeowners insurance companies, is called an HO-3 special form policy. Keep in mind, though, that some companies will undoubtedly deviate from the norm and possibly craft their own unique policies. And it will be up to you to understand what your policy covers, what perils you can and cannot file claims for, your coverage limits, and your deductible(s).
|Type of Coverage||Coverage Amount|
|Replacement Cost (Dwelling)||$200,000|
|Replacement Cost (Contents)||$100,000|
Average homeowners insurance rates are pretty uniform in Alaska. This has a lot to do with the fact that most homeowners will have to worry about the same perils – such as wildfires, moose violence, winter storms, structural damage from polar bear attacks, earthquakes, and more – regardless of where their home is located. The biggest factors that will influence your annual premium have a lot more to do with the value of your home and property than your geographical location.
Just because the chart above makes it seem like there is little variety in Alaskan home insurance premiums doesn’t mean you shouldn’t try and get multiple quotes from different companies. Depending on how they evaluate your credit, it shouldn’t damage your FICO score (but we’ll talk more on that later). And the less of an effect it has on your credit rating, the more quotes you can collect for a fair and thorough evaluation.
Technically, there is no law that says you absolutely have to purchase a home insurance policy. But since most banks think they are above the law, your mortgage lender will most likely make it a mandatory part of your home loan. It makes sense, if you think about it; technically, your home still belongs to the bank until you finish paying it off. And they, just like you will whenever you do finally own your property outright, have a vested interest in protecting that asset from harm or total loss destruction.
Have you taken a home inventory yet? Because that’s something you’ll have to do before you even start approaching insurance providers and requesting quotes. If you do it backwards, it can have a serious effect on your final premium. Whether you underestimate or overestimate your personal property’s value, it’ll end up costing you in the end – either by leaving you with insufficient coverage to cover a claim, or by wasting thousands of dollars in premium payments for purchasing too much coverage.
The most obvious perils that Alaska residents have to worry about are hurricane-related. But those aren’t the only disasters that can befall your home and/or property:
It’s really important to understand what these two terms mean before you settle on a policy. Your provider may give you the option of choosing which type of claim payout you want for each type of coverage on your policy, or they may insist that you have to accept the payout they assign. Many providers will let you change from replacement cost to actual cash value payouts (or vice versa); just keep in mind that while actual cash value will lower your premiums, it won’t pay out as much in the event that you need to file a claim. The opposite is true for replacement cost coverage. You’ll receive more money for any honored claim related to replacement cost property, but your annual premium will be higher as a result.
When asking around for quotes from different companies, be sure to ask them how they evaluate your credit history before you start giving them your personal information. For the purposes of evaluating your risk and determining a premium, most homeowners insurance providers only look at your insurance score, which is a limited, “soft” check on your credit. Others, however, may go for your full FICO score. This could result in a “hard” check on your credit, raising red flags with the credit rating agencies and potentially lowering your score. And the lower your credit score, the less likely you are to get a good deal on your annual premium.
For more information, feel free to click any of the links you see in this article. They all lead to more detailed information about homeowner’s insurance, specifics on purchasing a policy, and how to find the best deal. You should also contact local resources in your state, such as:
Or contact them directly through the following resources:
Robert B. Atwood Building
550 W. 7th Ave., Suite 1560
Anchorage, AK 99501-3597
Main Phone (907) 269-7900 • Fax (907) 269-7910
TDD (907) 465-5437
P.O. Box 110805
Juneau, Alaska 99811-0805
Main Phone (907) 465-2515 • Fax (907) 465-3422
TDD (907) 465-5437