Are you looking to purchase a new homeowners insurance policy in North Carolina? Then you’ve come to the right place. This handy guide contains all the information you need to know about purchasing homeowners insurance in the Tar Heel State. Whether you want the most affordable premium possible, or whether you’re looking to make sure you buy the right coverage, we can help clear up any confusion you may have about the shopping process.
Most homeowners – especially those who want to protect their dwelling and their personal property from potential perils – will be looking to buy a Special Form HO-3 policy. These policies include nearly limitless coverage for your outer structure, as well as fairly comprehensive coverage for your property from certain named perils.
|Types of Coverage||Coverage Amount|
|Replacement Cost (Dwelling)||$200,000|
|Replacement Cost (Contents)||$100,000|
The estimated coverages listed in the chart above are based on industry standards, as well as average home prices in the state. Naturally, your coverage needs may be different; your home may be less expensive, or you may have personal property that cannot be replaced at only half the value of your structure. Be sure to take an accurate home inventory, and talk to your agent about what coverage options and limits are right for you.
North Carolina has hundreds of miles of coastline bordering the hurricane-prone Atlantic ocean. As such, getting affordable homeowners insurance that also protects you from the most common perils becomes more difficult the farther east your home is located. Inland areas, on the other hand, may see much lower rates.
As low as some of these rates may be, you need to understand that there will be significant fluctuations from one company to the next. Shopping around and requesting different quotes from several companies is the best way to make sure you don’t end up overpaying. As you can see in the graph below, you might be able to save yourself a decent chunk of change just by shopping around:
For most homeowners, especially those in North Carolina, home insurance is a necessity. This reality exists regardless of the fact that neither state nor federal law mandates it the way they do with other insurance products (like car insurance, for example). Your mortgage lender will probably require it, and it’s a smart investment even if you own your home outright. After all, you don’t want to suffer the financial devastation of having your home destroyed by a natural disaster with no insurance coverage to help you recover, do you?
How much is your refrigerator worth? What about the light fixtures around your home? Or your electronics? These are important questions you will need to be able to answer before you purchase a policy. If you are unsure, you could waste thousands on inflated premiums by over estimating your property’s worth. You may also end up purchasing too little coverage, which could become a serious financial burden if your insurer doesn’t pay out enough on your claims to actually repair or replace the damage.
The most obvious perils that North Carolina residents have to worry about are hurricane-related. But those aren’t the only disasters that can befall your home and/or property:
These terms get thrown around a lot when you’re negotiating the specifics of your homeowner’s insurance policy. When it comes to replacement cost, you’re usually talking about damages incurred to the outer structure of your home. The good news is that these claims are usually paid out at “replacement cost” – which means you get 100% of the funds needed to fix or replace structural damage up to your coverage limits. This leaves you with less financial responsibility after your deductible is paid, but your annual premiums will be higher as a result.
Actual cash value, on the other hand, typically refers to personal property covered by Part C of your homeowner’s insurance. It pays out less when you file a claim on a significantly depreciated item. While you absorb more of the financial responsibility for replacing or repairing the damaged property, your premiums will be lower on average.
Will your homeowner’s insurance provider run a “hard” or a “soft” credit check on you if you ask them for a quote? In North Carolina, the answer to that question isn’t so cut and dry. Most homeowners insurance companies take mercy on potential customers and run a soft check when they give you their first estimate. This doesn’t have the repercussions of lowering your credit score the way hard checks do, but you may not get the most accurate quote from your insurer this way. Be sure to ask the agent you talk to about their credit check policies, as well as how much it can influence you actual premium costs.
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:
NC Department of Insurance
Public Information Office
1201 Mail Service Center
Raleigh NC 27699-1201
Phone: 919-807-6011 | Fax: 919-733-0085