First time home buyers in Ohio have a lot to look forward to. Your property values are much lower than the national average, and so are your homeowners insurance premiums. Although the process of shopping for home insurance can be unpleasant and tedious, you will be sure to get a great deal of you follow our handy advice in this guide.
Many people often wonder what the most popular type of homeowners insurance is. There is a simple answer to that question: the HO-3 special form policy. This policy provides more comprehensive coverage than almost any other homeowners insurance policy, but it does so at some of the most affordable rates available in the market today.
|Types of Coverage||Coverage Amount|
|Replacement Cost (Dwelling)||$150,000|
|Replacement Cost (Contents)||$100,000|
The chart above reflects average coverage amounts for a $150,000 home. Typically, liability coverage is set at at least $100k, medical payments coverage options start at $1,000, and property coverage should be at least 50% of your home’s total value. As far as your deductible goes, you have the option to raise it above $500 if you want to lower your annual premium. But you can’t set your deductible below five hundred dollars.
In general, Ohio homeowners insurance premiums can be around $300 cheaper than other states in the nation, with certain exceptions. Ohio cities which are located near water, the southern border of the state, or in high crime areas will see higher premiums due to the increased frequency of claims filed. Toledo, as you can see from the charts, is a prime example of this phenomenon.
The only entity that can compel you to purchase homeowners insurance is your bank – specifically, the bank that is managing your mortgage loan. You may be living in the home and making payments on it, but until it is fully paid off, your bank still retains a majority stake ownership in that asset. Naturally, they want that asset protected. Even if you do own your home outright, either by paying cash or having finished paying off your mortgage, it’s still a very good idea to have financial protection covering such a large, expensive investment.
Ah, the home inventory…it’s as necessary for the insurance purchasing process as it is difficult to do right. But do yourself a favor and take your time with it. Catalogue every major (and to some extent, minor) piece of property you own. And make sure you record its true value while you’re at it. Overestimating its worth will inflate your annual premium, costing you more money than you need to spend. But underestimating your property just to get a lower insurance rate may cost you bigly if you ever have to file a claim.
The basic HO-3 policy that many Ohio home insurance companies offer does not necessarily cover every potential disaster that your home or your property may face. Before you sign the paperwork on your policy, make sure to talk to your insurance agent about:
Before you finalize your homeowners insurance policy, you’ll need to get a firm understanding for the terms “replacement cost” and “actual cash value”. Replacement cost usually refers to claims filed for damages to your structure, and will honor 100% of the replacement/repair costs minus your deductible.
Actual cash value usually covers your personal property, and doesn’t pay out as much as replacement cost coverage; however, it will make you eligible for lower premiums. An example of actual cash value would be if you filed a claim on a stolen TV. The older the television is, the more it will have depreciated in value since you purchased it. And the more depreciation there is, the less your insurance company will pay out on your claim.
Ohio is one of many states where homeowners insurance providers use your CLUE report when determining your premiums. A CLUE report is a limited snapshot of your credit history, usually only going back seven years and only showing your provider your history with other insurance companies and similar entities. This can help get you a better rate, and prevents too many “hard” credit checks from ruining your total credit score.
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:
Ohio Department of Insurance
50 W. Town Street
Third Floor – Suite 300
Columbus, Ohio 43215
Consumer Hotline: 1-800-686-1526