Montana is known for its natural beauty and wide-open spaces. It’s home to part of the Rocky Mountains, Glacier National Park, and Yellowstone National Park, which attracts millions of tourists per year. Although homeowners in Montana get to enjoy the state’s natural beauty they also have to deal with its volatile weather. Wildfires, snow storms, floods, and tornadoes can cause significant damage to homes, which is why it’s important to purchase a home insurance policy that helps to protect you from a catastrophe.
How Much Does Home Insurance Cost?
The average cost of home insurance in Montana was $783 in 2010, according to the Insurance Information Institute. A home insurance policy’s premium is determined by the age and condition of your home, the crime rate in the local area, its exposure to flooding, its proximity to a fire hydrant or fire station, and other factors. The cost is also determined by the amount of coverage you need, since more expensive homes typically cost more to insure.
Some companies offer discounted rates to customers who install smoke detectors, sprinkler systems, burglar alarms, or anything else that mitigates the risk of property loss. You can also opt to lower your premium, which typically increases your deductible, or the amount of money you pay before the insurance company begins paying a loss. If you have home and another type of insurance policy, such as auto insurance, then you may be eligible to receive a multi-policy discount.
What Does It Cover?
Home insurance covers damages caused by fire and smoke; windstorm and hail; lightning; vandalism and theft; and the weight of ice, snow, or sleet. It’s one of the most important investments you can make since it will protect you from the hefty financial costs of repairing or rebuilding your home if it sustains significant damage. Home insurance policies also include liability coverage, which protects you from a potential claim or lawsuit for bodily injury or property damage that occurs as a result of your negligence. A standard policy stipulates that it will cover up to $100,000 per claim, but higher limits may be available for a higher premium. Liability coverage also pays medical expenses in the event that someone is injured on your property or through your personal activities. Policies generally include a $1,000 per person limit.
Do I Have to Get Home Insurance?
Although there’s no state law that requires you to have home insurance, most lenders won’t finance the purchase of your home unless it’s insured. Even if you don’t need the help of a bank to finance your home it’s smart to have insurance in case your home is damaged by a storm or fire since repairs can be expensive.
Optional Coverage to Consider
- Flood. Montana residents are encouraged to buy flood insurance through the National Flood Insurance Program (NFIP). Flood insurance is not included in standard home owners’ policies. However, if your home is located in an area prone to flooding, your lender must require flood insurance. Even individuals who live in low-risk areas should consider purchasing this insurance. For more information, contact the NFIP at 1-888-379-9531.
- Earthquake. While earthquakes have not occurred in Montana in the past 30 years, it is one of the most seismically active states in the U.S. Montana home owners should consider purchasing earthquake insurance, which is not included in basic policies. Available from private insurance companies, earthquake insurance comes with a separate deductible. It is available as an endorsement that can be added to existing home insurance policies.
- Inflation Guard. This coverage helps you maintain adequate protection. It is recommended that your insurance should cover at least 80% of your home replacement cost. However, this amount of coverage may not be enough in the future due to inflation. This coverage provided periodic increases in the policy limit. It allows your insurance company to automatically change your policy limit when you renew your policy. This coverage is not offered by all insurance companies.
Mobile Home Insurance
Mobile home owners can purchase a specific policy that insures mobile homes, also known as manufactured homes. In general, mobile home insurance covers the structure of your mobile home and your personal belongings. If your home is damaged by a covered peril and you move temporarily, a standard policy will also cover any additional living expenses, such as food costs, lodging, relocation, and storage expenses. Basic mobile insurance also includes liability coverage. However, keep in mind that home owner’s insurance may not cover your mobile home while it is being transported. Check your policy to determine whether exclusions apply.