New York is no stranger to extreme weather conditions. The Empire State has seen its fair share of hurricanes, including the recent Hurricane Sandy, thunderstorms and lightning, floods, and blizzards, all of which have caused millions of dollars in property damage over time. Home owners in New York should be aware of the hazards and purchase a home insurance policy, which can help mitigate the financial risk that comes along with extreme weather conditions.
How Much Does Home Insurance Cost?
The average monthly cost of home insurance in New York in 2010 was $1,044, according to the Insurance Information Institute. The amount your premium costs depends on a number of factors, including the age and condition of your home, the materials used in its construction, its location, crime rate, and its proximity to a fire hydrant or fire station. The amount of coverage and the deductible will also determine how much you pay for your premium.
Most home insurance companies offer discounts if you have certain safety devices installed in your home, including smoke detectors, burglar alarms, and sprinklers. Discounts may also be available if you have storm shutters, wind-resistant laminated glass, and impact-resistant roofing on your home. Additional savings are available for home owners who package their home insurance together with other types of coverage, such as automobile insurance.
What Does It Cover?
Standard home insurance policies in New York cover damages to the structure of your home, other structures on your property, and the items within your home from fire, windstorm, hail, an explosion (excluding steam boilers), riot, civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief, and theft. A broad form policy insures against the perils listed on a standard policy as well as additional perils, such as falling objects; weight of ice, snow, and sleet; and damage from the overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire sprinkler system. However, most policies don’t cover damage caused by floods, earthquakes, and nuclear accidents.
Liability insurance is standard in most homeowner’s insurance policies and covers injuries to another person or damages to another person’s possessions that occur on your property due to your negligence. If an incident takes place on your property, for instance, your dog bites a neighbor, it is important to contact and report the incident to your insurance company immediately, even if you don’t know if a claim is going to be made against you, otherwise you may be denied coverage if the claim is filed against you later on.
Do I Have to Get Home Insurance?
Home insurance coverage isn’t required by New York state law, but you should consider getting it because it can protect you from the financial risks that come along with owning a home. However, most lenders require you to have a home insurance policy before they’ll finance the purchase of a new home. For more information on home insurance check the New York State Department of Financial Services website.
Optional Coverage to Consider
- Flood. Losses from floods are not covered in most homeowner’s policies. A separate policy for loss caused by flood or mudslide is available under a separate policy issued through the National Flood Insurance Program if the residence is located in a community designated as a flood hazard area that takes measures to reduce future flood risks. The majority of residential areas in the state participate in the National Flood Insurance Program. Communities participating in the National Flood Insurance Programs can choose coverage limits up to $250,000 for structure and $100,000 for contents.
- Fire and Lightning. Standard homeowner’s insurance policies generally include fire and lightning coverage, but some insurance companies offer discounts if the policy holder installs fire alarms, sprinkler systems, fire extinguishers, or other protective measures. The New York Property Insurance Underwriting Association is an association of all insurance companies that offer fire insurance in New York State, in addition to extended coverage options. The cost of homeowner’s fire insurance coverage depends on the building’s location to fire protection, and the building material’s resistance to fire.
- Windstorm. New York homeowners should be aware of hurricane season, which generally runs from the beginning of June to the end of November. Approved insurance programs provide windstorm coverage subject to certain mandatory deductibles. These deductibles range from 1% to 5% of the insured amount, with optional higher percentage deductibles also available. Discounts are available to homeowners who install storm shutters and hurricane resistant laminated glass on windows and doors. Keep in mind that some damage in a hurricane is caused by flooding, which is typically not covered in windstorm or standard homeowner’s insurance.
- Earthquake. New York may not be known for its earthquakes, but they do occasionally strike. The largest recorded earthquake, a magnitude 5.8, occurred in 1944 near the U.S.-Canadian border. Although no injuries were reported it still caused approximately $2 million in damages, including to chimneys, house foundations, and plumbing, according to the U.S. Geological Survey. Although they don’t happen very often it may still be a good idea to purchase earthquake coverage, which is not included in standard homeowners insurance policies. Earthquake insurance rates are determined by age of home, construction type, and location. This type of policy usually has a high deductible ranging from 10% to 25% of the replacement value of the insured structure. It’s important to research the earthquake hazard in your area and secure the contents of your home.
Mobile Home Insurance
Mobile home or manufactured home insurance may include: personal property protection, family liability protection, guest medical protection for visitors injured at your home or on your property, structure protection, and additional living expenses for costs or temporary housing during home reconstruction from fire, vandalism, landslide, falling objects, explosions, off right-of-way collisions, attempted or actual burglary or robbery, and water damage from bursting pipes. Just like a standard homeowner’s insurance policy, coverage renewal depends on regular premium payment, truth of insurance claims and factors when determining insurance rates, and repair of conditions from loss before further loss occurs.