North Dakota ranks as one of the top 10 most flooded states in the country. More than 1,500 home owners filed claims with the National Flood Insurance Program, which paid out more than $93 million to policy holders. This danger highlights the importance of home insurance in North Dakota, which also sees its fair share of winter storms, extreme cold, and tornadoes.
How Much Does Home Insurance Cost?
The average cost of a home insurance premium in North Dakota was $895 in 2010, according to the Insurance Information Institute. Home insurance companies in North Dakota consider several factors when they determine how much your premium will cost, starting with the amount and type of coverage you buy. Standard home insurance policies have actual cash value coverage, which reimburses you for property lost on a value minus depreciation basis. A special endorsement, known as replacement cost coverage, reimburses you for the full value of the items lost. However, since it is an addition to your policy it will increase the cost of your premium. The size of your deductible and your credit history also determine your premium.
Home insurance providers also consider your residence’s proximity to a fire station; its age, condition, and the materials it was constructed with; and its location, which includes the crime rate in the area. Fortunately, there are ways you can lower your premium. The installation of safety devices, including smoke detectors, burglary alarms, or sprinklers, can qualify you for a discount. You can also qualify for a multi-policy discount if you have more than one type of insurance with the same company. Some home insurance companies also offer new home, claim free, and senior citizen discounts.
What Does It Cover?
Homeowners insurance covers the structure of your home, personal property damage, personal liability, medical payments, and additional living expenses. It covers damages caused by basic perils named in the policy, which include fire, lightning, hail, explosion, aircraft, vandalism, theft, and hail. Broad coverage policies provide additional coverage for falling objects; volcanic eruption; weight of ice, snow, or sleet; accidental discharge of water or steam; collapse of a building; and more. These policies do not cover damages caused by flooding, sewage backup or seepage, earthquakes, war, neglect, wear and tear, and nuclear accidents.
Liability insurance is usually standard in a homeowners insurance policy. It covers the policyholder’s legal obligations if another person outside your household is injured, or their property is damaged on your residence. Insurance policies cover liability at a minimum of $100,000. Many special and comprehensive policies provide up $300,000 of coverage, according to the North Dakota Insurance Department. Report incidents that happen on your property to you insurance company immediately. If a claim is made against you later on, sometime after it had occurred, you may be denied coverage.
Do I Have to Get Home Insurance?
Although North Dakota doesn’t require its residents to have home insurance, mortgage lenders typically require coverage. That being said, having home insurance is a wise move because it can make the difference between paying thousands of dollars to replace or repair property that the insurance policy would have covered.
Optional Coverage to Consider
- Flood. Homeowner’s insurance typically excludes water damage and flooding. Flooding insurance is provided by the National Flood Insurance Program (NFIP). Flooding is a constant risk in North Dakota; the NFIP paid out more than $93 million in claims to policy holders in the state in 2011. The NFIP provides coverage limits up to $250,000 for the structure of the home and $100,000 for a home’s contents. Keep in mind, however, that a 30-day waiting period goes into place before flood insurance goes into effect. The average cost of flood insurance in North Dakota is approximately $500 a year, according to the North Dakota Insurance Department.
- Windstorm. A standard homeowner’s insurance policy will cover windstorm and hail damage, and homeowners may become eligible for discounts by installing of storm shutters and wind-resistant laminated glass. Some insurance companies require a separate deductible for wind and hail claims, generally $1,000, or a percentage deductible for wind and hail at one or two percent of the dwelling coverage amount.
Mobile Home Insurance
Mobile home insurance, or manufactured home insurance, features property coverage, liability considerations, and casualty coverage, and will provide loss of use coverage to insure additional living expenses if the mobile home is not habitable after loss. Loss of use coverage helps pay for temporary housing, meals, and storage of property. Renewal depends on regular payment, the truth of insurance claims and insurance application, and immediate repair of damages after a claim, before further loss occurs. A mobile homeowner’s policy is usually more limited than a standard homeowner’s policy, and may cover actual cash value instead of replacement cost.