Top 10 Fire Insurance Buying Mistakes

Fire insurance claims continue to mount each year, despite an unprecedented effort to educate more people on fire safety. Lately one of the biggest pushes I am trying to make is to educate more people on how to buy a fire insurance policy. With fire insurance policies escalating each year, it’s important that you educate yourself on the latest buying strategies for purchasing the right coverage for your specific needs. Unfortunately most people put more time, effort and thought on where they’ll spend their next vacation than they do on buying an insurance policy.

Probably one of the biggest mistakes people make, aside from the 10 mistakes I’ll cover shortly, is not staying educated on fire insurance options. The more informed you are about your choices the better buying decisions you’ll make in the end. Like most things in life, insurance policies change, companies expand their coverage, they increase the cost of premiums, and exclude coverage. It’s important to keep up to date on any of those changes – if you want to get the most for your money.

Here’s 10 mistakes people make when buying fire insurance coverage.

1. Not taking a large enough deductible to get a discount. Typically, fire insurance policies start giving discounts at or above $500. Above the $500 level, the higher the deductible the higher your discount.

2. Mistakenly assuming your fire insurance policy cover contents along with your dwelling. Never take for granted what your policy covers, always read the fine print.

3. Assuming your policy covers the replacement cost of personal property items. Some policies cover the actual value of items at the time they were destroyed by the fire. Make sure to read your policies fine print. Replacement cost coverage generally cost more.

4. Situations resulting from fire that you may not be covered for in your standard fire insurance policy are:

– Fire and explosion resulting from an earthquake or other natural event. – Riots or other civil disobedience. – Theft or burglary during or after a fire.

Check with your insurance agent for further details on your specific policy and dwelling.

5. Not comparison shopping for the best fire insurance policy and settling for the first agent that offers you a policy.

6. Not checking the background and reputation of the fire insurance company you choose to do business with. What’s their complaint record? Claims Record?

7. Not taking advantage of the discount offered by most insurance companies. For example, not having your cars insured with the same company you have your home insured with.

8. Not taking advantage of the discount offered by most insurance companies by using smoke, fire and other detectors in your home.

9. Not making a written list, video or photo inventory of your homes contents to give your insurance company should you need to file a claim and establish value.

10. Not comparison shopping for a better rate, coverage or discounts at least once a year.

By avoiding these simple mistakes, you’ll give yourself an edge and the proper financial protection not only from fires – but also from fires insurance.


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