Perpetual homeowners insurance is not free, but the benefits can make you enough money to make you think seriously about using it to protect your home.

 For those who have enough cash on hand, a type of homeowner’s insurance known as “perpetual insurance” may just be the thing you’ve been looking for.  This type of homeowner’s policy is written in a way that it does not expire – it just keeps renewing itself and exists for perpetuity.

 How does it work?  The insured deposits money with the insurance company, for the entire life of the risk.  This money is called “deposit premium”.  The amount of the deposit premium is quite high – usually about ten or more times higher than the cost of an average, annual premium for a one-year homeowner’s policy.  But once in effect, the policy stays in force, without any cancellation.  It simply rolls over from year to year. 

In order for this to be a viable option for the insurance company, the amount the insured deposits with the insurer must obviously be enough so that the insurer can invest the money and make enough from the investments to be able to cover any losses and operating expenses it incurs.  The insured receives some benefit from the arrangement, including enjoying the convenience of not having to worry about paying renewal premiums each year and/or not having to shop around for coverage year after year.  No direct interest is paid to the insured on the money deposited with the insurer, but the amount you save year after year is, in  fact a form of tax free interest.

For instance; Say your yearly premium is $1,000 and the company requires you to pay $10,000 for the policy. You can cancel any time, so let’s say you cancel at the end of the first year. You have saved/made $1,000 and you get your whole $10,000 back. So, in effect, you made 10% interest on your investment. That is pretty good.

This is a form of homeowner’s insurance that you don’t really hear of too often, most likely due to the high outlay of money required for such an arrangement.  But if you have the money and are willing to pay for the convenience, you should ask a South Carolina insurance agent about it.  

Jennie Segurado
A lifelong insurance professional.
Reach Jennie at: JennieSegurado@Insurance.sc

Here is some wisdom about how to save money when buying Homeowners Insurance from a Gal I really trust. Me!

Most of us don’t really enjoy looking for insurance . . . it’s like pulling teeth.  It’s not a pleasant experience, but a lot of people find themselves in the position of having to shop for homeowner’s insurance every couple of years or so.  However, it really does pay to shop till your drop when it comes to getting the best rates for your home.

As an example, a couple of years ago, I received my renewal notice in the mail for my homeowner’s policy and nearly hit the roof.  The premium on my policy for my modestly sized home, although I had submitted no claims during the year, had nearly tripled in cost!  It had gone from approximately $600 per year to almost $1,500 per year!  I was flabbergasted and wasted no time getting on the phone with my agent, to find out what had caused such a high increase.  I was told that everyone living in my particular county in SC had received such a high rate increase, and it was simply a matter of claims experience in the county for the previous year having been extraordinarily high.  He did offer to “shop around” for me to see if he could lower my rate a bit, but called back a day later saying he didn’t have any luck and I was getting the best rate I could possibly get in my county. 

Not wanting to believe this forecast of doom, I set out on my own to try and find another insurance carrier that would offer at least reasonable rates for covering my home.  True, I did run into several of the big name carriers who either refused to even issue a policy in my county, or ones that quoted a rate similar or even higher than my exorbitant renewal premium.  Undaunted, though, I pressed on, and eventually found a well-known insurance company that quoted a rate only a couple of hundred dollars higher than my old rate, before the renewal.  Wary of the relatively “low” rate, I thoroughly checked into the coverage limits, deductibles and exclusions on the policy, and found that the company was indeed offering me almost the same exact coverage as my current policy, at much cheaper rates.  Naturally, I jumped on it and have been extremely satisfied over the last 2 years, without receiving any renewal rate increase this past year. 

The moral of the story here is, “If at first you don’t succeed, try, try again!”  Persistence can and will probably pay off if you can stay the course and wade through the insurance jungle.

There are still good companies out there who offer rates that won’t break the bank.

A Lifelong Insurance Professional

Reach Jennie at:    JennieSegurado@Insurance.sc

Hurricane Ike has turned out to be a nightmare unlike so many other storms that threaten but never deliver, destroying homes in several gulf coast states with wind and water, and certainly will tax the insurance industry’s ability to respond to such large scale devastation.

Planning for these kind of events sometimes seems like a waste of time but a hurricane is no joke, and everyone knows that it’s too late to buy homeowner’s insurance with windstorm/hail protection once a hurricane sets its sights on your region – even as far as a week to 10 days out in the forecast.

Ike has crushed a large area of low lying Texas and we in the Low Country of South Carolina can now appreciate that we were very lucky that Tropical Storm Hannah gave us just a wink as she passed by, and that her winds and rains were not too severe.

As I write this, Hurricane Ike is still unleashing its fury on Houston and Galveston, Texas, with 110 mile per hour sustained winds and flooding rains.  Windows are being blown out in downtown skyscrapers and shingles are being torn off roofs.   Ike continues northward now to wreak more havoc with northeastern Texas and maybe even some northwestern Louisiana residents.  Are all the residents prepared?  Did everyone who needed to evacuate do so in time?  There are reports coming in now of people being trapped in their homes, and I’m sure we’ll be seeing on the news tragic stories of pets being lost . . . of belongings being swept away by wind and tide.   A lifetime of memories and collectibles can be destroyed in precious little time when a big storm blows through.

Your home is supposed to be your sanctuary.  The one place in which you can feel safe from harm.  But in a hurricane or other natural disaster, all bets are off.  Are your home and its contents protected in case an Ike heads your way?  See your agent today. Your agent will review your homeowner’s policy and give it a checkup to ensure it has kept up with inflation and that you have adequate coverage. Have you built an addition to your home?  Have home values increased where you live?  Many things can trigger a necessity for an increase in your coverage amount.  Are you familiar with your windstorm separate deductible?  Does your policy include flood insurance?  Many don’t.

Here are some tips for protecting your property before a big storm hits:  (1) Make an inventory of your possessions and store it off the premises.  In the event that a hurricane or tornado does damage your home, this list will help your agent in filing a claim.  (2) If possible, in the face of an approaching storm, take your valuables to another safe location, even if you are not ordered to evacuate yourself.  Even though you may survive a 5” flood in your living room, your valuable Persian rug may not!  (3) Before a storm arrives, secure your property (such as tying down picnic tables, outside furniture or any other loose, potentially hazardous “flying” items). 

 With  more of the hurricane season left to go, it’s best to be wise, be insured and not to take any chances!

Jennie

Jennie Segurado - A lifelong insurance professional.

Reach Jennie at:    JennieSegurado@Insurance.sc

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