Cheap Buildings Insurance – Getting The Coverage You Need

2007-03-08 10:33:40

( Insurance )



Building insurance covers your property against losses caused by specific perils such as fire, windstorm and explosion. It is to your advantage to purchase building insurance if you own a property. And, if it’s still mortgaged, your lender will require that you have building insurance.

To get cheap buildings insurance, you’ll have to shop around. But first, get an idea on the rebuilding cost (actual amount a builder would charge to replace the damaged property) of your property. In this way, you know the exact amount of coverage needed for your building. A licensed surveyor can assess the rebuilding cost of your property for building insurance purposes.

Buying cheap buildings insurance policy with an understated value of your property is counter-productive. You must take note that most building insurance policies carry a coinsurance clause (one that requires the total insurance carried on the building must equal a stated percentage of the value of your building).

If you insist on buying a building insurance understating your property’s value, the insurance company can penalize you. An insurer has the right to pay less than the amount of claim for the reason that you didn’t buy the proper amount of insurance coverage. To avoid this penalty, make sure that you get the right amount of coverage for your property.

If you live in an area where there is a threat of subsidence, you will have a hard time finding cheap buildings insurance. Subsidence increases your property’s risk level and thus, increases building insurance premiums.

A building insurance policy that gives you sufficient cover may not necessarily be cheap buildings insurance. But once you find one, you should make sure the policy remains in effect and keep the amount of cover updated. If you make improvements, inform your insurer so that your building insurance policy may be adjusted accordingly.


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