Monthly ArchiveMarch 2007
Chicago Property Administrator on 01 Mar 2007
As an adult living in Chicago, working day in and day out, living on your own the thought of establishing a financial foundation should be a priority, and part of that includes purchasing some insurance. There several reasons insurance companies can find to disqualify you for the more cost-effective plan…that’s why it’s important to establish a record of financial stability, responsibility and protection of your valuables.
What does protection of your valuables have to do with insurance? Well most insurance companies evaluate things on a scale and underwriters just do it at an extreme. If you show a history of purchasing, say…car insurance and you don’t have any accidents, at least none that were your fault; this is favorable in terms of begin evaluated for other types of insurance.
So what’s this got to do with YOU and owning a home? Well, the first step before you own, is you rent! Everyone has done it, but very few take the time to take advantage of building a history of being insured early on. Renting is your first opportunity, while on your own to establish and insurance history.
People who rent their home often make the mistake of thinking that the
landlord’s insurance covers their possessions in case of a fire or
other catastrophe. Not true, you need your own insurance. Relatively
inexpensive, renters insurance protects the things that you own. It
provides liability coverage, protection from lawsuits resulting from
harm that you, your pets or your family cause to other persons or
damage to their property. Renters insurance also helps you establish a
good insurance track record, or loss history. If you show that you are
a responsible insurance risk, you’ll have no trouble getting insurance
when you eventually buy your own place.
If you are living in a condo or coop, you depend on
two insurance polices for protection: your own coverage and the
insurance purchased by the condominium or co-op board for the common
areas of the property that you share with the other owners, like the
roof, basement, elevator, boiler and sidewalks. The condo or co-op
association may be responsible only for insuring a unit up to its bare
walls, floor and ceiling. The owner may have to insure kitchen
cabinets, built-in-appliances, plumbing, wiring, bathroom fixtures and
so on. Read the association’s bylaws and/or proprietary lease to better
understand where the association’s responsibility ends and yours begin.
If you’re buying a home, and have a mortgage, in
most cases you will need to purchase homeowners insurance. The cost
will vary according to the size and construction of the home; where it
is (proximity to the coast or other natural hazards, e.g. fault line,
wildfire zone); fire safety features; anti-theft devices; and the
property’s loss history. Insure your home for the cost of rebuilding
it, not the market price. And make certain that the value of your
insurance policy is keeping up with increases in local building costs.