How Much Is Home Insurance: Complete Guide

August 8, 2019 by  
Filed under Finance

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How much is home insurance is not a question that’s easily answered. It’s one of the first things people ask when they consider buying or building a new home, but there is no right or wrong answer. Everyone pays a different amount, and each amount is based on specifics personal to each individual homeowner. Home insurance is required if you have a mortgage, and it’s highly recommended even if you do not. It’s the insurance that protects you if something happens to your home or your belongings. You never know what might happen, and you need the kind of protection homeowner’s insurance offers.

How much is home insurance is a question everyone asks, and it’s because it affects how much home you can afford. When you’re buying a home, you must know how much it will cost you to pay for the house. It’s not just your mortgage you’re paying for when you sign on the dotted line. Your monthly mortgage payment can increase hundreds of dollars a  month if you escrow your home insurance and your taxes, and you must know this ahead of time to ensure you buy a home you can afford. If you can afford to spend $1,800 per month for a home, you must make sure you buy a home that allows you to keep your mortgage payment, taxes, and insurance at or under this amount. It’s a complicated process.

What Is Home Insurance?

Aside from asking how much is home insurance, the other question people ask is what, specifically, is home insurance? It’s financial protection from the unknown, the unexpected, and unplanned for emergencies that might happen in your home.

  • Hurricanes
  • Tornadoes
  • Floods
  • Fires
  • Theft
  • Damage

Home insurance is designed to protect you, and it comes in many forms. What you pay for depends on where you live, what kind of zone your house is located in, and how much protection you feel you need for your home and family. It's an insurance policy that pays for the things you cannot afford to pay for if the unexpected occurs. You pay a yearly premium, and you're protected as long as you live in your home. 

Why Do You Need Home Insurance?

If a tree falls on your home during a storm and goes through your roof, can you afford to pay out of pocket to have the tree removed, the roof repaired, and the interior damage to your home repaired? It could cost tens of thousands of dollars to repair this. If your home floods in a storm, can you afford to have all the water removed, the drywall removed and replaced, and the flooring re-done? If your new home is in a flood zone, you are required to have flood insurance, which is actually a whole different policy than a standard home insurance policy.  If your home burns down in an accidental fire, can you afford to pay off the remainder of your mortgage and replace all of your belongings as well as buy or build a new home out of pocket? Most people do not have the funds to deal with this kind of devastation, which is why home insurance is necessary, no matter which disaster you are protecting your home from.

​Legal Protection

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One thing many homeowners fail to realize is that home insurance is not just about protecting you from damage to your home. It’s also meant to protect you from lawsuits filed against you. Let’s say someone comes to your home for a gathering, and they slip and fall down your stairs. They are injured, and they decide to sue you for damages. They could be awarded hundreds of thousands of dollars to cover the cost of their medical bills, injuries, and any other damages they seek.

How much is home insurance? It’s invaluable if you’re sued for hundreds of thousands of dollars because someone was injured on your property. You are not personally liable for that if you have home insurance, which means the person suing you isactually suing your insurance company. Keep that in mind when you think about potentially not paying for home insurance.

​Damage

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Damage can occur anytime and in any way. If you live in a flood zone, it takes one storm to flood your home. If you live in Florida, a hurricane can hit any time. If you live anywhere with any kind of weather, you could face damage from snow or ice, lightning or wind, or worse. Not all damage that your home might face is catastrophic, but your insurance company will cover the cost of replacing or repairing anything that’s damaged in a storm or in a burglary or theft. You will need to read your policy and ask questions because there are some instances, such as runoff water that are never covered.

It’s A Requirement

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How much is home insurance is a question you must consider when you buy a home using a loan.You are required to carry insurance or the bank will apply a policy to your mortgage, and it might not be the most affordable policy or the best one for you. The bank that lends you the money to pay for your home is the owner of your home until that loan is paid in full.

This means the lender needs to protect their own investment, and they require all homeowners to carry a home insurance policy. If for no other reason, you need home insurance because it’s a requirement with your mortgage.

How Much Is Home Insurance?

How much is home insurance is the question on your mind, but the answer is not as specific as the question. Generally speaking, the average cost of home insurance for homeowners can be anywhere between $400 to $4000 depending on the replacement value to put your home back to the condition it was in before the damage occurred.. This is not a direct quote, and it does vary based on many factors. Some rates are lower, some are higher, and some are in the middle.

Some people pay significantly more depending on the state in which they live and the zone in which they live. For example, someone who lives in a flood zone will pay more for home insurance because they are in a risky area prone to flooding. Other risk factors that might cause your home insurance premium to cost more than the average is the crime rate where you live, whether you live in a storm-prone area, and even the kind of home in which you live.

Manufactured homes are more likely to suffer damage than block homes in an area where storms are common, but they are less expensive to repair. A person who has expensive furniture, art, and jewels in their home might pay a lot more than someone who doesn’t have that kind of stuff in the house. Personal property coverage is a part of your home insurance policy, and that might cause your home insurance rates to rise significantly.

What Factors Are Used to Answer How Much Is Home Insurance for a Homeowner?

Your home insurance company will consider many things before they quote you on your insurance premium, and the things they consider include many of the following:

  • Your marital status
  • The age of your home
  • The materials used to build your home
  • Whether you have a home-based business
  • Where you live
  • The condition of the roof
  • The proximity of your home to a fire station
  • Your credit score
  • How much you want to pay for a deductible
  • Whether you have a dog and what breed it is
  • If you have a pool or a hot tub
  • If you’re located on or near a body of water
  • The cost of replacement

​These are a few of the things home insurance companies consider when issuing rates for homeowners.

Can I Lower The Cost of Home Insurance?

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You can control the cost of your home insurance marginally if you try a few things. Bundling all your insurance policies with the same company can lower your rates. For example, your home, life, and auto insurance policies can be bundled in order to save you some money. You can opt for a much higher deductible to equal a lower monthly premium. The higher your deductibles, the lower your premiums.

You can opt to live in a home without a pool or hot tub, one that is not near a body of water or located in a flood zone, and one that is not in a neighborhood where there is a high crime rate. You can get married, and you can buy or build a new home with all the updated safety features to save you a bit of money on your home insurance. You can also protect your credit score to ensure that you are not viewed as a risky homeowner.

​Pets and Insurance

If you have a dog, you can expect to pay more for your home insurance. If your dog attacks someone and they decide to sue you for damages, your insurance company needs to protect itself. They do this by charging homeowners with certain dog breeds more money for their insurance. Breeds that are more inclined to attack people are listed below, but this is not an all-inclusive list.  Each insurance company has its own list of breeds it will not write at all.

 

  • Rottweilers
  • Pit bulls
  • Chows 
  • German Shepherds
  • Mastiff

However, your dog and your insurance company might have their own relationship. Many insurance companies make their own decision about the cost of your insurance policy and the type of dog you have, and some will refuse to insure you at all if your dog falls into what they consider their own personal breed of “Dangerous Dog Breed”.

Other insurance companies will charge you more if you have an exotic pet such as a snake, ape, or even a game cat. Exotic pets are considered wild animals, and owning one could make your home insurance price skyrocket.

Conclusion

If you want an answer to the question, “How much is home insurance?” you need to get quotes from several companies. It’s the best way to ensure you know what you’re getting if you’re being charged fairly, and what you can expect to pay for what you need. No two people pay the same amount for the same policy, which means you want to be sure you’re shopping for only what you need to cover the cost of your home, valuables, and belongings.

Amazon Credit Card Review

August 2, 2019 by  
Filed under Credit card, Resources

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Image from Amazon

The Amazon Prime Rewards Visa Card provides you with 5% back on Amazon.com and Whole Foods Market purchases; It offers 2% back from purchases at restaurants, gas stations, and drug stores, and 1% cash back on all other purchases. You can redeem your rewards easily for millions of items on Amazon.com. Further, you have access to travel baggage delay insurance, lost luggage reimbursement, no foreign transaction fees, and other perks. Also, the Amazon credit card offers protections for roadside mishaps. It also offers room upgrades and exclusive benefits.

In this review, we will cover the details of the Amazon credit card, review its pros and cons, and then compare it to similar products on the market for a comprehensive overview. We hope that this article provides you with more information and aids in your new creditcard search.

What Is the Amazon Credit Card?

With the Amazon credit card, you can keep your Amazon card in your wallet to use in stores, and you can keep your card synced with your Amazon Prime membership online and use your card to pay for Amazon.com purchases. If you have an eligible Prime membership, you can earn 5% back at Amazon.com with the Amazon credit card. If you do not have a Prime membership, you can still earn 3% back with purchases at Amazon.com. Further, upon approval of an Amazon credit card, you receive an instant $70 Amazon.com gift card.

Product Specs

While you can gain the most rewards by purchasing items on Amazon.com, you can earn rewards anywhere you shop with the Amazon credit card. One of the greatest card perks is the travel benefits. When you use your Amazon credit card on international trips, you receive lost luggage reimbursement, baggage delay insurance, travel accident insurance, travel and emergency assistance, and no foreign transaction fees. Further, when traveling via car, you receive purchase protection, extended warranty protection, auto rental collision damage waiver, and roadside dispatch.

Also, if you stay in the Visa Signature Hotel Collection, you can receive room upgrades and VIP guest status. You receive complimentary Visa Signature Concierge service 24/7 to help you plan and book.

Pricing

There is no annual fee to use the Amazon credit card. As mentioned above, there are also no foreign transaction fees.

How It Compares

We picked a few similar products available on the market to see how they compare to the Amazon credit card:

Amazon Credit Card

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PRICE

There is no annual membership fee for the Amazon credit card. However, to gain the most rewards and 5% back on Amazon.com purchases, you have to be a Prime member, which requires a $119 membership fee per year.

APPLICATION PROCESS

When you submit an application for an Amazon credit card, your application is processed through Chase Bank. If your application is instantly approved by Chase, you will be taken to the Cardmember Agreement page with terms and agreements to review before using your new card. If your application is not instantly approved, you will be informed about your status after Chase has completed their review process, which takes an average of two to four weeks after applying.

INTRODUCTORY PERIOD

There is no introductory APR period, and it is consistently 15.24-23.24%. However, when you are approved for the Amazon credit card, you receive a $70 Amazon.com gift card to use online. 

BALANCE TRANSFER

The Amazon credit card has a balance transfer fee of 5%, with a $5 minimum. 

CUSTOMER SERVICE

Many customers have reported negative experiences with customer service for the Amazon credit card.

Pros

  • 5% cash back on Amazon.com and Whole Foods Market purchases under Prime membership
  • 2% cash back on gas, restaurants, and drug stores
  • Great travel perks, with lost luggage reimbursement, no foreign transaction fees, plus more

Cons

  • Cannot transfer reward points to other accounts
  • No introductory APR period
  • No annual bonuses

American Express Everyday Card

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With the American Express credit card, you receive 3% cash back at US supermarkets up to $6,000 per year on purchases, 2% cash back at US gas stations and some department stores, and 1% cash back on other purchases. Further, you receive a $150 statement credit after spending an initial $1,000 within the first three months. There is no annual fee, and there is a 15-month introductory APR period. You can redeem cash back or statement credits, gifts cards, and various merchandise.

PRICE

The American Express credit card has no annual fee, so it is an inexpensive credit card option.

APPLICATION PROCESS

In order to apply and be approved for an American Express credit card, you should have an average credit score at a minimum. The application process takes five to ten minutes to complete. After submitting your application, you will receive a message on your computer screen indicating that you have successfully submitted the application. Then, you will receive an acknowledgment email from American Express within one working day along with next steps.

INTRODUCTORY PERIOD

The American Express credit card has an introductory period of 15 months with 0% purchase APR. Also, there is a 15-month 0% introductory period on balance transfers. There is also a $150 statement credit after you spend $1,000 on purchases with your new card within the first three months of opening an account.

BALANCE TRANSFER

As mentioned in the introductory period section above, there is a 0% charge on balance transfers during the first 15 months. After the introductory period, the American Express credit card has a regular APR of 14.99% to 25.99%. 

CUSTOMER SERVICE

Many customers have reported poor customer service from American Express employees. Many people rate the assistance with this card as “bad.” 

Pros

  • 15 month 0% APR period for purchases and balance transfers
  • $150 statement credit after you spend $1,000 during the first three months
  • 3% cash back at US supermarkets and 2% cash back at gas stations and some department stores

Cons

  • $6,000 maximum for 3% cash back at US supermarkets (followed by 1% cash back)
  • Many customers reported a poor experience with customer service
  • American Express not widely accepted by all retailers

The Platinum Card by American Express

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The Platinum Card from American Express is an excellent travel card for those always on the go. You can earn five times the points on booked flights or with American Express Travel, five times the points on prepaid hotels (hotels booked and paid in advance) via amextravel.com, and you can earn points for each dollar spent on eligible purchases. Furthermore, you can earn 60,000 reward points when you use your new card on $5,000 in purchases after your first three months.

With the Platinum card, you can enjoy complimentary benefits, such as $15 in Uber credits for US rides every month plus a $20 bonus in December. Further, you can enjoy complimentary, unlimited Wi-Fi access with the Boingo American Express Preferred plan on up to four devices. Additionally, you receive hotel benefits of $550 at more than 1,000 fine hotels and resorts when you book through Fine Hotels & Resorts Program, including room upgrades upon arrival, daily breakfast for two, guaranteed 4 pm late check-out, noon check-in when available, complimentary Wi-Fi, and unique amenities valued at $100 USD, such as spa or food and beverage credit.

PRICE

This a more expensive card option with excellent perks for frequent travelers. There is an annual fee of $550 for card users. 

APPLICATION PROCESS

The American Express Platinum card is one of the best travel cards, with its 60,000-point welcome bonus, purchase rewards, and annual travel credits, so it has pretty strict requirements. You need to have a credit score above 700, and you need to make sure that you do not open too many new accounts at once, which can jeopardize your approval chances. If you are concerned about your credit score, you should consider getting another American Express credit card first, which allows you to establish a relationship with American Express before applying.

You should be 21 years of age or older to apply as your chances will be a lot higher. We have rated this process as two out of five stars for its more difficult and competitive process.

INTRODUCTORY PERIOD

This is a charge card, which means thatthe balance should be paid every month. There is no introductory APR period as there is no APR on this card. However, you can opt to pay over time as well. As an introductory bonus upon using your card, you can earn 60,000 reward points when you spend $5,000 during your first three months.

BALANCE TRANSFER

This card does not have an option for balance transfers as it is a charge card and not a credit card.

CUSTOMER SERVICE

With the American Express Platinum card, you can rely on 24/7 medical, legal, financial, and other select emergency coordination and assistance services when traveling more than 100 miles from home via Premium’s Global Assist hotline. They can direct you to English-speaking medical and legal professionals and arrange for transfer to a medical facility. Premium Global Assist can also help with prescription replacements, emergency hotel check-ins, cash wires, missing luggage, lost or stolen passports, and more.

Premium offers roadside assistance 24/7, including emergency towing up to 10 miles, changing a flat, or jumpstarting a battery (even in the driveway). They will pay for included services up to four times a year.

Pros

  • 24/7 medical, legal, financial, and other emergency coordination and assistance services
  • Enjoy complimentary access to 1100 airport lounges across 120 countries
  • 60,000 bonus points during the introductory period

Cons

  • Expensive annual fee
  • Charge card, not a credit card, which means that you should pay your entire balance every month
  • Not all airport lounges participate

Alaska USA

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The Alaska USA Visa card is offered by Federal Credit Union and offers reward points for every dollar spent, which can be redeemed for travel and merchandise. There is no annual fee for Alaska USA checking account holders. There is a low, fixed APR rate of 10.5% with no penalty rates, and there are no foreign transaction fees. Points are redeemable for virtually any airline, hotel, cruise, or name-brand merchandise. Extra travel benefits include rental car insurance, lost luggage insurance, travel emergency assistance, and travel accident insurance.

PRICE

There is no annual fee for this card if you are an Alaska USA checking account holder. However, if you do not have an Alaska USA account, there is a $50 annual membership fee.

APPLICATION PROCESS

You can become a member of Alaska USA Federal Credit Union if you are affiliated with a company, organization, or community that has requested that Alaska USA serve their members or employees. You can typically qualify if you are related to someone who is qualified to join, such as someone that lives or works in Alaska, Washington, California, or Arizona.

INTRODUCTORY PERIOD

There is an introductory 1.9% APR period on purchases made through January 31, 2019. After January 31, 2019, APR for purchases increases to 10.5%, 12.5%, or 14.5%. There are no bonus points during this introductory period. 

BALANCE TRANSFER

Balance transfers incur an APR of 1.5%, 12.5%, or 14.5%.

CUSTOMER SERVICE

Many customers have reported poor customer service, assistance, and flexibility. 

Pros

  • Low purchase interest rate
  • Flexible flight rewards
  • Enhanced travel rewards

Cons

  • $50 annual fee if you are not a checking account holder within Federal Credit Union
  • Must be a member of Alaska USA credit union to apply
  • No introductory bonus reward

Conclusion

The type of card that you choose depends on your priorities and your spending habits. If you frequently shop on Amazon and want to redeem your rewards for Amazon purchases, we recommend the Amazon credit card. We have rated it a total of four out of five stars for its 5% cash back on Amazon.com purchases and Whole Foods Market purchases, along with its $0 annual fee. However, you gain the most rewards by being a Prime member, which does incur an annual fee.

In comparison, we recommend the American Express card for its broad range of reward opportunities and ways to redeem, as well as its $150 introductory bonus. If you are a frequent traveler that wants a lot of perks, we recommend the American Express Platinum charge card. You should be cognizant of its high annual fee and that it is not a credit card. Finally, you can check out the Alaska USA card if you live within its membership range and want travel benefits. We hope that the card you choose gives you the most rewards for your spending habits. Happy shopping!