Mistakes people make when buying Home Insurance in New Jersey
New Jersey houses nearly 9 million individuals, and 64% of these people own a home, making the homeownership percentage in New Jersey slightly higher than the country’s national average rate of 63.9%. The annual cost of homeowners’ insurance in NJ is around $1,700, bringing it to the 14th spot of the least expensive state in the US for home insurance.
The average homeowner insurance costs are 24% less than the country’s national average price of $2,300 for over $300,000 in dwelling coverage, $1,000 deductible, and $300,000 liability. It is essential to have coverage for your home because the state is known to experience hurricanes, storms, and other natural disasters a couple of times throughout the whole year. Whether you are purchasing a starter house or want to protect your existing New Jersey home, you must have homeowners insurance.
New Jersey Homeowners Insurance Costs
We have established how much the average costs of homeowners insurance in New Jersey, which is around $1,700. However, these costs vary for premium insurance expenses. According to the III (Insurance Information Institute), the following factors influence the overall insurance rates of New Jersey homeowners:
- Your Choice of Homeowners Insurance Companies
The rates for homeowners insurance in New Jersey also varies on the homeowner insurance companies you use. The best homeowners insurance companies in the state offer prices between $522 up to $1,700.
- Your Specific ZIP Code or City in the State
The price of insurance for a house in NJ differ by city and city-specific variables, meaning your ZIP code has a significant impact on how much you pay annually. For example, Fort Lee in New Jersey boasts a homeowner’s insurance policy rate of only $831 annually. And Perth Amboy is slightly more expensive at $895 per year.
- Your Choice of Coverage Limit
The costs of your home insurance coverage depend on the level of coverage you choose. In New Jersey, maintaining the standard $100,000 dwelling coverage can cost you up to $400 annually. However, if you have a dwelling coverage of $400,000, you will have to pay a higher annual homeowner’s insurance rate of $1,240.
- High or Low Deductible Rates
Among the many decisions that you need to make when shopping for a home insurance policy is deciding how low or high you want to set your deductible. The deductible is the amount you need to pay out of pocket towards when making a claim. The higher your deductible is, the cheaper your insurance rates are. If you want to pay lower home insurance rates, you need to keep the value of your deductible higher.
However, ensure that your deductible amount should only be high enough for you to pay during a loss. For example, if you have a deductible level of $500, your annual home insurance rate amounts to $940. And if you have a deductible level of $5,000, you will have an annual home insurance rate of $664.
- Crime Rates in Your Area
As mentioned earlier, home insurance rates vary per city in New Jersey. Another factor that affects the price of your homeowner’s insurance depends on the level of crime rates in your location. Cities like New Jersey City, Newark, and Asbury Park boasts some of the highest crime rates because of their larger population.
- The Susceptibility of your Home to Insured Disasters
Cities that are near coastlines or bodies of water tend to have more expensive home insurance prices. That is because these homes are prone to hurricane damage and flooding than those houses located inland.
Because the costs vary, you need to shop for the best home insurance rate for the right policies. It’s best to get at least three price quotes when shopping for coverage options, getting the right coverages can save you up to hundreds of dollars per year.
New Jersey Homeowners Insurance Coverage
Although the New Jersey law does not require residents to have homeowners insurance, getting insurance on a house is essential when residing in the state because it sees more than the average number of hurricanes annually. With having its fair share of natural disasters like the devastating Hurricane Sandy in 2012, costing New Jersey over $49 billion in damages.
If you want to protect your property, the best way is to purchase a New Jersey homeowner’s insurance from reputable insurance carriers and choose the best coverage options. These insurance policies come with an array of home insurance coverages, the standard ones include:
Personal Liability Coverage
Getting homeowners insurance in New Jersey protects you when someone gets injured at your home, and you’re held liable. For instance, when someone falls down the stairs, this coverage can provide expenses that can cover their medical costs. It can also assist with legal charges against a liability claim.
This part of a standard homeowner’s insurance in New Jersey covers the expenses of rebuilding a home when it gets damaged or destroyed by hurricanes, fires, hail, lightning, or other natural disasters listed in the policy.
However, it will not pay for damages caused by floods, earthquakes, or routine wear and tear. You can consult with your local insurance company to see which insurance policies can cover the expenses of the ones not included in the homeowners’ insurance policy.
Coverage for Personal Belongings
Furniture, electronics, clothing, sports equipment, and other personal items are covered if they get stolen or destroyed by insured disasters like a fire or hurricane. This coverage also includes expensive belongings like jewelry, but most homeowners insurance companies provide a limit when they get stolen.
Additional Living Expenses
This coverage is also known as loss of use. It covers the additional costs of staying away from home if your house becomes inhabitable because of damages from insured disasters like fires or storms. It covers hotel expenses, restaurant bills, and other necessary living costs while your home undergoes reconstruction. The coverage for additional living costs varies from company to company.
Those mentioned above are the standard coverages included in the standard New Jersey homeowners’ insurance policies. You can add extra coverage options including:
If you experience a frequent breakdown of your electronics at home due to insured disasters, you can add this exclusive coverage to your policy. It covers the expenses of certain electronic appliances, including air conditioning and heating units. However, it does not include the regular wearing and tearing of these items.
Other Structures Insurance
It helps protect the structures on your property detached from your home. These structures include gazebos, swimming pools, tool sheds, and detached garages. It covers the expenses when these detached structures get damaged by fire, falling objects, vandalism, and other causes.
Besides the coverage options mentioned above, you can also add flood insurance, medical payments, and full replacement cost coverages. Consult with an agent with the insurance company of your choice and see which coverage options are the best to add to your insurance policy.
Things to Consider When Shopping For Homeowners Insurance in New Jersey
Now that you know the different factors that affect the rates of home insurance, and the different coverage options you can include your insurance policy, you are now ready to scout for the best homeowner insurance policies.
The following are a few important considerations to take when shopping for the best policies in New Jersey.
- If you live along an area near the coastline or a body of water, you need to assess if you need separate flood insurance to protect your home. That’s because if you opt for the standard New Jersey homeowners insurance, this does not cover damage from a flood.
- Decide the right amount of deductibles that fits your budget and not compromise the safety of your house.
- If you live in an area where your home is prone to severe storms and hurricanes, see if you need to increase your coverages for hail and wind damage.
- Buy the appropriate coverages that meet your home’s specific needs rather than just copying your home’s market value.
Consider these factors before choosing a policy for your home. You can consult with agents from reputable insurance companies in New Jersey to simplify and quicken the process.
Most Common Homeowners Insurance Losses in New Jersey
Because New Jersey is close to the Atlantic coast, the state is prone to experience several seasonal storms that start in the Atlantic Ocean, including nor’easters and the classic hurricane. These natural disasters subject your New Jersey home to the wind, rain, snow, and massive flooding. Some insurance companies cover damages from these calamities, while some do not.
Does Homeowners Insurance Cover Wind Damage?
Yes, most homeowners’ insurance in New Jersey covers the expenses of damage to your house from harsh winds. It is one of the basic perils covered in most homeowners’ policies in the state.
Does Homeowners Insurance Cover Rain and Flood Damage?
Unfortunately, no. The standard homeowners’ policies in New Jersey does not cover damages from these natural disasters. Instead, homeowners need to purchase separate flood insurance, which includes the damage to your home from all kinds of floods, from hurricane-related to river overflows.
Does Homeowners Insurance Cover Snow Damage?
Yes, the standard homeowner’s insurance covers the damages caused by the weight of snow after wet snowstorms or heaving snowing. Heavy snow can damage your roof or other properties, and may even cause a collapse in the structures.
Getting homeowners insurance is ideal for protecting your homes, covering the much-needed expenses of the average New Jersey home. If your home is prone to extensive damages, save big and call your local home insurance companies to get the best deals.
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