Tuesday, 21 May 2013

How Much Auto Insurance Do I Need

                                    An auto insurance policy can have different kinds of coverages.Your own insurance agent can provide you information on the type and amount of car insurance coverage which meet your
individual requirements and agree with the laws of your state. Here are the important types of coverage that your policy may includes.

Liability Coverage :-  
                         These policies help in covering liability and the expenses when you are at a fault in an accident. This money will be used in the treatment of those people you hit, but it is not going to cover treatment expenses of the people got hurt in your car. 
Bodily Injury Liability :-    
                           The minimum coverage for bodily injury varies from state to state. This policy covers the medical expenses of those people who got injured in an accident in which you are at fault. While you are looking for policies, you may often seen policies described as a 20/50 policy. In these figures, the minimum dollars amount stands for the amount payed for a single person's injuries and the maximum number for all the injuries sustained by all the passengers of the other car. 

Property Damage Liability :- 
                           This policy pays the amount for damage done to the other car if you are at fault in an accident. The minimum amount policy that you must carry varies from state to state. But the minimum is not near to be enough to save you in a serious accident. Now a days many of cars cost more then $50,000 so you could be easily be responsible for a considerably high repair bill if you hit someone's expensive car. But if you have a Personal Umbrella policy, then you will be covered for the excess expense, but for that you may carry more than the minimum to qualify for a Personal Umbrella Policy.    

Medical Expenses :- 
                          This claim covers the cost of medical treatment for you and your car passengers in the event of an accidents. The limit you choose under Medical Expenses Coverage is the maximum that will be paid for medical claims to each driver. So, if you go for a $3,000 Medical Expense Limit, then each passenger will have a coverage up to $3,000 for medical claims which result from an accident in your vehicle. 

Personal Injury Protection :- 
                          This protection coverage is required by the law in some states, which covers your medical costs and those of your passengers, no matter of who was at fault for the accident. The limits required are set by the state law. 

Collision Coverage :-  
                          This policy covers the cost of repair to your car after an accident. In this, you don't have to decide how much to buy,  because that depends on the vehicle you insure. But you have to decide whether to buy it and how large a deductible to take. Because the higher the deductible the lower your premium will become. This coverage is important to have, if a car is new and valuable, but less important as the value of the vehicle declines.  

Comprehensive Coverage :-  
                           This policy covers the cost of varied damages to your car which is not caused by a collision such as theft and fire. With collision coverage, you need to choose a deductible. Because the higher deductible you choose the lower your premium will be. Comprehensive coverage is normally sold with Collision coverage and both of them together often referred as Physical Damage Coverage.   


How To Insure Your Car

                          Getting a suitable insurance cover for your vehicle is a straightforward process. Insuring a car should not take you more than a month before you sign a deal. The process of how to insure your car
does not change much if your car is a luxury or normal one. The only difference that will come is that a luxury car is more expensive than a normal car, so its for granted, you will pay more in insurance premiums for insuring a luxury car compared to a normal car.

 Here are few tips on how to insure your car -

                                     There are only a handful of nationally-recognized car insurance companies. The best place to start, is by getting an idea of what kind of policy you need and the kinds of companies you are willing to get it from.
  •  Separate It Out -  Car insurance is made up of six types of coverage and each priced out separately to come up with your bill. But some of the coverage may not be necessary. The Insurance Information Institute separate it out what you need to know about each type of coverage. 
  •  List Of Licensed Companies -  Before going further, keep in mind that not every insurance company is licensed to operate in each state. So find out which ones are licensed,that way the state insurance department will help if there are any problems. 
  •  Weigh It Out -  Car insurance price can depend on so many factors, such as from your car's engine size to your credit history so one should get price quotations from at least three insurance companies. And make sure you are comparing every point. The Insurance Information Institute has an online tool to help you find auto insurance companies in your state. 

                              When you are narrowing down the agencies list, then price should be a factor in selecting a company but not should be decisive. Think of buying your car insurance from the same company you bought your homeowner's or renter's insurance. Because many company offers discount if you buy them from the same company.
  • Company Financial Status - If you think by comparing different insurances and selecting the best of them at lowest price is all then you are wrong. Who cares if a policy is cheap but the company won't be around to pay for claims. So check out the insurance company's financial status before investing in it.
  • How's Their Service - There are different levels of claim services. But you will want to find out about the one that will handle your claims fairly and quickly. You can find out this information from talking with current and former customers. 

                                   Now when you have settled with the terms of your car insurance policy, there are still few things by which you can reduce the cost further more.
  • By Increasing Deductible - If you increase your deductible, it could reduce the premium and save you 15 to 30 % or may be more. Just be sure that you can afford your deductible if you are in an accident.
  • By Reducing Coverage On Old Cars - It may not be a good idea to spend your money to pay for collision and comprehensive coverage on cars worth less than 10 times the amount you pay for its coverage. 

Saturday, 18 May 2013

Why Auto Insurance Is Important

                        Most basically, auto insurance is smart planning it protects you, your vehicle and other people from any road accident you or your family might involved in. It provides compensation to cover any types of
damage to property, injuries to other driver, passengers or pedestrians. Think of auto insurance as a part of your financial plan because its a powerful tool that can help you.

1) For Start It's A Law :-
                        Yes it's a law. And in few states if you even want to register a vehicle you need to have auto insurance. To reduce the overall property damage costs and also to save the huge accident related medical bills going unpaid states requires vehicle insurance. So if you have insurance, your insurance company will absorb all these damages or injury costs because you pay your premiums. 
                If you think that just because the law requires it, its not necessary to do. Then think how much it will cost you or will make you suffer for breaking the law. Drive without an insurance papers and you get a ticket, that ticket it self will cost couple hundred dollars. And if you get another ticket, then you can loose your license and even get your vehicle impounded. This whole thing will cost you a lot of money and trouble. 

2) Liability Coverage :- 
                        Every driver of a motorized vehicle is required have a minimum purchase which is liability coverage. The charges of liability coverage differs from one state to other state and its important to have the minimum amount as required by law. If a driver drives around without basic liability coverage, he could be given a ticket, have their license suspended or even may be arrested. A state requires some levels of minimum liability insurance because it's this coverage that pays for the damage you do to others, including property damage and bodily injuries. It also pays for your legal bills if you cause an accident but only up to your liability limits.
3) Collision and Comprehensive Coverage :-
                           Collision coverage pays to repair your own vehicle in the event of an accident. Your car is considered "totaled" when the car repair cost exceed a certain limit of the car's value. At that point the insurance company take away the car and offer you the actual cash value of your car. When you buy collision coverage to keep premium costs down , you can raise your deductible. The higher your deductible is, the lower your premium. But you have to pay that amount from yourself.
            Comprehensive coverage pays for damage to your car that is not due to any car accidents also. It includes fire, vandalism, theft, collisions with animals and natural disasters.

4) It's An Investment :-
                            Vehicle are probably the second most expensive thing you buy after your homes so to keep your investment safe you need to insure it, as they are in much more danger of getting damaged since they are always moving about. If your vehicle is new or a expensive one, you should probably continue to carry liability and collision coverage on your vehicle. The cost of collision coverage is a little more than liability, and it will guarantee that you can repair your vehicle no matter what happens to it in an accident.

7 Thing's Home Insurers Won't Say

                       There are few things that your home insurance company don't want you to know. Here are
few of them -

1) Things Which Are Out Of Ordinary :-
                          If your home is near by earthquake, flooding prone area  everyone knows that insurance company will persistently ignore you. Where as some of the insurers use illegal underwriting guidelines -  the industry term for discriminate against certain groups or locations.

2)  One Step Against Us And You Are Gone :-
                          Now a days insurance companies are even more selective about whom they will insure and whom they won't. If you file a single claim and get tossed out, and once you have been dropped, there wont be many insurance company that want to touch you.  

3) How Much You Are Entitled To :-
                         If your policy includes replacement cost, then you are entitled to complete replacement of damaged property. But insurance companies may try to find a a middle solution and will try to fix it back in the condition it was before the loss instead of replacing it.

4) We Are Secretive :-
                         Try it out when ever you are going to ask your insures about how many claims it would take for the company to drop you or take you as a risk. And chances are you won't get much of answer. 

5) Are You Over Insured :-
                         When it comes to home insurance you don't want to be under insured. But could you be actually be over-insured?  It happens many times, and when it does happen its mostly the mortgage lender's fault.

6) We Play Favoritism :-
                          Any authorized agent is a good agent that's what insurance companies will tell you. But in reality they play favorites, by giving preferential treatment to those who brings the most business. 

7) We Preffer New Homes :-
                         If you wanted to buy a beautiful home build in the 1960s, with original state roofs and fluted ceilings that look like they are right out of Architectural Digest. It sound lovely, but when you will try getting insurance they are going to avoid you because of mature homes, even when they are only 30 or 40 years old.

10 Things Can Lower Or Raise Home Insurance Rates

                    While buying a home for yourself, there are few things that you should keep in mind which can affect your insurance rates. There are many things that can lower or raise your home insurance rates by
hundreds, even thousands of dollars per payment. Here are few ways to minimize the cost of your homeowner's insurance.

1) Location Of Your Home :-
                     Surroundings of your home affects insurance premium. If you live in an area which is prone to natural disasters such as flood, hurricanes and earthquake then you will have to pay more for homeowners insurance. And type of insurance becomes so expensive that many big insurers refuse to provide homeowners with coverage in certain high risk areas. If the home is susceptible to earthquakes or floods, you will need a separate policy no matter where you live.
2)   How Much Is Enough :-
                     Many homeowners home are under insured because they have not bought enough insurance to cover the replacement value of their home. And many are over insured because they calculated wrong or might be because they calculated by including the value of the land. Make sure you are properly insured for the rates you pay.

3) Construction Material :-
                    The quality of material used to construct a home will effects your premium. Example, homes built with bricks are less expensive to insure than wood frame homes are. Also if the roof or the plumbing has not been updated in 25 years, that means you are at a high risk of getting an expensive insurance group. Where as if your roof is newly constructed of impact resistant material then you could qualify for a discount. 

4) How's The Electrical System :-
                     The electrical system does not need to be replaced, unlike the plumbing and the roof to be replaced to qualify for a good insurance rating. But is have to been updated with in past 25 years to meet current codes.
5) Surrounding Of Your Home :-
                       Your neighborhood also plays an important role in your homeowners insurance policy. Example, if your home is near to a police station or to a fire department may lower your yearly premium. Living in a high crime zone will probably increase the rates.

6) How's Your Home Security :-
                        If you have a smoke detector, burglar alarm or dead-bolt locks at your home you can get a discount from your premium.Some of the insurance companies offer a good cut if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire or other required stations. But these systems are not cheap and not every system qualifies for discount. Before installing these systems at your place its better you find out what kind your insurer recommends, how much it is going to cost and how much you'd save on premiums.

7) How New Your Home Is  -
                        A new home has new utilities and you can get a very good discount also.

8) Combine your Home And Auto Insurance Policies :-
                       Consider buying both insurance policies from a company that offers both. Because some of the companies offer discounts if you buy both types of coverage from them. Make sure the price is lower by buying two polices from the same companies then buying them from different companies.   

9) Don't Make Minor Claims :-
                        Don't make repeated claims for minor problems because it will raise your premium. Repairing small problems in a timely manner will help you avoid big losses in future.

10) Keep Your Insurance Up To Date :-
                         Once in a year, before your home insurance policy is due to renew, find out the current policy read all the details and call your insurance agent to discuss any changes in your situation that occurred during the year.  

Thursday, 16 May 2013

How To Choose An Home Insurance Company

                            Selecting the right home insurance company is a tedious job but it's an important decision also. And specially when you have to select one out of so many companies with different policies. For new
home owners and those who don't have that much of industry knowledge finding the right company must be more difficult than for others.  However, there are few things you can keep in mind while choosing an insurance company.

1) Selecting Insurance Company :-
                           Insurance fee is an important thing, but it's not the only or most important factor while selecting a company. When we are thinking about home insurance, you may want to make sure that those companies are legal and creditworthy. Before you make up your mind, it's better to find out if the company is licensed or not.

2) Insurance Company Financial Status :-
                          Before investing in any company find out it's financial status by searching on web about the top credit agencies. But you should not stop here, consider asking relatives, co-workers and friends for referrals. Its always better to get benefit from the experiences of others, so get knowledge from someone you know who had filled a claim about an insurer's customer service representatives, the speed with which a claim was appraised, processed and paid is up to the customers expectations or not will tell you about the efficiency of that company.

 3)  Choose Company On Reputation :- 
                          The reputation and trust of a company is a very important thing while choosing your insurance company. Find out about the company's past operations so that you can be sure using this firm to insure your home.    

4) Decide Your Coverage Needs :-
                           According to your needs find home insurance that satisfy your level of requirements. 

5)  According To Your Geography Choose Insurance Company :-
                           Different locations have different geographical issues like natural disasters. So companies that don't have a wide base of operations in your surrounding may not correctly understand your requirements. Ask home insurance companies about coverage for various perils.  

6) Other Important Factors :-
                           There are few important factors to be taken into consideration are -
  • Policy holders complaints
  • Fraud reports
  • Rating of the insurance company
 These few things are really not difficult to acquire, but are important. Some of the home insurance companies have these information on their websites. 

7) Final Point :-
                    Try to assess the customer service operations of insurance companies before making the decision. From this you will learn how the company treats new customers as well as long term policy holders. 

Wednesday, 15 May 2013

Do's and Don'ts When Insuring Home

                     You know you need a homeowners insurance and you also know you shop around when you want to get the best thing. But when it comes to home insurance, you may  think to go for a safe side like a
company with which you do a regular business, or the company whose advertisement you see regularly on a television or someone your real estate gent recommended. As a result you may end with under insured or over insured.

Do's :-
     1)  Many homeowners find themselves under insured when they loose everything, even though they properly followed their agent and the rules. The promise of security that insurers advertise and sell is part of the contract you paid for. So it's up to you to enforce your rights under that contract.       
      2) Internet is a great thing and now a days easily accessible so begin your research with it. Don't just go with the one that looks good and make a deal. First call them, talk to a person and get as much as information you can get about them like they get on you. Remember one thing as much as you want them they want you.  
      3) Contact a reputable insurance company, agent office that is qualified and authorized to advice you about how to insure your home. Usually the advice you will get from an agent that only represents only one insurance company will be different from the advice you will get from an agent or broker who is independent and represents several competing companies.  
      4) Be clear to the agent or broker that you want to make your home properly insured and that you want to go for full replacement coverage. Mostly many agents fear that if they give you the true cost of fully insuring your home then you will run away some where to find a cheaper policy. So be clear that you will pay a fair premium for full replacement coverage.

      5) Answer all questions truthfully so the insurance company knows the exact size of your home, other constructions if available, style of construction, major improvements and your high value personal property items.  

      6) For good or extra security, buy the highest amount replacement endorsement you can afford. If you suffer a major loss and then turns out your insurer set your limits too low, this endorsement is designed to bridge the gap. Replacement cost endorsements are sold as percentage amounts above your stated dwelling limits. Most insurers offer 25-100% above limits. So see around for this protection.

      7) Few insurance companies offers different kind of discounts based on different things. If you're getting information from an agent about insurance but he don't talk about any discounts, then bring them up yourself. This is one more reason that you call around because every company offers something different.

      8) Make sure you tell your insurance agent about any improvement you have done to your home which may have cost $5,000 or more.

      9) To avoid extra controversy after a big loss make a video tape or photograph your home and contents. Keep them in a safe place and make copies of them and keep some off premises. 

Don'ts :-

     1) Don't rely on estimated sale price of your home to set your dwelling limits.

     2) Don't be a miser while buying insurance policy as its your biggest asset.

     3) Don't give false information regarding the size of your home to save some penny by getting a lower premium quote. 

     4) You should not use insurance to cover every small expense, just the big ones.

How To Insure Your Home Against Natural Disaster

                              Here my first comment will be, "don't let God become your worst enemy - make sure your home is properly insured". Are you aware with the phrase " includes all risk" insurance coverage?  And
I am sure most likely your answer will be a "yes". But have you been sure you understood it correctly? You might think what most of the people think, that this covers just about all hazards, since the name includes all risk. It's definitely the broadest type of property policy that may be acquired, but that doesn't mean it compensate just about all losses. Only losses that are not particularly excluded tend to be automatically  protected.
             So, what I want to say is that, pay special attention on the listing of exclusions. Or else, one day you might have the uncomfortable surprise to find out that, after your home has already been damaged, the insurance provider will not pay, because the disaster which had strike you was about the exclusions checklist.   
Is Your Property Covered Against Natural Disasters :-

                                        As we all know different part of country are prone to different types of natural disasters. So depending on where your home is, you may be prone to flooding, tornadoes, hurricanes or wildfires.  No matter what natural disasters affect your state, it's important that your home is covered against damage from these disasters.
                    Property not only includes your home, but also other freestanding structures as well as personal property. The Actuarial Foundation provides four different property categories. Which are explained below -

  1) Dwelling -
                The type of structure you live in, whether it is a home, mobile home, rental or condominium. Coverage varies for each different type of dwelling.
  2) Other structures - 
                 If you own a home, there may also be other structures like detached garage or tool-sheds which are  not connected to the home that for sure needed to be taken into consideration.  

  3) Personal Property -   
                  It includes appliances, furniture and clothing. But jewelry, money and guns may not be included as a personal property, so you may want to make sure they are kept some place safe. Always keep important papers such as wills and insurance papers in a safe deposit box.                                                                                                                                         
 4) Loss Of Home -
                 If you are unable to live in your dwelling because of a natural disaster that is covered in your policy, the cost of additional living expenses, such as staying in a hotel or renting an apartment while repairs are being made should be covered in the policy.

Tuesday, 14 May 2013

How Much Coverage You Need For Home Insurance ?

                   Your home insurance should be a straightforward matter of getting sufficient coverage to rebuild your house and replace the contents in the event of a total loss. And you also want to protect
yourself from such incident if someone gets hurt on your property and sues you for a complete treatment expense. But still how much is enough ? And that's not an easy question .
                           It was used to be said that you only needed to buy enough insurance to cover 80% of the cost of rebuilding your home, since it was unlikely that a house would be completely destroyed. But few disasters of 90s, disproved this wisdom. So, your best bet is to buy insurance to cover 100% of rebuilding.
            Just sit down on your couch and think about it and I am sure you can come up with a rough estimate for how much coverage you will require. Even you can ask your builder or agent for local construction cost per square foot for the kind of home you have. And if you have central air, Jacuzzi or any other expensive fittings then add on how much it would cost to replace them.
                       And once you reached at a approximate figure, there is another decision waiting for you. Which is, how do you want to be compensated in the event of any kind of loss to your home? In this you have two choices -
1) Cash value - It is the cheaper insurance policy. It pays the amount for what the destroyed property was worth at the time of destruction, and depreciation is included in it.
2) Replacement cost - It is the expensive insurance policy. It covers what it would take to rebuild your home and with similar quality material. But this policy has a price cap of 20% above face value.
            There is an important thing you should keep in mind that is, you will need to keep your insurance company informed of any additions or improvements you make to your home over the time so you won't be stuck with insufficient coverage.

If Needed Buy Extra Coverage :- 
                            It may be possible that you may need an additional coverage to protect against expensive artwork, jewelry and antique or against lawsuits.

   1) Be Sure Your Belongings Are Covered - 
                                            If you are a collector of more valuables, then you should increase the personal property protection to make sure it is enough to cover your jewelry and other expensive belongings. Assessment can help determine the value of your possessions so that you can know how much insurance to buy and so you can have proof of what the items cost.  

2) Expand Your Liability Coverage - 
                             Most standard insurance plans cover either $100,000 or $ 300,000 of liability coverage, which also pays for lawsuits against you, out of your home. You can enhance that liability coverage to $ 1 million through an umbrella liability policy, which costs about $ 150 more a year.

3) Get Government help - 
                         If you live in an area that is prone to flooding, look into purchasing flood insurance through the federal government's National Flood Insurance Program, which is managed by the FEMA. 

           Also, it sounds obvious, but make sure that you read all the small print before you sign any contracts. After disaster strikes, you don't want to be surprised to find out that your this and that was not covered.

How To Insure Your Home

                              Homeowners insurance protects your home, its contents in the event of theft, accidents, fires or other disasters. As I already mentioned about a standard homeowners policy that is
known as HO-3 policy, which will protect you from things like fires, theft and accidents. But have you noticed I didn't mention earthquakes, floods or war - because those events are specifically not covered by a standard policy and require additional coverage.

             If someone is on your property and hurts him/her self by falling down , so he/she might sue you for his medical treatment. If your home is properly insured in these kind of situations, the insurance company covers your liabilities. However, homeowners insurance is not required by law, like its necessary in auto insurance. But mortgage companies usually require you to have a home insurance policy before they will pass your loan.    
                        But a standard policy is not like a blank check, there is a limit to what amount you will be compensated. Remember one thing, when it comes to protecting your possessions you may want more coverage than your standard policy allows. So if you have anything of exceptional high value item like art, jewelry or family heirloom etc, then you should insure it separately. I know insurance company will charge some extra for this coverage but it pays to be covered.

                                     It is the most important thing to understand about the type of company you are going to work with, and the variety of plans available in market. 

1) Find Out Types Of Insurance Companies Present -
                                There are different kinds of homeowners insurance sales people and companies out of which few are explained below :

      a) Direct Sellers - this category includes those, who sell directly to consumers, typically online or over phone for example USAA or Progressive. 
      b) Captive Agents - this category includes those, who only sell one company's insurance products for example State Farm.
      c) Independent insurance agents - this category includes those, who sell policies from many different companies. Using an independent agent can help you get many quotes from several companies at once, but it's important checking out quotations from all three types of insurance companies because commissions, terms and packages will differ.

                    It may happen that all of these groups will dismiss your insurance application for any reason like the tornado or from the risky pool of alligators that runs through your property every year. Don't just give up hope, many states have state-sponsored insurance programs for the hard-to-insure. Then what you need to do is search for your state's Fair Access to Insurance Requirements plan if you are having difficult time with the normal insurers. 

2) Compare Quotations - If you got several insurance policies with the same company see what your plan would cost and how much you are getting off. Also, keep this thing in your mind that premiums will mainly includes a commission of 10 to 15% if you are dealing with an insurance agent, so make sure the plan pays enough value for your money.

3) Which Plan To Choose? - Always go for a replacement cost plan, instead of actual cash value. A replacement cost plan covers the amount, it would take you to rebuild or repair your house with similar materials, and not taking into count how much your home may have depreciated by time or wear and tear. This is separate from the market value of your home.

                                        There are many common incidents that can cause real damage to your home, but are usually excluded from your insurance policy.

      1) know the basics :- 
                                Usually standard plans cover the costs of rebuilding or repairing the home and other structures, like shed or garage. These plans also covers medical expenses and protect against lawsuits or claims resulting from accidents on your property or caused by pets or residents.

       2) know the exceptions :-
                                Most of the standard insurance policies do not cover flooding, intentional damage, damage from insects and animals to the property. And in some states, you may also have to pay more to cover your property from earthquakes or windstorms.

      3) beware of "guarantees" :- 
                                Some insurance companies will offer select customers, guaranteed replacement cost plans, that means they will cover the costs of rebuilding your home even if it exceeds your policy amount. However, those types of plans cost more than standard plans and are sometime capped at 125% of the insurance amount, meaning they will only pay 25% beyond the amount of your current insurance policy. 

Monday, 13 May 2013

Purpose Of Having Homeowner's Insurance

                       Insurance is the equivalent transfer of the risk of a loss, from one identity to another in exchange for payment. Home insurance is also called as homeowner's insurance or hazard insurance.
Your home is likely to be one of the largest single purchase you will ever make. Because your home is an expensive and an important purchase, it needs to be protected from different types of trouble. But owning your own home is not everything, homeowners must know how to insure it. Most of the new homeowners don't know what the insurance covers or the limitations on their policies mean, and find themselves without the coverage they thought they had, when they need it the most.  Knowing the purpose of homeowners insurance, what it does or what doesn't cover, can help you make few decisions about how you can protect your property and cut useless expenses. 


                    There are two very important things a home owner needs to know before going for homeowner's insurance those are :

  • The difference between replacement cost insurance from the actual cash value insurance. The replacement cost insurance pays the same amount of restoring the home to its pre condition or to build you a new home and contents of equal value and there is no reduction in the value of assets according to there use or wear and tears of the home. 
  • The less likable insurance is actual cash value that will pay you an amount equal to the replacement value of the damaged property minus the value of assets according to there use or wear and tear. In essence, you won't get your whole home back in this insurance. 


                                There are few different kinds of insurance referred to as homeowner's insurance but for most people, there are three main concerns:

  • Protect your home.
  • Protect your personal property.
  • Provide liability coverage.
Most homeowner's purchase a policy referred to as HO-3, which is a unique type of home insurance that includes open perils protection. Open perils protection covers all direct physical losses to your house and lists specific exclusions. All insurances exclude certain types of damage, including damage caused by law (problems caused by lack of proper papers), war, nuclear accidents, earthquakes, floods, power failure, neglect and intentional loss. Although HO-3 excludes these perils as a general rule, coverage for some of these specific perils may be added separately to the policy. HO-3 coverage is generally recommended as a minimum level of homeowners insurance.