A thunderstorm brewed thick and heavy outside of the Cleveland Bradley County Public Library while 40 area residents listened intently to the homeowner’s insurance legal forum inside.
Speaker Jack Tapper, a Cleveland attorney and current Bradley County Bar Association president, joked that the weather was perfect for the topic.
He reminded the crowd of the forum’s purpose.
“This is coming to you as a public service, an educational program,” Tapper said. “It is not intended to provide you with legal advice. That can only happen with attorney-client interaction.”
The Bradley County Bar Association plays host to several legal forums throughout the year. Tapper has hosted, moderated and spoken at the free events since 2010. Bradley County Commissioner and insurance salesman Jeff Morelock presented alongside Tapper Thursday night.
Tapper assured everyone started on the same page with a list of homeowner’s terminology:
- Premium: payments made for an insurance policy;
- Deductible: amount paid by the homeowner to replace or repair the insured item before insurance kicks in and contributes;
- Actual Cash Value: the worth of an item minus depreciation;
- Replacement Cost: how much it costs to replace whatever has been lost up to the premium limits;
Morelock interrupted to provide an example of actual cash value. He said a roof with a life expectancy of 20 years, repair costs of $10,000 and an actual age of 10 years would only receive $5,000 under actual cash value. The roof served half of its expected years, so it receives half of the needed repair costs.
n Declarations: summary of the policy and its basic information; and
n Exclusions: items and areas not covered by the insurance policy.
Homeowner’s insurance generally covers fire, hail, lightning, explosions, theft and falling objects. These items fall under the umbrella of coverage for house structures, property and personal liability. Items not usually covered include earthquakes and floods caused by outside forces.
Tapper advised individuals with expensive hobbies to purchase extra coverage for equipment.
Types of insurance vary based on the amount of coverage provided.
A member of the audience asked whether insurance commonly covers damage caused by mold. Morelock suggested homeowners contact their insurance agent about mold coverage.
“Sometimes it is covered, sometimes it is not,” Morelock said. “As a rule of thumb, it is not normally covered on a generic home insurance” policy.
Insurance companies determine the premium on a package based on several factors. A person’s insurance score, payment history, length of credit history and amount of outstanding debt in relation to credit limits are considered. Whether an individual has filed for bankruptcy also affects the premium.
Tapper urged the audience to use Annual Credit Report’s website to receive a free credit check up to three times a year. A good credit might aid in a better premium.
Additional financial aid comes through insurance discounts which are often given to new homebuyers and clients with multiple policies from the same company. Discounts may also be given to homeowners who have not experienced a loss in a while and who have placed protective devices, like smoke detectors, around the home.
In the event of a home replacement, Tapper reminded the audience the price might be higher than they realize.
Items to consider include: the total square footage; the style of the home; the material of the exterior walls; the number of kitchens and bathrooms; special features, like a built-in patio; and whether or not the home’s building codes are up to date.
As a final word of advice, Tapper urged homeowners to take a video home inventory. He said the process is intended to be slow and might take a couple of storage tapes. The idea is to visually and verbally catalogue every item of worth in the home.
He also advised digital pictures be taken of the same items. Memory chips and tapes should not be stored in the home. Tapper suggested using a bank safety deposit box.