Purchasing a home is a significant milestone for anyone, and even more so for Military families. However, with homeownership comes the responsibility of protecting your investment with the right home insurance coverage. Home insurance can be complex, and Military members often encounter terminology and considerations that differ from civilian homeowners. Read on as we discuss key home insurance terms to help you make informed decisions when selecting your coverage.
Home Insurance Basics
Before delving into military-specific terminology, it’s essential to understand the fundamentals of home insurance:
- Premium: The amount you pay for your insurance policy, typically on a monthly or annual basis (ask if there are discounts for paying annually).
- Deductible: The amount you are required to pay out-of-pocket before your insurance coverage kicks in.
- Policy: The formal contract between you and the insurance company outlining coverage, terms, and conditions.
- Coverage: The protection and benefits provided by your insurance policy HOI (Homeowners Insurance)
Homeowners Insurance, often referred to as HOI, is a comprehensive policy that covers your home and its contents against various perils. For military members, it’s important to understand:
- Dwelling Coverage: This protects the structure of your home, including the walls, roof, floors, and attached structures like garages.
- Personal Property Coverage: Covers your belongings, even if they’re not in your home. Military members may need additional coverage for items stored during deployments, PCS, or etc.
- Liability Coverage: Protects you in the event that someone is injured on your property, and you’re found liable. It can also cover legal expenses.
SCRA (Servicemembers Civil Relief Act)
The Servicemembers Civil Relief Act provides unique protections for military members, including:
- Rate Reduction: SCRA can cap interest rates on loans and credit cards at 6% while on active duty, potentially affecting your homeowner’s insurance premiums. ● Deployment Clause: Some insurers offer deployment clauses that allow you to adjust or suspend your coverage during deployments without penalty. ● PCS (Permanent Change of Station)
Service members, and their families, experience frequent moves due to PCS orders, which can impact your home insurance:
- Vacancy Clause: Some policies may have a vacancy clause, reducing coverage or raising premiums if your home is vacant for an extended period due to a PCS move.
Rider or Endorsement
A rider or endorsement is an add-on to your home insurance policy that provides extra coverage for specific items or situations. Military members may want to consider:
- Valuables Rider: To protect high-value items like jewelry, collectibles, or expensive electronics. If you live on a military installation, check to assure their minimum requirements for this rider.
- Deployment Rider: Offering additional protection during deployments, such as coverage for personal property in storage or rental property liability.
Flood insurance is a separate policy covering damage from floods, which are not typically covered under standard home insurance. You should research and be aware of your risk zone, especially if stationed in an area prone to flooding. Make sure to discuss your potential need for flood insurance with one of the experts at Armed Forces Insurance.
Understanding home insurance terminology is crucial for military members and their families to make informed decisions and adequately protect their homes and belongings. Here are some final tips to safeguarding your home:
- Remember to review your policy, explore military-specific provisions, and consider additional coverage options like flood insurance and riders. By doing so, you can safeguard your home and peace of mind during your military journey and beyond.
- Annual checks on policy premiums will also assure that you are saving money, and blanketing your home with adequate coverage.
- Customize your policy to make sure it fits your needs and make sure that you have covered your bases with your insurance expert.
This article is sponsored by Armed Forces Insurance. Since 1887, Armed Forces Insurance (AFI) has existed with a single, unwavering purpose: To protect the people who protect our nation. So for more than 136 years, we’ve provided military homeowner insurance, military renter insurance, military auto insurance and much more to our members. Let AFI’s dedicated agents shop our network of national carriers to find the best value and options to fit your needs.