This is how location affects your home insurance.
When your insurer determines your insurance rates, they take many different factors into account. One of the most important factors is your home’s location. But how does location influence your insurance rates? Here are some of the things you should know.
Construction Costs and State Regulations
Because your home insurance is meant to cover the full replacement value of your home, your insurer will take the cost of completely rebuilding your home into account when determining your insurance rates. For instance, they must consider things like the size of your home, the cost of building materials, and labor costs. Additionally, they will consider the cost of rebuilding your home to code. If you live in a heavily regulated state, this will drive up your home insurance costs.
Another thing that your home insurer will consider is the rates of crime in the area that you live. If you live in a neighborhood with higher crime rates, your insurer will consider your home more risky to insure. This risk will translate into higher insurance costs. However, if you live in a safe area, your insurance rates will likely be on the lower side.
Finally, if you live in an area prone to major weather events or natural disasters, your home will be at a higher risk for damage. This increased risk will mean higher insurance rates for you. So, if you live in an area prone to major storms, tornadoes, hurricanes, earthquakes, flooding, wild fire, and so on, you should expect your home insurance rates to be on the higher side.
These are some of the ways in which your home’s location affects your insurance rates. Do you have more questions regarding your home insurance? Then don’t hesitate to turn to the professionals at Westwood Insurance Agency. We are ready to assist you with all your insurance needs. Contact us to get started today.