How to Protect Your North Carolina Home

In 2006, the Insurance Information Institute reported that North Carolina ranked 41st in the country for home insurance premiums. The average premium in North Carolina is about $650. With such affordable rates, finding quality, affordable protection is relatively easy for North Carolina residents. Purchasing a policy is important in order to shelters your house against perils like fires, burglaries, wind damage, and more. And, although the state's climate is generally appealing, the state also sees its share of severe weather, particularly hurricanes. By choosing a well-rounded policy, you can safeguard the investment in your dwelling from these common perils. Read on for more information to guide your buying decisions.

What is Included?

State law does not require residents to insure their dwelling, but if you have a mortgage, your lender will most likely require you to purchase at least a basic policy. A standard plan will contain two sections with different types of protection. Section I includes property coverages (A, B, C, and D), while Section II includes liability coverages (E and F). We've described each of these coverages briefly below.

• A (dwelling) - protects the actual structure of the home and any fixtures included within it (e.g., plumbing, air conditioning, heating, etc.). You should insure your dwelling for at least 80% of its replacement cost.
• B (other structures) - protects other structures on your property that may or may not be attached to the house, such as garages and sheds. The coverage limit for other structures is usually limited to 10% of the limit for Coverage A.
• C (personal property) - shelters the belongings you and the members of your household store in your home. Coverage C is typically limited to 50% of A.
• D (loss of use) - pays for your living expenses while your dwelling is being replaced or repaired after suffering a covered loss. Examples of this might include the cost of a hotel and meals.
• E (personal liability) - provides protection if you or a member of your household are found legally responsible for injuring another person. This will pay for your legal defense and take care of the cost of damages.
• F (medical payments) - pays for the medical costs of anyone injured accidentally on your property. This applies only to people who do not live in your household.

High-Risk Locations

The state offers alternative coverage options to residents who live in high-risk areas and may not qualify for traditional home insurance coverage. For example, if your house is near a beach, it is more likely to suffer wind and storm damage, which makes it a high-risk location. If you live in a high-risk area, you may qualify for the North Carolina Joint Underwriting Association (NCJUA) FAIR plan. The FAIR (Fair Access to Insurance Requirements) plan pools the high risk of certain residents among many different property insurers. Any homeowner or renter can apply for a FAIR plan by contacting the North Carolina Department of Insurance.