Author Topic: Choosing the right home insurance policy for our situation  (Read 1364 times)


  • 5 O'Clock Shadow
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Choosing the right home insurance policy for our situation
« on: February 26, 2015, 10:05:21 AM »
I've been reading here for the better part of last year however just recently created an account. This is my first thread and I'd like to thank everyone in advance for their opinions & advice.

My wife and I are in the early stages of growing our MM's. We have a small amount of CC debt we're currently tackling (should be gone by the end of the year), followed by a little over $100k in student loans. In the meantime I've created a new budget for the family and am re-evaluating everything we've been spending money on including fixed and variable costs. I just switched our car insurance and managed to save approx. $600/yr while slightly increasing our coverage. Now I'm assessing our homeowner's insurance and would like your thought's on the right choice for our situation.

Currently we have a 'standard' homeowner's insurance policy (think it's a HO3) and are paying almost $1,200/yr for it. We live downtown in a relatively small city (pop 4,000) and our house is probably only worth $35,000 (we own it). Our policy has a full replacement value for the house of just over $300,000 however if our house was to burn to the ground we really wouldn't want to have a brand new house built here. We would probably rather have some cash and move out of downtown. With that said, is there an option that would better suit our needs? I've been reading a little about HO8's which seem like it might fit our needs due to the low market value and high replacement value. I've talked to a couple different insurance agents in the area and haven't really appreciated what they've had to say. One said they don't do HO8 policies and the other two said they wouldn't suggest it. (probably because we'd save $ and they'd lose it!)

Thanks again for any input.