Question: What is Actual Cash Value vs. Replacement Cost?

Actual Cash Value is a method of valuation that recognizes the reduction of value of property as it gets older and becomes subject to wear and tear. Actual Cash Value is calculated by taking the current replacement cost and subtracting depreciation.

Replacement cost is the cost to replace damaged property with like kind and quality at today’s price, without any deduction for depreciation. Following a loss, it may provide the insured a settlement in excess of the property’s actual cash value.

Here is a quick claim scenario: You have a fire in your home and you made a claim to your insurance company and your deductible has been paid. You are now replacing your damaged furnishings, including the $1000 sofa your purchased 5 years ago. If you have actual cash value, the company might give you $500 because that is the actual cost of that particular sofa today. If you have replacement cost coverage, the company will pay $1,200 because that is what it would cost to buy a similar sofa today.

What kind of coverage do you have on your South Carolina Home Insurance?

5 of the Most Common Causes of Electrical Fires

Due to the excessive use of heating appliances and decorative lights during the months of December and January, electrical fires are very serious problems. In fact, the US Fire Administration states that there are 28,600 electrical fires a year, causing $1.1 billion in property damage and loss.

Here are 5 ways to prevent electrical fires not only during those months, but throughout the year.

  1. Keep an eye on old, outdated appliances and faulty electrical outlets. If you notice a worn or frayed cord, replace it! Floors, curtains, and rugs can catch on fire due to the heat it projects. Old receptacles and switches could also ignite.
  2. Replace that outdated wiring. If a home is over 20 years old, increased amounts of electrical appliances will most likely be too difficult to handle. Homes built back then weren’t made for all the technological advancements we have today!
  3. Avoid the misusage of extension cords. Try plugging appliances directly into and outlet and not into an extension cord for an extended period of time. Use them only as a temporary measure.
  4. Space Heaters! Since they are portable, they are more than likely put too close to materials that can easily catch fire such as curtains, clothing, beds, couches, rugs and chairs. Try using the radiator-type rather than space heaters with coils, they are less likely to ignite.
  5. Watch the wattage you are using for certain lamps and light fixtures. Installing a bulb with a wattage that is too high can easily cause electrical fires. Also keep cloth or paper away from the lampshade.

Many South Carolina home insurance carriers request electrical updates on older homes. Unsure how susceptible your home is to an electrical fire?  It wouldn’t hurt to have an electrician over to evaluate your electric.

Home Buying Tip: Keeping Insurance Affordable with Wind Mitigation

Home buying is less than overwhelming – but we are here to help, at least when it has to do with South Carolina home insurance. If you are searching for a home and looking to keep your insurance premium affordable we have a suggestion: before purchasing a home, determine if the home has any construction enhancements which make your home eligible for wind mitigation credits.

If you are coming from an area that does not have coastal exposure, you probably have not heard of wind mitigation, so here is a quick run down:

What is wind mitigation? Basically, wind mitigation means the steps that are taken to make the home more resistant to hurricane and high-wind damage. A strong home has the necessary items to protect for this kind of damage. Fewer damages result in lower or fewer insurance claims and will ultimately reduce the insurance premium.

How do I know if a home has wind mitigation? You can ask your real estate agent if the home has any wind mitigation features or if there has been a wind mitigation inspection completed by the previous homeowner. If you are really interested in the home, you could contact a licensed contractor and ask them to perform a wind mitigation inspection for a fee.

What should you look for in terms of wind mitigation?

  • Exterior wall opening protection: hurricane-rated window shutters and impact resistant windows
  • Exterior doors: hurricane-rated garage door rather than a standard garage door
  • Strength of your roof deck attachment: type of nails and/or longer nails that will help prevent shingle and roof plywood from being blown off in a hurricane
  • Roof Cover: Having thicker and stronger hurricane-resistant roof shingles, attached with properly sized and properly applied roofing nails to reduce the chance of your roof shingles blowing off in a hurricane. A newer roof is also helpful!
  • Braced gable-ends in the roof framing: Usually done inside the attic to decrease chances that your roof will collapse under hurricane wind
  • Reinforcement of roof-to-wall connection: metal tie-down straps that attach roof rafters to wall studs to decrease chances that all or a portion of your roof will lift off of your house during a hurricane

Not only do these steps help you gain a lower insurance premium, but they also help in other areas. South Carolina Department of Insurance states that the Homeowners who select to replace their windows with impact resistance systems and hurricane shutters have reported savings up to 29% in their energy costs.

Ken’s Interview with SouthCarolinaHomes: What Influences Your Home Insurance Policy?

South Carolina Homes reached out to us requesting an interview to discuss what concepts influence your South Carolina home insurance policy. Check out Ken’s quick interview here:

Check out my interview, What Influences Your Home Insurance Policy on South Carolina Homes For Sale, one of the top sites for South Carolina real estate, including Johns Island, SC homes for sale. South Carolina Homes For Sale also services North Carolina real estate and Georgia real estate.

South Carolina Home Insurance Quote Part 1 of What is Needed and Why

Part 1: Why do we ask for personal information for “just a quote”?

We often get asked this question when we have prospective clients call looking for an insurance quote. There may be instances when we can tell you a general amount of what we are seeing in a certain area, but for the most part, the companies need to identify you to give you an exact, or even estimated, rate. We really want to assist you and get an understanding of all of your South Carolina home insurance needs, and the following information will help us with that.

Real Name and Birth Date: Companies need to verify who you are by your real name and birth date. Not only does this verify who you are, but certain ages could get certain credits and so on.

Occupation: You wouldn’t think it would have an effect on rates, but your occupation is important. It is always a question on the applications we submit to our carriers. For example, there are discounts available for retired individuals and insurance agents are less likely to get preferred rates.

Social Security Number: It is important to understand that insurance is listed under the financial catagory, which means yes, in most cases, a part of the rate is going to be based of the insured financial credibility. Many carriers need to know the social security number for the named insured. This is used to identify the insured as well as research possible claims history. We always ask if it is ok to use this information.

Previous Address: If you have lived at your home less than two years or if the quote is for a new purchase, the carrier requires your previous address. Again, this is used to identify you.

Email Address: We know this is a tough one, even in the digital age because there is so many pointless emails floating around out there. Carriers require and email address in many cases because that is the way they may deliver important documents, including renewal information in policies. We ask for your email address so that we can deliver the quotes to you this way as well as a second means for correspondence.

We know there have been many cases of identity theft across the United States, but we want you to know that you can trust our South Carolina Insurance agency with your personal information. We take all of the necessary precautions to keep all client information confidential.

Check out the 2nd of this two part series next week!

Tips for Filing a South Carolina Insurance Claim – Be Prepared!

We’ve heard the sentence many times, “I think I have an insurance claim, what do I do?” It is a situation of panic, and we understand that. Here are some tips to ease your mind and help you prepare for that unfortunate time when a claim needs to be filed:

  1. Let company know as soon as possible that you have damage. Be upfront with all information pertaining to the loss.
  2. Let the company know the extent of the damage, let them know if it is completely destroyed or just a little damaged. If you have to find a place to stay, they will need to know that.
  3. Document your loss and make a list of damaged property – be as detailed as possible. Something may not seem important to you, but could be the key piece in getting a payout for your claim.
  4. Take photographs – it is the easiest way to document.
  5. Take out your home inventory list. Many people will run into a wall here since they haven’t completed their inventory list. Is this you? Try using this website:
  6. Keep receipts for additional living expenses. Is your kitchen damaged and need to go out to eat? Keep the receipt. Need to purchase something to control the damage? Keep the receipt. Get the hint? Keep your receipts!
  7. Make inexpensive temporary repairs, but stay safe. If your home was struck by lightening from a thunderstorm and it put a hole in your roof (true story) get a tarp to make sure there isn’t more damage to the area from the rain. Even the smallest attempt at controlling damage is appreciated.
  8. Get organized, keep great records of receipts and contact info for every person you have talked to. If you had someone come out and look at the damage before making a claim, document it and maybe get a firm signed document of a quote or what they told you. You will also want to have every contact person document just incase something is wrong or if you become a product of the last tip:
  9. Don’t be a victim of a scam! These days, people are searching for more ways to make money. Do yourself a favor and research contractors and companies before you use them.

Whether you are in Bluffton, Hilton Head, Myrtle Beach or Charleston, it is important that you know the way your specific South Carolina Home Insurance carrier would like for you to do in the event of a claim. All carriers have a claim phone number and many times you can call your agent and they can help you out. In the event of a hurricane or major storm, your agent may not be available, so knowing your carrier’s claim hotline is incredibly important.