Image: mrpuen / FreeDigitalPhotos.net
Properly Insuring Your Colorado Real Estate
As a real estate agent in Colorado, it’s essential that you advise your clients on the proper kinds of property insurance. While property insurance is important all over the country,Colorado has some unique risks that those property owners should be aware of. By advising them the correct way, you can help them ensure that their investment is protected in the case of extreme conditions.
Homeowners 1 Policy
There are 8 types of Colorado homeowners insurance that homeowners can consider. Many homeowners have a Homeowners 1 policy (HO1), but many don’t know that it’s really not enough because it covers so little. When clients consider that it covers basic issues like fire and lightning, burglary, malicious mischief, most think this is enough. However, it doesn’t cover some of the serious conditions that may happen in Colorado.
Homeowners 2 and 3 Policies
The Homeowners 2 policy (HO2) will cover damages that occur to the home; usually the roof. This includes damage from frozen pipes and damage from weight on the roof from snow or ice. It also covers damage that may happen to appliances from electrical issues. The Homeowners 3 policy (HO3) will cover the home as well as the losses of objects inside the home and some bodily injuries. The HO2 policy also covers those things mentioned in the HO1 policy.
Homeowners 4 and 5 Policies
The Homeowners 4 policy (HO4) isn’t typically something homeowners will need to worry about, because it is for apartment dwellers. However, the Homeowners 5 Policy (HO5) will cover everything that is covered in the HO3 policy as well as the physical loss of personal possessions. It does have some items that are not covered, so homeowners will need to read their policies thoroughly in order to determine specifically what is not covered.
Homeowner 6, 7 and 8 Policies
Homeowners don’t typically need to worry about the HO6 and HO7 policies, because these cover condominium units and losses for mobile home units. However, the HO8 policy is an important one because it covers certain things for homeowners that aren’t covered in the previously discussed policies. It covers the same items as the HO1 policy, but it provides cash coverage to homeowners rather than replacement cost coverage. This is most valuable in cases where the home is an older home, and it provides cash value after the depreciation is deducted.
By informing clients about Colorado home insurance, you can be sure they’re knowledgeable enough to determine what the best insurance for them is. It’s important to encourage them to research their options fully so they can choose the coverage that best suits their specific needs, but talking about the differences as well as the benefits is a wise choice Colorado real estate agents can make for their clients. Its always best to consult with an insurance professional and make sure they are advising rather than yourself.
